Exemption from Capital Gains Tax

Hi lawyers, please explain this excemption in layman's term.

How to get an exemption from capital gains tax on sale of my principal residence in the Philippines?
The sale of you principal residences may be exempted from capital gains tax, subject to the following conditions;

1. Sale or disposition of principal address
2. By natural person
3. Proceeds of which is fully utilized in acquiring or constructinga new principal residence within eighteen (18) calendar months from the dale of sale or disposition
4. The historical cost or adjusted basis of the real property sold or disposed shall be carried over to the new principal residence built or acquired
5. The Commissioner shall have been duly notified by the taxpayer within thirty (30) days from the date of sale or disposition
6. The said tax exemption can only be availed of once every ten (10) years.
7. Execution of Excrow Agreement
8. If there is no full utilization of the proceeds of sale or disposition, the portion of the gain presumed to have been realized from the sale or disposition shall be subject to capital gains tax.

General Rule, in every sale of real property and/or residential/pricipal house, Capital Gains Tax (CGT) must be paid.

Exception: When you sell your Principal Residence/Main House(where you usually reside and live), CGT need not be paid, PROVIDED:

1. In selling your house, the proceeds therefrom is USED TO CONSTRUCT a NEW residence(your new house).

2. That NEW residence(house) MUST be constructed within 18months FROM the sale of your old residence(house).

3. There must be a notice filed to the BIR within 30 days from the sale of your OLD residence(House) stating therein your intent to avail such exemption and that a escrow account be opened in accordance to the order of the BIR.

- That escrow account will serve as a "collateral" that you must fully use or utilize the PROCEEDS from the sale of your old residence in constructing a new residence. Otherwise, if the PROCEEDS were NOT fully utilized, then you are liable to pay CGT(based on the sale of your old house) that can be debited from your escrow account.

4. Lastly, this exemption, must be availed of every 10 yrs, which means that you cannot avail this exemption of non paying the CGT if you sell your NEW residence within 10 yrs counted from the time of its completion.