This is the standard sharing of expenses between the buyer and the seller when transferring the real estate property title (TCT - Transfer Certificate of Title or CCT - Condominium Certificate of Title) to a new owner:
The SELLER pays for the:
- Capital Gains Tax equivalent to 6% of the selling price on the Deed of Sale or the zonal value, whichever is higher. Withholding Tax if the seller is a corporation
- Real estate taxes due up to date of sale.
- Broker's commission.
The BUYER pays for the cost of Registration:
- Documentary Stamp Tax - 1.5% of the selling price or zonal value or fair market value, which ever is higher.
- Transfer Tax - 0.5% - 0.75 % of 1 % of the selling price, or zonal value or fair market value, which ever is higher.
- Registration Fee - 0.25% of the selling price, or zonal value or fair market value, which ever is higher.
- Incidental and miscellaneous expenses incurred during the registration process.
The "Deed of Absolute Sale" is a Legal Document for transfer of real estate property ownership.
- The Deed of Absolute Sale is brought to the Bureau of Internal Revenue for the Computation of Capital Gains Tax / Withholding Tax and Documentary Tax . After payment of Taxes.
- BIR will issue CAR (Certificate of Authority to Register)
- Pay Transfer Fees at City Treasury
- Pay Registration Fees at The Registry of Deeds and have Transfer of Ownership officially recorded.
- Registry of Deeds issue new Transfer Certificate of Title / or Condominium Certificate of Title.
Documents needed when transferring the title (TCT or CCT) to the new owner:
- Certified true copy of the title / and
- Tax clearance
- Notarized copies of the Deed of Sale
- Certified true copy of Tax declaration of the property
- Receipt from Bureau of Internal Revenue that the capital gains tax and documentary stamps have been paid
- Certificate of Authority to Register (CAR)
- Receipt of payment of the transfer tax and registration fees