Transfer of Property (Donation): 9 Easy Steps To Follow
Transfer of Property Title (Donation)
Transferring the title of a donated condo, house and lot, or land in the Philippines involves several steps and can seem complex. However, I’ll break it down into a simple, concise, and informative guide for you. Keep in mind that this process may vary slightly depending on your location and specific circumstances, so it’s essential to consult with a legal expert or the local government for the most accurate and up-to-date information.
Step 1: Gather Required Documents
Before you can start the process of transfer of property or transferring a title for a donated property, you’ll need to gather the necessary documents. These typically include:
- Deed of Donation: This is the legal document that formalizes the donation and outlines the terms and conditions, such as any restrictions or obligations on the part of the donor and donee.
- Transfer Tax Receipt: Proof that the necessary transfer taxes have been paid.
- Real Property Tax Clearance: A certification that all property taxes are up-to-date.
- Certificate of Title: The original certificate of title for the property, if available.
- Valid IDs: Both the donor and the donee must provide valid government-issued IDs.
Step 2: Valuation of the Property
The donated property needs to be valued for tax purposes. The Bureau of Internal Revenue (BIR) will assess the property’s fair market value. This is crucial because the donor and donee may be subject to taxes based on this valuation. The BIR has guidelines for property valuation, and it’s advisable to consult with them or a licensed appraiser for accurate valuation.
Step 3: Pay the 6% Donor’s Tax
In the Philippines, during the transfer of property the donor is usually responsible for paying the donor’s tax. This tax is imposed on the fair market value of the property at the time of donation. The rate is 6% or varies depending on the relationship between the donor and the donee. Close relatives often enjoy lower tax rates or even exemptions. Pay the donor’s tax at the BIR office in your area.
Step 4: Secure a Certificate Authorizing Registration (CAR)
Once the donor’s tax is paid, you need to secure a Certificate Authorizing Registration (CAR) from the BIR. This document allows you to proceed with the transfer of the property title. You’ll need to submit the following to the BIR for the CAR:
- Duly Notarized Deed of Donation
- Official Receipt of the donor’s tax payment
- Proof of property valuation
- Valid IDs of both donor and donee
Step 5: File the CAR with the Registry of Deeds
Take the CAR to the Registry of Deeds office where the property is located. This office is responsible for processing and transfer of property recording. Submit the CAR and other required documents for their records.
Step 6: Transfer of Title
After the Registry of Deeds processes your documents, you can now request the transfer of property title to the donee’s name. This involves the creation of a new title with the donee as the registered owner. You’ll need to pay the necessary transfer fees and submit the following documents:
- Duly Notarized Deed of Donation
- CAR from the BIR
- Official Receipts for taxes and fees paid
- Certificate of Title (to be canceled)
- Valid IDs of both donor and donee
- Real Property Tax Clearance
Step 7: Registration of the New Title
Once the new title is prepared, it needs to be registered. This is done by submitting the documents to the Register of Deeds office again. After the registration process for transfer of property, the new title will be issued in the name of the donee.
Step 8: Update the Records
After the transfer is complete, don’t forget to update other records as well. This includes updating the property’s records with the local government, ensuring that you receive tax assessments and notices in the donee’s name, and notifying utilities and service providers about the change in ownership.
Step 9: Secure Tax Declaration
The final step in transfer of property is to secure a new tax declaration from the local Assessor’s Office. This is crucial for updating property tax records and ensuring that future tax assessments are in the name of the donee.
In summary, transferring the title of a donated condo, house and lot, or land in the Philippines involves several steps, from gathering the necessary documents to paying the donor’s tax, obtaining a CAR, and finally, transferring and registering the new title. Each step is essential, and it’s crucial to follow them meticulously to ensure a smooth and legal transfer of property ownership.
Remember that property laws and regulations can change, so it’s essential to consult with legal experts or government authorities in your area for the most up-to-date information and guidance on transferring property titles through donation in the Philippines.
