4 Steps to Transfer Lot with Tax Declaration Only
Have you recently purchased a lot without a title? Or you're interested in buying a lot, but the seller only holds a Tax Declaration? Whatever the case may be, you've come to the right place. Many homebuyers or real estate investors who buy from sellers without titles often have problems transferring the property's ownership under their name. Thus, buying a lot with a title is ideal to be on the safe side. But what if the lot has no title but only a Tax Declaration? Can you transfer its ownership to your name?
Contrary to what others believe, a buyer can still transfer the lot to their name and ensure its ownership even if it doesn't have a title, given the seller has a Tax Declaration. So, if you're wondering how to transfer a property with no land title, keep reading as we share the four (4) steps to transfer a lot with Tax Declaration only.
Step 1: Get the CAR from BIR.
First, secure a Certificate Authorizing Registration (CAR) issued by the Bureau of Internal Revenue (BIR). This document is a requirement before performing any transfer of shares. To request this document from the BIR, you must present a legal document proving you purchased the property. Thus, prepare the Deed of Absolute Sale before visiting the BIR. The Deed of Absolute Sale is made and notarized by a lawyer and signed by two (2) witnesses.
At the BIR, you should also pay the Documentary Stamp Tax (DST), equivalent to 1.5% of the selling price, zonal value, or fair market value, whichever is higher. Moreover, you should pay the Capital Gains Tax (CGT), equal to 6% of the selling price, zonal value, or fair market value, whichever is higher.
Step 2: Go to the Treasurer’s Office.
The second step is to visit the Treasurer's Office at the City Hall, Municipal Hall, or Capitol. When visiting the Treasurer's Office, bring the CAR you've obtained from the BIR. In addition, you should pay the Transfer Tax Fee, equal to 0.5% of the selling price, zonal value, or fair market value, whichever is higher.
Step 3: Proceed to the Registry of Deeds.
After paying the Transfer Tax Fee, the next step is to visit the Registry of Deeds. Here, you will submit the original requirements, such as the Deed of Absolute Sale, Tax Declaration, and other documents required for transferring property. Aside from that, you'll need a Department of Agrarian Reform (DAR) Certificate if the property you wish to transfer is agricultural land.
Step 4: Visit the Assessor’s Office.
Once you have submitted the documentary requirements to the Registry of Deeds, the final step is to visit the Assessor's Office. At the Assessor's Office, you can change the name of the Tax Declaration from the buyer to your name. Registering the property you purchased under your name is essential, even if it doesn't have a title yet. Doing this step can ensure the property you purchase is safe and legally registered under your name despite only having a Tax Declaration.
Thus, in case problems arise in the future, you can ensure ownership of the property. But before you purchase a property, ensure it’s categorized as Alienable and Disposable. It means the property is not a protected land and not privately owned. By doing so, you can ensure that the property you’re buying can be titled someday.