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Taxes, Commission &
Registration:
the normal sharing of expenses between
the buyer and the seller, transferring the real estate property
title:
The Seller shoulders:
1. 6% of the contract price, or zonal value or fair market value,
which ever is higher as Capital Gains Tax or Withholding Tax for
corporations, and other unpaid taxes due.
2. Pays the usually 3 to 5% of the contract price to the
Agent/Broker.
The Buyer Pays for the:
1. Documentary Stamp Tax - 1.5% of the contract price, or zonal
value or fair market value, which ever is higher.
2. Transfer Tax - 0.5% of the contract price, or zonal value or fair
market value, which ever is higher.
4. Registration Fee - 0.25% of the contract price, or zonal value or
fair market value, which ever is higher.
This sharing of expenses is the standard practice in the
Philippines. However, buyers and sellers can mutually agree on other
terms as long as it is done during the negotiation period (before
the signing of the "Deed of Sale").
Always purchase property with a proper Title & a Deed of Sale if
possible, and if there is no one, a tax declaration is your last
choice.
In this situation, the possession of the land is more or less
legally recognized thru the evidence of declared and paid land taxes
for the land what is occupied.
Whoever this brings with it a certain risk because of the boundaries
with adjoining properties, because of the possibility of an dispute
with neighboring lot-”owners”, simply thru the fact, that the
surveying is a privately one, without a thorough legally binding
basis.
This surveying is done by buyers or claimants and need a
conformation from the adjoining lot-”owners”, who as proof of
conformation agree and sign the most recent Arial survey-map.
Your Agent/Broker will usually do the registration process without
any additional payments.
An adapted form of the "Torrens" system of land registration is used
in the Philippines. The system was adapted to assure a buyer that if
he buys a land covered by an Original Certificate of Title (OCT) or
the Transfer Certificate of Title (TCT) issued by the
Registry of Deeds, the same will be absolute, indefeasible and
imprescriptible.
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