Q. Hi, Atty. Wong. I appreciate the legal advice you share with your readers. My parents are considering adding me to the title of their small residential property in the Philippines. Both of them are residing in the Philippines.
What taxes and fees will be incurred should they proceed with this process? Do I need to be present in the Philippines when they add my name to the title? Kind regards, Mary.
Ans: Assuming that you are now of legal age (at least 18 yrs old), your name may be added in the title of the real property in the Philippines as co-owner.
As to the kind of taxes that may be due on account of such transfer or inclusion of your name in the title of the land, depends on what kind of mode (document) of transfer that will be used in the process.
If the inclusion is with out any consideration (payment) but out of love and generosity of your parents towards you, then your parents will just execute a Deed of Donation transferring certain interest/rights/portion or title of the land in your name. In this document, you have signified also your acceptance of the donation by signing the same. Then you will have to pay the so called “donor’s tax”, Capital gains tax, if any gain, documentary tax and transfer fees, among others . The amount of which depends on the market value or zonal valuation of the property which ever is greater or higher.
Now, if the mode of transfer and inclusion of the portion of the property is with consideration or payment, then your parents will have to execute or sign a Deed of Sale in your favor. You will have also to sign in the said document as the buyer and your parents as the seller.
As to the taxes under this mode of ownership transfer, the taxes due could be in the nature of capital gains tax if there is gained realized by the seller over the sale of the property , documentary tax and transfer fees, among others.
Again the amount of such taxes and fees would depend on the consideration or selling price, market value, or zonal valuation of the property, whichever is higher.
Considering that you are based in the Canada and your parents are in the Philippines, any of the above transactions may be executed by you even if you are in Canada and physically absent in the Philippines. However, in order that the said document may be recognized in the Philippines, the same must be notarized or acknowledged by the Philippine Consulate office nearest of your residence in Canada.
Real estate issues are complex by nature. In order that everything will be in order, it is suggested that you engage the services of lawyer, preferably in the Philippines, to prepare the suggested documents mentioned above.
Thank you for writing and for being a part of the “Batas Pinoy Global Community.”
Disclaimer: Batas Pinoy Corner Not Legal opinion:
Material placed on this corner is for the purpose of providing information only. It is not intended as practice of law or legal services. Although the writer believes this information to be accurate at the time it is first provided or as relayed by the person asking or soliciting the information from the writer. Such circumstances or understanding of the facts as conveyed to the writer by the sender may not actually reflect the ultimate facts or circumstances earlier represented and as understood by the writer.
This writer makes no representation, express or implied, as to the accuracy, completeness or timeliness of the information provided in this writing. The content provided by Batas Pinoy Corner is not meant to be a substitute for legal opinion. Always consult your lawyer or other legal professional for legal advice as regards to the information obtained in this column.
* * *
Readers who may have legal concerns affecting their persons, property, rights,title and related interest concerning Philippine laws and jurisdiction, are welcome to e-mail their query either in English or Pilipino in plain, concise and orderly presentation of facts in order to avoid vagueness and misunderstanding of your stories, for appropriate comments to: attyrw@gmail.com .