Comprehensive Guide to the Cost of Transferring Land Title in the Philippines (2025 update)
1. Why costs matter
When legal ownership of real property changes hands—whether by sale, donation, inheritance, barter, corporate reorganization or even court order—the new ownership must be entered in the Torrens title. Until the transfer is registered with the Registry of Deeds (ROD), the change is not binding on third persons. Failure to budget for the attendant taxes and fees can derail the whole transaction, expose the parties to penalties, and cloud the title.
2. Statutory foundations
| Cost item | Statutory basis | Collected by |
|---|---|---|
| Capital Gains Tax (CGT) | NIRC §24(D), §27(D) | BIR |
| Documentary Stamp Tax (DST) | NIRC §196 | BIR |
| Estate Tax | NIRC Title III | BIR |
| Donor’s Tax | NIRC Title III | BIR |
| Value-Added Tax (when applicable) | NIRC §109, §106 | BIR |
| Local Transfer Tax | LGC §135 & §151 | City/municipal treasurer |
| Registration Fees | PD 1529, LRA Schedule of Fees (2014, still in force) | Registry of Deeds |
| Notarial Fees | Rule III §1, 2023 IBP Notarial Schedule | Notary Public |
3. Taxes payable to the Bureau of Internal Revenue
| Situation | Tax | Rate | Tax base (higher of) | Who customarily pays |
|---|---|---|---|---|
| Sale or barter by individuals | Capital Gains Tax | 6 % | ❶ stated consideration, ❷ BIR zonal value, ❸ provincial/city assessed value | Seller |
| Sale by corporation of non-inventory land | CGT or Creditable W/T Tax (whichever BIR applies) | 6 % CGT or 15 % WT | Same bases | Seller |
| Donation | Donor’s Tax | 6 % | Net donations during the year above ₱ 250 000 | Donor |
| Inheritance (extra-judicial settlement/partition) | Estate Tax | 6 % | Net estate after deductions | Heirs or estate |
| All instruments above | Documentary Stamp Tax | ₱ 15 per ₱ 1 000 (≈ 1.5 %) | Same bases | Usually seller (may be shared) |
| VAT (rare for raw land; common for subdivisions/condos if seller is VAT-registered) | 12 % | Gross selling price | Added to price; borne by buyer if not priced-in |
Deadlines: File CGT/DST within 30 days of notarisation; Estate & Donor’s Tax within one year of death or donation. Surcharges (25 % or 50 %), interest (12 % p.a.) and compromise penalties apply if late.
4. Local Transfer Tax (Title Transfer Tax)
Imposed by the city or municipality where the property lies.
Rate ceiling:
- Cities & Metro Manila LGUs: 0.75 % of the tax base
- Provinces/Municipalities: 0.50 %
Tax base mirrors the BIR base (whichever is highest).
Deadline: ordinarily 60 days from the date of execution of the instrument; otherwise surcharges up to 25 % plus monthly interest.
5. Registration & annotation fees
The Land Registration Authority (LRA) still follows its 2014 graduated schedule. Fees are computed on the tax base as follows (rounded):
| Tax base (₱) | Registration fee |
|---|---|
| Up to 500 000 | 0.25 % |
| 500 001 – 2 000 000 | ₱ 1 250 + 0.20 % of excess over ₱ 500 000 |
| 2 000 001 – 5 000 000 | ₱ 4 250 + 0.15 % of excess over ₱ 2 000 000 |
| Over 5 000 000 | ₱ 8 750 + 0.10 % of excess over ₱ 5 000 000 |
Add ₱ 30-₱ 50 per annotation, ₱ 50 per page for certified true copies, and IT service fees for electronic titles.
6. Notarial, processing and incidental costs
| Item | Typical range (Metro Manila) | Notes |
|---|---|---|
| Notarisation of deed | 1 %-1.5 % of price or flat ₱ 1 500-₱ 5 000 | Higher for corporate acts |
| BIR certificate fees (OCF, CTC) | ₱ 30-₱ 200 | |
| Liaison/runner/service fees | ₱ 5 000-₱ 15 000 | Optional but speeds processing |
| Real Property Tax clearance | Varies; settle arrears + ₱ 150-₱ 500 cert. | |
| Condominium HOA, subdivision, DAR clearances | If applicable, ₱ 500-₱ 3 000 |
7. Cost-sharing conventions
- Seller: CGT (or VAT if seller is a developer), DST, outstanding RPT, notarial fee on deed of sale.
- Buyer: Transfer Tax, ROD registration fee, new tax declaration fee, and incidental costs.
- Parties are free to contract otherwise, but the BIR/LGU will not recognise private arrangements when assessing liability.
8. Sample computation (2025)
Property: 150 m² residential lot in Quezon City sold for ₱ 3 000 000. BIR zonal value: ₱ 2 800 000 (lower than price). Assessed value: ₱ 1 000 000 (lowest).
| Item | Rate | Amount |
|---|---|---|
| Capital Gains Tax | 6 % × ₱ 3 000 000 | ₱ 180 000 |
| Documentary Stamp Tax | 1.5 % × ₱ 3 000 000 | ₱ 45 000 |
| QC Transfer Tax | 0.75 % × ₱ 3 000 000 | ₱ 22 500 |
| Registration Fee (LRA) | See table: ₱ 4 250 + 0.15 % of ₱ 1 000 000 | ₱ 5 750 |
| Notarial Fee (1 %) | - | ₱ 30 000 |
| Total Cash Outlay | ₱ 283 250 (excl. incidentals) |
Who pays? If following convention, seller bears ₱ 255 000 (CGT + DST + Notarial); buyer pays ₱ 28 250.
9. Special situations & exemptions
- Principal-residence exemption (NIRC §24(D)(2)): CGT on sale of a family home can be deferred if the entire proceeds are reinvested in another principal residence within 18 months; otherwise CGT becomes due plus interest.
- Tax-free exchange (NIRC §40(C)(2)): property-for-shares transfers to a corporation are CGT-exempt if “control” (≥ 51 %) is acquired. DST still applies.
- Estate-tax amnesty extension (RA 11956): Estates of decedents who died on or before 31 May 2022 may file and pay a 6 % rate until 14 June 2025 with no penalties.
- Socialized housing & Cadastral free patents: exempt from CGT and DST under PD 957 & RA 9176 respectively.
- Transfer to government or barangay: exempt from CGT and DST (NIRC §199).
10. Procedural roadmap
Due-diligence: secure latest Certified True Copy (CTC) of title, tax declaration, RPT clearance, HOA clearances.
Execute & notarize the Deed of Sale/Donation/Partition.
BIR filing at the Revenue District Office where property is located:
- Submit deed + supporting docs (ID, TIN, tax dec, sketch plan).
- Pay CGT/DST (or Estate/Donor’s Tax).
- Receive eCAR (electronic Certificate Authorizing Registration) within 5-15 working days if complete.
LGU Treasurer: pay local Transfer Tax and secure tax receipt.
Registry of Deeds: present original title, eCAR, RPT & Transfer Tax receipts, tax decal, deed, IDs. Pay registration fees.
New Owner: collect new OCT/TCT in 2-4 weeks; transfer tax declaration at Assessor’s Office.
11. Penalties for late payment
| Tax | Surcharge | Interest |
|---|---|---|
| CGT, DST, Estate, Donor’s | 25 % (⁕ 50 % if willful neglect) | 12 % per annum |
| Local Transfer Tax | Up to 25 % | Up to 2 % per month |
| Registration (unregistered deed) | Cannot annotate mortgage/sale until paid; may constitute fraud under Art. 315 RPC |
12. Recent developments (2024-2025)
- RA 11956 (Estate Tax Amnesty Extension) in force until June 14 2025.
- e-Title roll-out: LRA now requires electronic titles for newly issued TCTs in 35 provinces; conversion fee averages ₱ 1 860 if voluntary.
- TRAIN Law rates unchanged:** CGT at 6 %, Donor’s & Estate at 6 %, DST at 1.5 %.
- Electronic One-Time Transaction (eONETT) portal: pilot in RDOs 39 & 45; expected national rollout by Q4 2025, allowing online payment of CGT/DST.
13. Frequently asked questions
- Can the buyer pay the CGT to expedite release? – Yes, but note that the BIR will still issue the eCAR in the seller’s name; a side agreement is required to protect the buyer’s recourse.
- Is VAT due on sale of raw residential lots? – Generally no if seller is an individual not engaged in real-estate business. If the seller is a developer or VAT-registered entity, 12 % applies unless the lot is priced ≤ ₱ 3.6 million (VAT-exempt threshold, TRAIN §109).
- Do I need a lawyer? – Not legally required, but recommended for deeds involving minors, conjugal/family code issues, or corporate sellers.
- How long does the whole transfer take? – With complete documents: 3-4 weeks in Metro Manila; 6-8 weeks in congested registries. Missing clearances or capital-gains disputes can stretch processing to 6 months.
14. Key takeaways
- Budget 9 %-10 % of the price to cover all taxes, registration, and incidental fees for a typical Metro Manila sale.
- File taxes on time: CGT & DST within 30 days, local Transfer Tax within 60 days, or face stiff surcharges and interest.
- Remember the Estate Tax amnesty deadline—June 14, 2025—for unsettled estates.
- Always verify the BIR zonal value; if it is higher than the contract price, taxes will be computed on that higher figure.
- Keep every receipt and the original eCAR; they are indispensable for future transfers or refinancing.
With these figures and procedures in mind, parties can enter into real-estate transactions confident that the hidden costs of title transfer are fully understood and adequately provided for.