A practical legal article in Philippine context (with the usual taxes, fees, documents, and step-by-step process).

1) What “Deed of Sale + Title Transfer” really means

In Philippine practice, transferring land (or land with improvements like a house) typically involves two major tracks:

Contract Track (Private Law):
- Negotiation, due diligence, preparation and notarization of the Deed of Absolute Sale (DOAS) (or other deed: conditional sale, deed of assignment, etc.).
- Delivery of possession, payment terms, warranties, and remedies.
Transfer/Registration Track (Public Law):
- Payment of applicable national taxes (BIR) and local transfer tax (LGU).
- Registration with the Registry of Deeds (RD) and issuance of a new Transfer Certificate of Title (TCT) (or Condominium Certificate of Title (CCT)).
- Update of the Tax Declaration with the City/Municipal Assessor and (often) the Treasurer.

A signed deed alone does not automatically update ownership in the Torrens title system. In most situations, the buyer becomes protected against third parties only upon registration and issuance of the new title in the buyer’s name.

2) The core government costs (what you almost always pay)

A. BIR Capital Gains Tax (CGT) — common in sales of “capital assets”

Typical rate: 6% Base: whichever is higher among:

Selling price/consideration (contract price),
BIR Zonal Value, or
Assessor’s Fair Market Value (as reflected in tax declaration schedules).

Who usually pays: Seller (by custom), but negotiable.

When it applies most often: Sale of real property in the Philippines classified as a capital asset (commonly: property not used in business, for individual sellers).

Important: If the property is an ordinary asset (e.g., held primarily for sale to customers, used in trade/business, or owned by certain businesses/developers), the tax treatment may shift to regular income tax and possibly VAT, instead of CGT.

B. Documentary Stamp Tax (DST)

Typical rate: 1.5% (commonly used for deeds of sale/conveyances of real property) Base: typically the higher of the consideration, zonal value, or FMV (depending on BIR evaluation practice and the form used).

Who usually pays: Buyer (by custom), but negotiable.

C. Local Transfer Tax (City/Municipality)

Typical rate: varies by LGU; commonly up to 0.5% of the tax base; some LGUs in Metro Manila impose a higher rate (often cited around 0.75%) depending on local ordinance practice. Base: commonly the higher of contract price and assessed/FMV basis used by the LGU.

Who usually pays: Buyer (by custom), but negotiable.

D. Registry of Deeds (RD) Registration Fees + Issuance Fees

These are paid to register the deed and issue a new title. Fees follow a schedule and are generally value-based (higher property value = higher registration fee), plus fixed charges (e.g., entry fees, legal research fee, etc., depending on the RD’s assessment).

Who usually pays: Buyer (by custom), but negotiable.

E. Notarial Fees

Notarization is essential because a deed must generally be a public instrument to be registrable. Notarial fees are not fixed nationwide; they vary by location, lawyer/notary, complexity, and property value.

Who usually pays: Often buyer, or split, or per agreement.

3) “Hidden” but common extra costs (people forget these)

These often show up as additional requirements or practical necessities:

Certified True Copies (CTCs) of the title, tax declaration, and other records
BIR requirements processing costs (documentation, travel, queues) if you hire someone
Tax Clearance / Real Property Tax (RPT) arrears settlement
Special Power of Attorney (SPA) notarization/consularization (if a party is abroad or represented)
Geodetic Engineer services (as-needed): relocation survey, lot verification, or boundary issues
Homeowners’/Condo dues clearance (for subdivisions/condos)
Bank charges (if there’s a mortgage release, loan take-out, or escrow arrangement)
Annotation fees / cancellation of annotations (e.g., removal of mortgage, lis pendens, adverse claim)
Extra judicial documents (affidavits of loss, discrepancy affidavits, name correction affidavits)

4) The standard inclusions in a proper “package”

When lawyers, brokers, or conveyancing services quote a “transfer package,” a complete scope commonly includes:

A. Pre-sale due diligence (strongly recommended)

Title verification (authenticity, status, encumbrances/annotations)
Check for adverse claims, mortgages, lis pendens, attachments, or overlapping titles
Tax declaration review, RPT payment status
Identity and authority checks (marital status, corporate authority, heirs/estate issues)
For condos: CCT, Master Deed/Declaration, condo corp clearances, dues status
For subdivisions: developer/HOA clearance requirements

B. Document preparation

Drafting the Deed of Absolute Sale (or appropriate deed)
Ancillaries:
- Acknowledgment receipts, turnover/possession certificate
- Secretary’s Certificate/Board Resolution (corporate parties)
- SPA (if signing by representative)
- Affidavits required by specific offices (varies)

C. BIR compliance processing

Prepare and file BIR forms for CGT and DST (and attachments)
Pay taxes to authorized banks or payment channels
Secure eCAR (electronic Certificate Authorizing Registration) / CAR—this is the BIR clearance required for RD registration

D. Local transfer and registration

Pay Local Transfer Tax (Treasurer’s Office)
Submit to RD for registration; follow up until issuance
Receive the new TCT/CCT in buyer’s name

E. Post-registration updates

Update the Tax Declaration in buyer’s name at the Assessor’s Office
Secure updated records and (if requested) assist with utility/association transfer

If someone quotes “all-in,” ask whether their quote includes government taxes/fees or only professional/service fees. Many quotes exclude taxes and registration fees because those are paid directly to government offices and vary with property value.

5) Step-by-step process (typical order in practice)

Step 1: Gather documents (baseline checklist)

For most individual-to-individual sales:

Owner’s Duplicate Certificate of Title (TCT/CCT)
Latest Tax Declaration (land and improvements)
Latest RPT Official Receipts (often current year + prior years as required)
Valid IDs of seller and buyer; proof of TIN (as required)
Civil status documents when needed: marriage certificate, CENOMAR, etc.
If represented: notarized SPA (and IDs)
If corporate party: SEC registration, Secretary’s Certificate/Board Resolution, IDs of signatories

Step 2: Draft and sign the Deed of Absolute Sale; notarize

Ensure the deed is accurate on:
- Title number, technical description, location, boundaries
- Consideration and payment terms
- Warranties (ownership, encumbrances, taxes)
- Spousal consent if applicable
- Tax allocation (who pays CGT/DST/transfer tax/registration)

Step 3: Pay BIR taxes and secure eCAR/CAR

File/pay CGT and DST with required attachments
BIR evaluates, may require clarification/extra documents
Upon compliance, BIR issues eCAR/CAR

Step 4: Pay Local Transfer Tax

LGU Treasurer assesses and collects transfer tax
Some LGUs require BIR eCAR first; some accept proof of BIR filing/payment before eCAR—practice varies.

Step 5: Register with Registry of Deeds

Submit:
- Notarized deed
- eCAR/CAR
- Transfer tax receipt
- Tax clearances as required
- Other RD requirements (varies by RD)
RD issues new title in buyer’s name after processing

Step 6: Update Tax Declaration

Assessor cancels old tax declaration and issues a new one in buyer’s name
Treasurer updates taxpayer records for future RPT billing

6) Who pays what? (customary allocation vs. legal reality)

There is no single mandatory rule that “seller must pay X” and “buyer must pay Y” in all cases; parties can agree otherwise in the deed. However, customary market practice often looks like this:

Seller pays: CGT (and sometimes document preparation)
Buyer pays: DST, transfer tax, RD registration fees, notarial fees, and post-registration tax declaration update costs

But variations are common:

“Net to seller” deals (buyer shoulders most costs)
Split arrangements (CGT split, or notarial split)
Developer-style deals (especially for ordinary assets/VAT situations)

The cleanest approach is to write the allocation clause clearly in the deed and align payment timing with release of funds and documents.

7) Special scenarios that change the costs

A. “Principal Residence” CGT exemption (individual seller)

Philippine rules allow an exemption from the 6% CGT in certain cases where the property sold is the seller’s principal residence, and the proceeds are used to acquire/build a new principal residence within the prescribed period, subject to conditions, notice requirements, and limitations (including frequency).

Practical effect: You may still pay DST, transfer tax, and registration fees, but CGT may be reduced/avoided if all requirements are met and documented properly.

B. Ordinary asset / VAT cases

If the seller is in the real estate business or the property is treated as an ordinary asset, taxes may involve:

Regular income tax (not CGT), and/or
VAT (depending on thresholds/classification), plus other compliance.

This can materially increase the overall cost and documentation.

C. Sale of inherited property (estate issues)

If the seller’s title is still in the deceased owner’s name, you generally cannot do a straightforward sale transfer without settling estate transfer steps (estate tax compliance, extra-judicial settlement/partition, etc.) or structuring appropriately. This adds major time, documentation, and cost.

D. Encumbered title (mortgage, adverse claim, lis pendens)

Expect extra steps and fees for:

Mortgage release and cancellation of annotation
Court/litigation-related encumbrances (which may block transfer)
Bank documentation and timelines

8) Practical “ballpark” budgeting method (without guessing your exact numbers)

Because most major costs are percentage-based, you can estimate total transaction costs like this:

Determine your likely tax base: higher of (Selling Price vs Zonal Value vs FMV/Assessed benchmarks).
Apply typical rates:
- CGT: 6% (if applicable)
- DST: 1.5%
- Transfer tax: commonly 0.5% (or higher depending on LGU)
Add RD registration fees (schedule-based), plus notarial fees and incidentals.

In many straightforward capital-asset sales, people often find the combined government-imposed burden (CGT + DST + transfer tax + RD fees, excluding professional fees) to be substantial—so it’s best to plan early and specify who shoulders which items.

9) Common pitfalls (and how to avoid them)

Underdeclaring the price
- Taxes are computed using the higher benchmark anyway, and underdeclaration can create disputes, delays, and risk exposure.
Skipping due diligence
- A “clean-looking” title can still have issues (fake title, overlapping claims, unpaid taxes, unauthorized seller).
Not addressing marital/property regime issues
- Spousal consent and correct signatories matter; mistakes can jeopardize validity/registrability.
RPT arrears and missing clearances
- These can delay eCAR, transfer tax payment, or RD processing.
Signing without control of the Owner’s Duplicate Title
- Buyers should manage release of funds through escrow or staged releases tied to document delivery.

10) Suggested “inclusions checklist” you can demand in writing

If you’re hiring a lawyer/processor, ask for a written scope that states whether it includes:

✅ Title and tax due diligence checks
✅ Deed drafting and revisions
✅ Notarization coordination
✅ BIR filing/payment assistance and eCAR/CAR release
✅ LGU transfer tax processing
✅ RD registration and release of new title
✅ Assessor tax declaration transfer
✅ Handling of special cases (SPA, corporate docs, mortgage cancellation)
✅ A clear list of excluded items (government taxes/fees, penalties, geodetic surveys, bank charges, HOA/condo clearances, etc.)

11) Short legal note (practical, not courtroom)

Philippine property conveyancing is document-and-compliance heavy. The safest approach is to treat the process as a bundle: (1) valid deed, (2) correct taxes paid, (3) registrable documents, and (4) proper registration and tax declaration update. If any link is weak, the transfer can be delayed, become expensive through penalties, or be exposed to disputes.

If you want, tell me just these three details and I’ll lay out a tailored cost checklist and workflow (still in general informational terms):

City/Municipality of the property, 2) property type (vacant lot/house-and-lot/condo), 3) seller type (individual vs corporation).