This article explains the law and practice around purchasing “heir property” when the only document on hand is a Real Property Tax Declaration. It is written for transactional clarity and risk control in the Philippine context.

I. What “Heir Property” Usually Means

“Heir property” commonly refers to real estate left by a deceased owner that has not been fully settled or transferred to the heirs through a deed of extrajudicial settlement, court proceedings, or other formal conveyance. Typical situations:

Titled in the deceased’s name, with heirs merely paying taxes and informally occupying.
Untitled but tax-declared, often long-held family land where possession has passed from generation to generation.
Rights being sold (e.g., “benta ng karapatan”): an heir offers to sell his/her aliquot share or hereditary rights before partition.

Key principle: A tax declaration is not proof of ownership. It is only an indicator of possession and a basis for real property taxation. Buying based merely on a tax declaration exposes you to material title risk.

II. Core Legal Framework (Plain-English Overview)

Ownership vs. Tax Declaration. Ownership over land is proved by a Torrens title (OCT/TCT) or, in untitled land, by recognized modes (e.g., prescription, patents) proven with strong evidence. A tax declaration supports possession but does not by itself vest ownership.
Transfer from a Decedent. Real property of a deceased person forms part of the estate. It may be transferred through:
- Extrajudicial Settlement (EJS) by all heirs if there are no debts (or debts are settled) and no will, with publication and subsequent tax/transfer processing; or
- Summary or Ordinary Court Settlement if judicial intervention is needed; or
- Partition when co-heirs divide the property.
Sale by an Heir.
- An heir may sell only his/her hereditary rights, not the specific parcel, before partition. The buyer steps into the heir’s shoes and becomes a co-heir as to that share.
- A sale of the entire property requires all heirs (and a court-appointed guardian for minors) to sign, or a judicial process authorizing it.
Minors or Incapacitated Heirs. Any disposition of a minor’s share requires court approval through guardianship proceedings.
Spousal Consent. If the decedent acquired the property during marriage under a conjugal/ACP regime, surviving spouse rights must be observed.
Estate and Transfer Taxes. Payment of estate tax and issuance of a BIR Certificate Authorizing Registration (CAR) are necessary before new titles/tax declarations issue in the heirs’ names; thereafter sale taxes apply if selling to a third party.

III. The Unique Risks of Buying with Only a Tax Declaration

Defective or Absent Title. You may be buying from someone who is not the owner (or only a part owner), risking void or voidable transfer.
Incomplete Heir Participation. Omitted heirs can later annul the sale or demand partition; illegitimate, adopted, or previously unknown heirs often surface.
Minor Heirs/No Court Approval. Sales without judicial authority over minors’ shares may be voidable.
Unpaid Estate and Real Property Taxes. Without estate settlement and real property tax (RPT) clearances, you cannot secure CAR, transfer, or reissuance of title/tax dec in your name.
Conflicting Claims. Overlapping tax declarations, double sales, forged signatures, or pending agrarian/ancestral domain claims.
Regulatory Restrictions. Possible coverage under CARP/CLOA (restrictions on sale), ancestral domains/NCIP regimes, reservations, foreshore, road-right-of-way, or government lands (imprescriptible).
Survey and Boundary Issues. Old sketches lead to encroachments or area shortfalls uncovered only during relocation surveys.
Possession vs. Ownership. Long possession with tax declarations helps evidentiary proof, but does not cure title defects against a registered owner.

IV. Practical Deal Structures

A. Best-Case (Cleanest) Route

Heirs first settle the estate (EJS with publication or court settlement).
Transfer title/tax declarations from decedent to heirs (pay estate tax; get CAR; file with Registry of Deeds and Assessor).
Heirs sell to you by deed of absolute sale (DAS).
You register and obtain your TCT and new tax declaration.

Result: You receive registrable, defensible title.

B. Interim Route (Purchase of Hereditary Rights)

You buy the heir’s hereditary rights (Deed of Assignment/Cession) with warranties and obligations to complete estate settlement.
Add escrow or holdback conditions tied to milestones (estate CAR issuance, partition, issuance of heirs’ titles, then your transfer).
Recognize you are stepping into co-ownership—not acquiring a specific metes-and-bounds parcel—until partition.

C. Conditional Sale with Closing Conditions

Execute a Contract to Sell where closing occurs only after:
- Estate settlement completed; CAR issued (estate and sale, if applicable).
- All heirs sign (or court/guardian approval obtained).
- RPT, penalties, and arrears paid; RPT clearance obtained.
- Survey/relocation confirms boundaries/area.
- Regulatory checks (DAR, DENR, NCIP, LGU zoning/road setbacks) pass.
Use a neutral escrow to hold funds and original documents until conditions are met.

V. Due Diligence Checklist (Step by Step)

1) Identity, Capacity, and Heirship

Government IDs of all sellers/heirs; civil status and property regime proof (marriage certificate, if relevant).
Death certificate(s) of the registered owner(s); birth/adoption records proving filiation.
Heirship tree (genealogy chart) and Affidavit of Self-Adjudication/EJS drafts to confirm completeness.
Check for minors or incapacitated heirs (need guardianship and court leave).
If an heir is abroad: require apostilled/consularized SPA and documents.

2) Title and Property Status

Registry of Deeds: Certified True Copy (CTC) of title, if any; encumbrances (mortgage, lis pendens, adverse claims).
If untitled: Request DENR-LMB and CENRO records (public land status, patents), cadastral maps, prior survey numbers, approved plans.
Assessor’s Office: Current Tax Declaration, Tax Map Control Roll (TMCR), and tax history; check for overlapping tax decs.
Treasurer’s Office: RPT statement, arrears/penalties, and delinquency sale risks.
Survey/Relocation by a Geodetic Engineer: Verify metes and bounds, monuments, area, encroachments, easements (including road right-of-way, waterways).

3) Legal/Regulatory Clearances

BIR: Estate tax computation/filing, CAR for estate transfer, then CAR for sale; documentary stamp/CGT (or CWT), certificate of zonal value/FMV.
DAR: Check CARP/CLOA coverage, retention limits, and 10-year prohibitions or restrictions (if applicable).
NCIP: If within CADT/CALT or ancestral lands, comply with consent/transfer restrictions.
LGU: Zoning certification, locational clearance if planning development, setback/easement compliance.
DENR: Foreshore, timberland, easements, or protected area issues; for patents/free patents in case of public land.

4) Occupancy and Possession

Verify actual occupants (tenants, informal settlers, caretaker claims).
Barangay certifications (boundary disputes, peace and order).
Leases/tenancies (especially agricultural lands—tenancy rights have strong protection).

5) Taxes, Fees, and Closing Costs (Typical)

Estate Tax: On the net estate (heirs’ obligation prior to transfer).
Capital Gains Tax (or Creditable Withholding Tax if seller is a corporation): Typically 6% of the higher of selling price or BIR zonal/assessed FMV.
Documentary Stamp Tax: Typically 1.5% of the same tax base as CGT.
Transfer Tax (LGU): Often 0.5–0.75% of tax base (varies by LGU).
Registration Fees (Registry of Deeds), Annotation Fees, Notarial Fees, Survey Costs, and RPT arrears/penalties if any.

(Percentages vary by law, regulation, and local ordinances; verify current rates at transaction time.)

VI. Contractual Protections You Should Demand

Who Signs. All heirs (and spouse(s) of heirs if required by property regime), or a court-appointed guardian for minors; or the judicial authority if applicable.
Representations & Warranties.
- Full and exclusive ownership or clear statement you are buying hereditary rights only.
- No other heirs or, if there are, that they are signatories; no pending cases; no liens/encumbrances undisclosed.
- Complete tax compliance (estate and RPT) at or before closing.
Conditions Precedent to Closing.
- Issuance of BIR CAR(s) (estate and sale).
- RPT clearance; delivery of original owner’s duplicate title (if titled).
- Approved subdivision/partition plans (if needed).
- Regulatory clearances (DAR, NCIP, DENR, LGU zoning) where applicable.
Escrow/Holdback.
- Purchase price deposited in escrow; release only upon delivery of registrable documents.
- Holdback for discovered arrears, occupants’ relocation, or pending annotations.
Survey & Area Risk.
- Tolerance clause with price adjustment or rescission rights for material area shortfall or encroachment.
Remedies.
- Specific performance or rescission with liquidated damages for seller breach.
- Survival period for warranties; dispute resolution clause (venue, mediation/arbitration).

VII. Special Land Classes and Red Flags

CLOA/CARP Lands. Look for 10-year (or other) prohibitions and restrictions; often require DAR clearance/consent.
Ancestral Domains/Lands. Transactions may be void without compliance with IPRA and NCIP processes.
Government/Timberland/Foreshore. Generally non-alienable; private sale is invalid.
Road Lots/Easements/Waterways. Hidden servitudes reduce usable area and value.
Multiple Marriages/Unknown Heirs. Verify complete heir roster to avoid future nullity/partition suits.
Forged or “loaned” IDs, loose notarization, or “flying signatories.” Use diligent KYC and reputable notaries.

VIII. Practical Pathways Depending on What You’re Shown

Scenario 1: Untitled, Only a Tax Declaration

Treat as possession evidence only. Require seller-heirs to obtain title first (e.g., via judicial confirmation, patent if eligible) or sell you hereditary rights with escrowed price and clear milestones to perfect title later.

Scenario 2: Titled, Still in Decedent’s Name

Require EJS with publication, estate CAR, then heirs-to-buyer sale and registration. Avoid paying in full before estate CAR and presentation of the owner’s duplicate and registrable deed.

Scenario 3: One Heir Selling “My Share”

Buy only with clear acknowledgment you are stepping into co-ownership; insist on right to participate in partition and call option to buy other heirs’ shares, or a drag/tag mechanism in a co-ownership agreement.

IX. Timeline & Document Flow (Illustrative)

KYC & Preliminary MOA/Term Sheet
Title/Records Checks (RD, Assessor, BIR, DAR/NCIP/DENR, LGU)
Survey/Relocation
Heirship Verification; Draft EJS/Partition
Estate Tax Filing & Payment → BIR CAR (Estate)
Transfer to Heirs (RD & Assessor)
Deed of Sale to Buyer → BIR CAR (Sale)
Registration (RD) → New TCT in Buyer’s Name
New Tax Declaration (Assessor) → RPT Enrollment (Treasurer)
Escrow Release & Turnover

X. Frequently Asked Practical Questions

1) Can I register the sale if only a tax declaration exists? No. You need a registrable instrument from the registered owner (or proper estate settlement leading to the heirs) and compliance with BIR/LGU processes. A tax declaration alone cannot be the basis for issuance of a TCT in your name.

2) Is a deed of sale from one heir valid? It is valid only as to that heir’s hereditary rights—not the entire property—unless all heirs (and required consents) sign or a court authorizes the disposition.

3) Can long possession cure title defects? Possession plus tax declaration helps your evidence, but it does not defeat a subsisting registered title. Prescription rules are technical; government lands are imprescriptible.

4) Should I pay in full before CAR and registrable docs? Avoid doing so. Use escrow and milestone-based releases.

XI. Summary: Principles to Live By

Never equate a tax declaration with ownership.
Insist on estate settlement (or buy hereditary rights with robust protections).
Check all heirs, minors, and spousal rights.
Clear taxes and obtain CARs before closing.
Verify regulatory overlays (DAR, NCIP, DENR, LGU zoning).
Anchor payment to escrow and registrability.
Get a competent geodetic survey to avoid boundary surprises.

XII. Model Clauses You Can Ask Your Lawyer to Include

All-Heirs Participation Clause with list of heirs and capacity warranties.
Conditions Precedent: estate CAR, RPT clearance, delivery of owner’s duplicate, survey confirmation, regulatory clearances.
Escrow & Holdback: release upon RD issuance of buyer’s TCT; holdback for arrears or eviction of unauthorized occupants.
Survival & Indemnity for undisclosed heirs, liens, and claims.
Partition/Co-ownership Agreement (if buying hereditary rights) with drag/tag and buy-out mechanisms.

Final Note

Because details vary widely (family trees, minors, agrarian or ancestral issues, unpaid taxes, overlapping tax declarations), every “heir property” transaction is fact-specific. The safest approach is to convert the chain from decedent → heirs → buyer on the public record with taxes paid, conditions completed, and funds safeguarded in escrow until your title is ready for registration.