In the realm of Philippine real estate and corporate transactions, the Electronic Certificate Authorizing Registration (eCAR) is the "golden ticket." Without it, the Register of Deeds cannot issue a new Transfer Certificate of Title (TCT), and a Corporate Secretary cannot record the transfer of shares in the Stock and Transfer Book.
The eCAR serves as the Bureau of Internal Revenue's (BIR) official confirmation that all applicable taxes for a specific transaction have been fully paid or that the transaction is legally exempt.
1. General Documentary Requirements
Regardless of the type of transaction, every application for an eCAR must include these foundational documents:
Tax Returns (BIR Forms): Proof of filing and payment for Capital Gains Tax (CGT), Documentary Stamp Tax (DST), Donor’s Tax, or Estate Tax.
Proof of Payment: Generally a Validated Deposit Slip from an Authorized Agent Bank (AAB) or an e-payment confirmation receipt.
Mandatory Identification: * Taxpayer Identification Number (TIN) of both the Transferor and Transferee.
Government-issued IDs of all parties involved.
Special Power of Attorney (SPA): If the person processing the eCAR is not the buyer or seller, a notarized SPA (or Secretary’s Certificate for corporations) is required.
2. Specific Requirements: Sale of Real Property
When transferring land or buildings, the BIR requires a deep dive into the property’s history and valuation.
| Document Type | Specific Requirement |
|---|---|
| Title | A Certified True Copy of the Transfer Certificate of Title (TCT), Condominium Certificate of Title (CCT), or Original Certificate of Title (OCT). |
| Tax Declaration | Certified True Copy of the latest Tax Declaration for land and improvements (buildings) as of the date of the transaction. |
| Deed of Conveyance | A notarized copy of the Deed of Absolute Sale or similar document. |
| Tax Clearance | A Certificate of No Improvement (if the land is vacant) or a Certificate of Non-Delinquency for Real Property Tax from the Local Treasurer’s Office. |
| Vicinity Map | Needed if the Zonal Value cannot be readily determined from the existing BIR schedules. |
3. Specific Requirements: Transfer of Shares of Stock
For the transfer of shares not traded through the Local Stock Exchange, the focus shifts to the company's financial health.
- Deed of Sale: Notarized document indicating the number of shares and price.
- Stock Certificates: Photocopy of the certificates being transferred.
- Proof of Acquisition Cost: To determine the capital gain, you must show what the seller originally paid for the shares.
- Audited Financial Statements (AFS): The AFS of the issuing corporation for the year immediately preceding the date of sale is necessary to determine the Book Value of the shares.
- Certificate of Listing: If the shares are listed but sold "off-board."
4. Specific Requirements: Inheritance and Donations
Transfers involving death or "gratuitous" (free) transfers have unique triggers.
For Estate Tax (Inheritance)
- Death Certificate: Certified copy from the Philippine Statistics Authority (PSA).
- Extrajudicial Settlement (EJS): A notarized deed signed by the heirs, or a Court Order if the estate is settled judicially.
- Affidavit of Publication: Proof that the EJS was published in a newspaper of general circulation for three consecutive weeks.
For Donor’s Tax (Gifts)
- Deed of Donation: Notarized and showing acceptance by the donee.
- Relationship Proof: Proof of relationship between the donor and donee (if claiming specific exemptions, though most donations are now taxed at a flat 6% under the TRAIN Law).
5. The Process: Where and How
- Jurisdiction: The application must be filed at the Revenue District Office (RDO) having jurisdiction over the location of the property. For shares of stock, it is the RDO where the seller is registered.
- The ONETT System: The eCAR is processed through the BIR’s One-Time Transaction (ONETT) system.
- Verification: Every eCAR now features a QR Code. The Register of Deeds or the buying party can scan this to verify the authenticity of the certificate against the BIR's database, a measure implemented to curb the proliferation of "fake CARs."
6. Critical Reminders
- Validity: An eCAR is generally valid for one (1) year from the date of issue. If it expires, a request for revalidation must be filed.
- The "Six Percent" Rule: Under the TRAIN Law, the Capital Gains Tax on real property is generally 6% of the gross selling price or the fair market value (Zonal Value), whichever is higher.
- DST Deadlines: Be mindful that the Documentary Stamp Tax must usually be paid by the 5th day of the month following the date of the notarized deed—late payments trigger heavy surcharges and interest before an eCAR will be released.