Transfer of a Church Lot Through a Notarized Deed of Sale in the Philippines — A Comprehensive Legal Guide (2025)
This article is written for general information only and is not a substitute for personalized legal advice. Philippine statutes, tax rates, and local regulations change; always verify the latest issuances or consult counsel before acting.
1. The Legal Personality Behind “Church Property”
| Form of Religious Entity | Governing Law | How It Holds Title | Who Signs a Deed of Sale |
|---|---|---|---|
| Corporation Sole (e.g., a Catholic diocese, an Iglesia ni Cristo district) | Civil Code (Arts. 151–154) & Revised Corporation Code (R.A. 11232) | In the name of the incumbent bishop/minister as “corporation sole” | The incumbent ordinary/minister plus attestation by the corporate secretary or chancery |
| Religious Non-stock Corporation | Revised Corporation Code | In the corporate name | President or other officer, with a Board resolution & secretary’s certificate |
| Unregistered Religious Association / Trustees | Civil Code Art. 44 (associations) | In trustees’ names in trust for the congregation | Majority of trustees; court approval may be required if property is held in trust for charitable/religious purposes (Rule 99, Rules of Court) |
Tip: Check the Transfer or Original Certificate of Title (TCT/OCT). The registered owner shown there must match the signatory’s legal capacity.
2. Authority to Dispose of an Ecclesiastical Asset
Internal Church Law
- Catholic dioceses must observe Canon 1292 (2019 Codex Iuris Canonici): alienation above the diocesan threshold (commonly ₱20 million) needs Vatican approval.
- Other denominations usually require a General Assembly or Board of Trustees vote.
Civil Requirements
- Board/Chapter Resolution — expressly authorizing the sale, identifying the lot, price, buyer, and authorized signatory.
- Secretary’s Certificate — authenticating that the resolution is valid and unrevoked.
If the land is held in trust for a charitable/religious purpose (e.g., donated with a reversion clause), the seller may need prior Regional Trial Court (RTC) approval under Rule 99 or Art. 139 NCC.
3. Due Diligence Before Drafting the Deed
| Item | Purpose | Where to Secure / Check |
|---|---|---|
| Certified true copy of TCT/OCT | Verify owner & encumbrances | Registry of Deeds |
| Tax Declaration & RPT Clearance | Ensure taxes paid | City/Municipal Assessor & Treasurer |
| Zoning Certificate | Confirm use classification; churches are often in Institutional Zones | LGU Planning Office |
| DAR clearance (if agricultural) | Needed if over 5 ha or if still tenanted | DAR Provincial Office |
| DENR certifications | If within timberlands or protected areas | CENRO/PENRO |
| ECC or NCIP Certificate | If ancestral domain overlap | DENR-EMB / NCIP |
4. Essential Clauses of a Notarized Deed of Sale
Parties — Full legal names; TINs; citizenship (land ownership is limited to 40 % foreign equity for corporations and no foreign natural persons).
Authority Clause — Recite the Board/Vatican/RTC approval. Attach copies.
Property Description — Technical description verbatim from the TCT and tax declaration.
Consideration — In Philippine Pesos (₱), both words and figures. Specify mode and schedule of payment.
Warranties — Title is free from liens; taxes paid; no tenancy.
Vacant Possession & Condition — Whether improvements (church building) are included or to be demolished/relocated.
Turn-over & Risk of Loss — Usually upon full payment and delivery.
Notarial Acknowledgment — Under the 2020 Rules on Notarial Practice:
- Seller and buyer must appear personally.
- Show one current government ID each.
- Notary records entry in Notarial Register; retains photocopies.
5. Taxes, Fees & Typical Timeline
| Stage | Tax / Fee | Rate / Basis | Responsible Party | Time |
|---|---|---|---|---|
| Capital Gains Tax (CGT) or Creditable Withholding Tax (CWT) | 6 % of the higher of (a) Selling Price, (b) BIR Zonal Value, (c) Fair Market Value per tax declaration. (Even church entities pay CGT; exemption applies only to donation or if BIR issues ruling that proceeds are used exclusively for religious purposes—rarely granted.) | Seller | 30 days from notarization | |
| Documentary Stamp Tax (DST) | 1.5 % of the higher of SP/FMV | Buyer (often shared) | 5 days after notarization | |
| BIR Certifications (CAR & eCAR) | ₱100 each + admin fees | Buyer | 3-6 weeks (depends on RDO) | |
| Local Transfer Tax | 0.5 – 0.75 % of SP or FMV | Buyer | 60 days | |
| Registration Fee (ROD) | Graduated; ~₱8,000 per ₱1 M | Buyer | On presentation of CAR | |
| Notarial Fee | Customary 1–1.5 % or flat ₱5k–15k | Usually Buyer | On signing |
Add 12 % VAT if the land is an “ordinary asset” (e.g., church ran a leasing business and classified it as inventory).
6. BIR Clearance Workflow
File Forms:
- BIR Form 1706 (CGT) or 1606 (DST)
- BIR Form 2000OT (DST payment)
Submit:
- Original/Certified Deed of Sale (with DAR if agricultural)
- TCT/OCT Owner’s Duplicate
- Tax Declaration, RPT Clearance
- IDs, TIN cards, Board Resolution & Secretary’s Certificate
Pay taxes at AAB or eFPS; present proof of payment.
Secure Computation Sheet and CAR / eCAR.
Note: CAR validity—one year from issue; register before expiry.
7. Registering the Transfer with the Registry of Deeds
Present:
- Owner’s Duplicate Title
- Deed of Sale (original & 2 certified copies)
- BIR CAR/eCAR with tax clearance stubs
- Transfer Tax Receipt
- DAR/HLURB/DENR clearances where applicable
Pay Entry & Registration fees.
Annotation: ROD cancels the old title and issues a new TCT in buyer’s name.
Retrieve new Owner’s Duplicate after 7–14 working days (varies per ROD).
8. Update the Tax Declaration
Within 30 days of receiving the new TCT:
File a request at the City/Municipal Assessor for transfer of ownership.
Submit photocopies of:
- new TCT
- Deed of Sale
- CAR & RPT clearance.
Secure a new Tax Declaration and pay any advance RPT to enjoy 20 % early-payment discount (varies by LGU).
9. Frequently Litigated Issues
| Issue | Practical Pointer |
|---|---|
| Ultra-vires disposition — seller lacked canonical or corporate authority | Check Board minutes, Canon 1292 rescript or SEC approvals before drafting the deed. |
| Undervaluation to lower taxes | BIR can impose deficiency CGT/DST plus 25 % surcharge & 20 % p.a. interest. |
| Foreign Buyer | Land ownership is constitutionally limited to Filipino citizens & 60 % Filipino-owned corporations (Art. XII, Sec. 7, 1987 Constitution). |
| Reversionary clauses in original donation | Obtain donor heirs’ quitclaim or RTC approval. |
| VAT vs CGT confusion | If the church regularly leases or develops land, BIR may re-classify the lot as an ordinary asset → liable to 12 % VAT + corporate income tax instead of 6 % CGT. |
10. Best-Practice Checklist (Seller’s Side)
| ✔ | What | Why |
|---|---|---|
| ☐ | Secure internal canonical/board approvals early | Prevents notarization delays |
| ☐ | Obtain latest certified TCT & tax decs | Confirms freedom from liens |
| ☐ | Pay any RPT arrears and penalties | CAR will not issue without clearance |
| ☐ | Require buyer’s proof of funds | Ensures closing proceeds smoothly |
| ☐ | Keep notarized copies & electronic scans | Needed for future SEC or apostolic visitation audits |
11. Sample Transaction Timeline (Assuming Metro Manila, non-agricultural)
| Day | Action |
|---|---|
| 0 | Sign & notarize Deed of Sale |
| 1–3 | CGT & DST payment at BIR—get claim stub |
| 3–30 | Wait for CAR/eCAR release |
| 31–35 | Pay Transfer Tax at City Treasurer |
| 35–45 | Register with ROD & receive new TCT |
| 45–60 | Transfer tax declaration; update LGU records |
(Fast-track “One-Time Transaction” counters exist in many RDOs, but delays are common—build in buffer days.)
12. Key Statutes and Regulations Cited
- Civil Code of the Philippines (Arts. 487, 748, 151-154, 1318 et seq.)
- Republic Act 11232 (Revised Corporation Code), esp. Secs. 85–88
- Presidential Decree 1529 (Property Registration Decree)
- BIR National Internal Revenue Code (NIRC 1997, as amended by TRAIN & CREATE) — Secs. 196, 199, 24 (D)(1)
- BIR RR 13-99, RR 8-2019, RMC 24-2020 (CAR issuance & eCAR)
- Local Government Code (R.A. 7160), Sec. 135 (Transfer Tax)
- 1987 Constitution Art. VI Sec. 28(3) & Art. XIV Sec. 4(3) — tax exemptions for property actually, directly, exclusively used for religious purposes
- Canon Law Book V, Canons 1290-1292 (for Catholic entities)
- 2020 Rules on Notarial Practice
13. Final Thoughts
Transferring a church lot is dual-tracked: you must satisfy both civil law (BIR, ROD, LGU) and your denomination’s ecclesiastical governance. The notarized deed is only one piece; failure in any other step—board authority, tax compliance, registration—will cloud the title and may expose church officers to fiduciary liability. Engage qualified counsel and a licensed geodetic surveyor early, keep meticulous records, and budget realistically for taxes and processing fees.