Declaration?
A Contract to Sell (CTS) is a contract document executed by both the seller and buyer where the seller promises and binds himself to sell to the buyer a certain
property upon the occurrence of several conditions to be fulfilled by the buyer or both the seller and the buyer, the non-fulfillment of which releases both from their
respective obligations under the terms of the contract. A contract to sell usually provides that title to and ownership of the property is not transferred to the buyer until
full payment of the contract price.
A Deed of Sale (DOS) Upon fulfillment of the sale-contract conditions, which is usually the full payment of the contract price, a DOS is executed by the seller
unconditionally transferring to the buyer title to and ownership of the property which is usually specifically described in terms of technical descriptions as contained in
the existing certificate of title to the property. A DOS is an absolute conveyance of title of ownership from the seller to the buyer, without reservations or conditions, and
is primarily executed by the seller and accepted by the buyer. The DOS might also contain certain restrictions on the use of the property by the owner as contained in
a subdivision mother title or declaration of restrictions previously recorded in the original or existing transfer certificate of title. In the case of condominium units, it is
accompanied by a certificate of the management body of the condominium project that such conveyance or sale is in accordance with the provisions of the
declaration of restrictions of such project.
A Transfer of Certificate of Title (TCT) is an instrument issued by the Registrar of Deeds for the city or province where the land is located declaring the absolute
ownership of a certain real property technically described therein. The TCT is prepared and executed by said Registrar and delivered to the buyer of the property as
the new owner upon submission by the buyer of the DOS and payment of corresponding fees and taxes. It is an indefeasible and conclusive proof of absolute title to
ownership of the property not only between the seller and the buyer but also between the buyer and the rest of the world. However, the TCT may also contain certain
restrictions on the exercise of ownership rights passed on from the previous TCT or mother title or liens and other forms of encumbrances.
A Condominium Owner’s Copy of Certificate of Title (CCT) is an instrument issued by the Registrar of Deeds for the city or province where the condominium project
is located containing a brief description of the land, the condominium conveyed, and name and personal circumstances of the condominium owner. It is issued
upon registration of the DO S conveying the condominium unit, payment of the proper fees, and annotation of the conveyance on the certificate of title covering the
land included within the subdivision project. It is proof of title to and ownership of the condominium unit described therein.
A Tax Declaration is a city or municipal receipt containing description of land where the real estate tax of which has been paid under the name of the payor who may
or may not have title to or ownership of the land being declared. It is a mere proof of possession of the land by the payor and not of ownership. It is not a title or
certificate of ownership.
Value-added Tax
Except for sale of residential lots with gross selling price below P1,500,000, or of residential dwellings with gross selling price below P2,500,000, the sale of real
property will include a value added tax (VAT) at the rate of 12% of the purchase price, zonal value of market value under the Tax Declaration of the property, whichever
is higher, payable on each sale of real property to the BIR.
Documentary Stamp Tax
Documentary Stamp Tax at the rate of 1.5% of the purchase price, zonal values, or the market values under the Tax Declaration of the property, whichever is higher, is
payable to the BIR within ten (10) days after the close of the month when the DOS is signed and notarized.
Local Transfer Tax
Local transfer tax is imposed by the local government unit where the property is located generally at the rate of 0.5% of the purchase price, zonal value, or TD value of
the property, whichever is higher.
Registration fees are payable to the Register of Deeds where the property is located at the rate of P8,796.00 for the first P1.7million plus P90.00 for every P20, 000.00
or fraction thereof in excess of P1.7 million.
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