I have been repeating my plea or warning to heirs regarding the transfer of lands from deceased owners that by June this year 2025, the amnesty for the penalty of estate tax will end. In order for them to avoid the penalty, they should settle the estate of their relatives before the said expiration. Settlement of estate is of course one of the means by which properties are transferred. This settlement of estate may be judicial or extrajudicial but the former is the one being recommended since it is less tedious and cheaper.
How to Transfer Ownership
A land title which is the evidence of ownership over a parcel of land cannot be transferred to another’s name without a duly notarised deed. The Civil Code provides under Article 1403 (2,e) that a sale of real property which is not done through a public document is unenforceable. A verbal agreement between the buyer and the seller will not be sufficient to cause the transfer of the title under the name of the former. The Register of Deeds will not cancel the old title and issue a new one without a duly executed Deed. The most usual document for the conveyance of real property is a Deed of Sale where the vendor/seller transfers the ownership to another for monetary consideration. Of course, it is very important that the vendor is not just the owner of the land but his name must also be the one appearing on the title. If parents wish to transfer the ownership of their lot to a child they can do so through a Deed of Donation. Under our laws on succession however, the value of the lot will be considered as advance inheritance of the child to whom it was donated. In cases where the seller dies before executing a deed of sale, the transfer can be through an extrajudicial settlement with sale. The buyer must first convince the heirs to agree to this procedure since they will be signing the document. In that deed the heirs will extrajudicially settle the estate of the deceased and in the same document convey the property to the buyer. In case the heirs cannot agree on their own with regard to the transfer or the share of each, the settlement may be done through judicial settlement.
Documents and Procedures
As mentioned earlier it is important that a Deed must first be executed between the parties. The services of a lawyer for the preparation of the document is required for this and also the notarization of the same. The spelling of the names of the parties and most especially the technical description must be thoroughly checked. A mistake in the technical description of the lot appearing in the title or any entry will entail the filling of a petition in court for its correction. It is important that all the parties should present their Cedula or Community Tax Certificate to the notary public upon the notarization of the deed. It is in fact required by the Local Government Code under Sec. 163 (a) that the CTC should be presented when acknowledging a document before a notary public.
After the execution of the deed, the required tax should be paid with the Bureau of Internal Revenue and city or municipal treasurer. If it is an extrajudicial settlement, a notice for the same should first be published in a newspaper of general circulation once a week for three consecutive weeks in a newspaper of general circulation in the province (Sec. 1 & 2 of the Rules of Court). After taxes have been paid, the documents may now be submitted to the Register of Deeds and the City or Municipal Assessor for the issuance of the new title and tax declaration respectively.