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Question on Donation of real property

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1 Question on Donation of real property on Sat Sep 04, 2010 2:48 pm

yellahfellah


Arresto Menor
Good day po.

I would like to ask if it is possible to transfer several real properties via several Deeds of Donation, one for each TCT, in order to avail of the lower tax brackets for Donations? My lola has 4 properties and they have a combined worth of P2+ Million. (They are more or less in the same district/area.) I heard kasi that if your property is only worth around P500T, your tax rate for the donation will be a lot less.

Or should we consider transfering the properties via Deed of Sale?



Last edited by yellahfellah on Sat Sep 04, 2010 2:52 pm; edited 1 time in total (Reason for editing : added some details...)

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2 Re: Question on Donation of real property on Sat Sep 04, 2010 9:20 pm

attyLLL


moderator
by the book, donations are totalled for the year so even if there are several donations, the sum total will be considered. or you can donate them on different years.

who is the donee? if it's you, do you have any cousins who may become jealous about this?

if you are not paying for them, then a deed of sale would be a falsified public document. of course it's up to you to weigh that risk.


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3 Re: Question on Donation of real property on Mon Sep 06, 2010 9:07 am

yellahfellah


Arresto Menor
attyLLL wrote:by the book, donations are totalled for the year so even if there are several donations, the sum total will be considered. or you can donate them on different years.
Assuming all 4 properties are worth P2.1 Million (per Zonal Valuation], how much will the Donor's Tax be and how will it be computed? Are there any other related fees/charges/expenses that we will be required to pay aside from the Donor's tax (I.e. doc stamps, registration fee, lawyer's prof. fee, etc.), and how would they be computed?

In comparison, how much would the transfer via deed of sale cost us? I read kasi in another post in this forum that the total cost of the Capital Gains Tax (excluding the lawyer's prof. fee I assume, and "out-of-pocket" expenses) will amount to 8.25% of the property's value.


attyLLL wrote:who is the donee? if it's you, do you have any cousins who may become jealous about this?
Is is possible for the donation to be made out to several persons? Kasi one of my titas wants a process whereby they have some sort of a safeguard if ever the transfer is made to only one person.


attyLLL wrote:if you are not paying for them, then a deed of sale would be a falsified public document. of course it's up to you to weigh that risk.
Do you mean to say that transferring the properties to one (or all) of us via deed of sale (then selling the properties and dividing up the proceeds among ourselves) is not legal, if one of the "heirs" is not given his share in the proceeds? Kasi my lola doesn't want one of my titos to be included anymore because she already gave him a property a few years ago when he started a business.

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4 Re: Question on Donation of real property on Tue Sep 07, 2010 9:58 pm

attyLLL


moderator
donation will most probably cost more in terms of taxes, it may be best to get a pre-assessment from the BIR. yes, the donation can be made to several persons. you should also consider declaring this as a donation in contemplation of death because the taxes are lower.

an excluded heir can question the donation if there is not enough property left for his legitime.

note that it is your lola's children and spouse who are the rightful heirs. if any are dead, they can be represented by the grandchildren


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