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Deed of Donation or Deed of Sale?

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1 Deed of Donation or Deed of Sale? on Mon Oct 04, 2010 1:38 am

rose88


Arresto Menor
I hope you can help me. I wish to transfer land title ownership to my only child, 21 years old. I want to know which is a better move, Deed of Donation or Deed of Sale. Below is the detailed situation:

1. I have been separated from my husband for 14 years now. I bought the property on my own after the separation. Will this lead to complications if I want my only child to have the property?

2. Will the taxes be based on the contract price of the property if I pursue a Deed of Donation? Or will it be based on purchase value?

3. For a property worth P2million - P3million, will the taxes be bigger if Deed of Sale?

Looking forward to your advice. Thank you!

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2 Re: Deed of Donation or Deed of Sale? on Mon Oct 04, 2010 11:28 pm

attyLLL


moderator
does it say on the title that you are married? your first problem is that you cannot transfer without your husband's signature.

if your child is not paying for the property, i cannot openly advise you to execute a deed of sale. you can also consider a donation in contemplation of death (advance inheritance) so that the taxes will be lower.


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3 Re: Deed of Donation or Deed of Sale? on Sat Mar 05, 2011 7:35 pm

aboutwhat


Arresto Menor
hi atty..

ask lang po about deed of donation, may pirma na po ng parents ang deed of donation para sa anak nila pero di po naipanotaryo ng parents...pwede po bang yung pinagbigyan na din po ang magpanotaryo tutal po pirmado na ang papers???thanks po

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4 Re: Deed of Donation or Deed of Sale? on Sun Mar 06, 2011 4:45 pm

attyLLL


moderator
why are the parents not having it notarized?


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5 Re: Deed of Donation or Deed of Sale? on Sun Mar 06, 2011 7:39 pm

aboutwhat


Arresto Menor
parang along the way nagkakaroon po ng alinlangan ang mother pero wala naman pong problema sa father hangang nakamatayan na po ng parents...ganun po paano po ba yun? may bisa pa po ba ang napirmahan na??o back to normal lang po lahat ?means ang lahat children nila ang may rights?

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6 Re: Deed of Donation or Deed of Sale? on Mon Mar 07, 2011 6:58 pm

attyLLL


moderator
then the answer is no, it can not be notarized because the signatories are already dead. the donation has no effect, and the property is included in the estate.


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7 Re: Deed of Donation or Deed of Sale? on Mon Mar 07, 2011 8:02 pm

aboutwhat


Arresto Menor
ok atty thanks po...pero sa other case naman po ng iba na buhay pa po ang parents..pwede po bang yung pinagbigyan na din po ang magpa-notaryo?basta pirmado na po ng nagdonate?o need pa rin po ang presence ng signatories?

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8 Re: Deed of Donation or Deed of Sale? on Mon Mar 14, 2011 2:20 pm

nengeetot


Arresto Menor
Good day atty!


My Lola has 2 parcels of land which she would like to give to my mom and my aunt. My aunt wants both of the land to be named to her and my mom for joint ownership. Is Deed of Donation the best choice for this? And can we include both lands in one Deed? Thanks!

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9 Re: Deed of Donation or Deed of Sale? on Sat Mar 19, 2011 9:32 am

attyLLL


moderator
aboutwhat, i recognize that many notaries violate their oath by allowing notarization by their secretaries and without the presence or the actual signatories. indeed you can probably find a notary who will be willing to notarize the document but everyone will be at risk.


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10 Re: Deed of Donation or Deed of Sale? on Sat Mar 19, 2011 9:35 am

attyLLL


moderator
neng, before you proceed, i recommend you have the donor tax computed first at bir so you will know how much you need to prepare. i recommend you have a donation mortis causa for lower taxes.

i also recommend separate deeds for easier facilitation.


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11 Re: Deed of Donation or Deed of Sale? on Wed Mar 30, 2011 9:22 pm

aboutwhat


Arresto Menor
atty. good day po,

ano po ba ang mas mahal na bayaran deed of donation or deed of sale..???sa parents ko po ang property, una nga po deed of donation ang gusto nila..then pinalitan ngayon deed of sale na lang daw po kasi naaawa sila sa asawa ko gusto nakaname sa aming mag- asawa kasi pag donation po sa akin lang naka name e...basta may pledge lang po ang asawa ko na maghuhulog din siya...san po ba talga kami makakamura ng bayarin pag pina transfer ko na po ang title?? balewala din po sa mister ko kasi okey lang kanya if donate sa akin xempre ng parents ko coz un naman ang totoo...gusto lang po talaga namin mura lang magastos sa pagpapalipat coz anak din po namin mapupunta yun...thank u po

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12 Re: Deed of Donation or Deed of Sale? on Thu Mar 31, 2011 5:22 pm

attyLLL


moderator
if it is a donation, and you make it appear into a sale, you can be charged with falsification of a public instrument and tax evasion. if you are willing to risk it, then sale may be result in lower taxes, but you should compare this to a donacion mortis causa, because there is a P1M deduction allowed.


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13 Re: Deed of Donation or Deed of Sale? on Thu Mar 31, 2011 8:07 pm

aboutwhat


Arresto Menor
ano po yung P1M na deduction allowed atty.??paki explain nga po iyon...thanks po

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14 Re: Deed of Donation or Deed of Sale? on Thu Mar 31, 2011 8:15 pm

attyLLL


moderator
1 million deducted from the value of the property for computation for tax purposes. better to inquire at the BIR and have a pre-computation made.


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15 deed of sale or donation on Sat Apr 16, 2011 12:53 pm

zyalik


Arresto Menor
atty. good day..

my tita has an 240sqm of land in novaliches. which we own. just that her name is on the title. and we would like to transfer the land to us. which would be advisable and cheaper, a deed of sale or a donation...? and could the transfer be done in a month, kasi yun ung sabi sa procedure. thanks po ng madami. God bless

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16 Re: Deed of Donation or Deed of Sale? on Wed Apr 20, 2011 8:02 am

attyLLL


moderator
shouldn't the first concern be, which is truthful? if you are paying for it, then a sale. if not, a donation. a false narration of facts is falsification of a public document and possibly tax evasion.


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17 Re: Deed of Donation or Deed of Sale? on Mon May 02, 2011 1:57 pm

zyalik


Arresto Menor
fully paid na po atty. just asking if which process would be faster if sale or donation. thanks

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18 Re: Deed of Donation or Deed of Sale? on Fri May 06, 2011 7:29 pm

attyLLL


moderator
there's really not much difference in terms of time required. if you paid for it, then it should be a deed of sale.


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19 Re: Deed of Donation or Deed of Sale? on Tue May 10, 2011 5:18 pm

brlacuata


Arresto Menor
Hi attyLLL,

We have the same situation with rose88 in this forum. Hope you can help us.

My mom owns 4 lands (3 lots and 1 lot with boarding house) with all land title under her name. My parents were separated in 1989 (22 years now) and both of them are still alive. The lot with boarding house she bought when she was still single. After the separation, she bought 3 lots but she use her maiden name in the title even though she is already married at that time.

Are all these property still conjugal?
If these are conjugal property and my dad waived his rights, is there a donor tax for this on top of the donor tax for my mom’s donation to us?
Do we need my dad’s signature in all the deed of donation mortis causa?
Will we have problem if she donate the 3 lot (in maiden name instead of married name) to her children or should she correct it first?
Can she donate 1 lot to 2 children or should it be 1 lot per children?
Is it cheaper if she just make her last will and testament instead of deed of donation?

Appreciate your advice on the best and cheapest way for her to ensure that my dad will not get these lands in the event that she die ahead of him.

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20 Re: Deed of Donation or Deed of Sale? on Wed May 11, 2011 12:59 am

attyLLL


moderator
yes, they are conjugal.

the waiver of rights by the husband has no effect.

no need to correct the title.

have your parents donate the properties to you.


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21 Re: Deed of Donation or Deed of Sale? on Wed May 11, 2011 9:11 am

brlacuata


Arresto Menor
thanks for your reply atty Smile

I found this BIR ruling on Donation Mortis Causa and I have some concerns:

ftp://ftp.bir.gov.ph/webadmin1/others/33837BIR%20Ruling%20No%2081.htm

From what I understand from this BIR ruling, deed of donation mortis causa is exempted from donor's tax. And since it will take effect only upon the death of the donor, the real properties subject to the donation cannot be transferred in the name of the donee and shall thereby remain the properties of the donor while he/she is alive.

If we process deed of donation mortis causa (since its exempted from tax) for my dad's share of the conjugal property, can he get this back later on? Example: he already donate it to us, then my mom die ahead of him, then he decided that he wants to sell it since based on the above ruling it's still his properties while he is alive.. is this possible?

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22 Re: Deed of Donation or Deed of Sale? on Wed May 11, 2011 10:58 am

attyLLL


moderator
yes, he can change his mind. note that while it is exempted from donor's tax, estate tax will have to be paid.

if you have the money, buy it from them even at a big discount.


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23 Re: Deed of Donation or Deed of Sale? on Wed May 11, 2011 11:33 am

brlacuata


Arresto Menor
you mean estate tax will have to be paid... right after signing of donation mortis causa? or after death of donor?

If we buy it, how many % is the allowed big discount? Can it be 95% discount?

I'd like to know this so I can compare which is cheaper between deed of sale with big discount (we'll pay purchase cost + its capital gain tax) and the regular deed of donation (we'll pay donor's tax)

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24 Re: Deed of Donation or Deed of Sale? on Wed May 11, 2011 1:54 pm

attyLLL


moderator
estate tax will be paid upon the death. you can discount it till the assessed value of the property.


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25 Re: Deed of Donation or Deed of Sale? on Thu May 12, 2011 9:09 am

brlacuata


Arresto Menor
thank you for all your help atty.. god bless!!!

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