Assessor’s Office – What you Should Know

assessor

Here’s a recent memorandum from the Assessor’s Office in Makati that validates what i have mentioned two years ago issued to all Makati property owners with regards to having their properties assessed every three years.  Any improvement to a structure ( extra room, swimming pool, etc ) should be reported.  It’s a fact that all want to save on their real estate taxes that’s why some don’t report any add ons to their propertty and the current procedure on processing of sale is done doesn’t really protect the buyer.

A mere certified true copy of the tax declaration of land and improvement isn’t sufficient ground to validate that all is clear for the sale.  As the memorandum clearly states, it should be done every three years.  I have experienced several cases wherein the Buyer is kept holding the bag after the sale is done, am referring clearly to the back taxes.  Until the proper taxes are paid, the Assessor’s Office will not issue a new Tax Declaration to the new Owner ( this is a big issue specially if the sale went thru a bank loan ).  The Assessor’s Office penalty is based on a standard formula if the past or current owner can’t produce proper documentation of when the additional improvement was done.

Take note that this is the normal procedure of the sale :

  1. Seller provides a Certified True Copy of Title, Tax Declaration of both land and improvement, Tax Clearance and Certificate Authorizing Registration, all of which has to be verified with their corresponding division as rules that have existed are now being implemented.
  2. Buyer does due diligence ( with regards to tax declaration, it’s just a norm to accept an certified true copy of both the land and the improvement, the improvement is the critical portion as now it has to be within a three year period.
  3. Sale is done, buyer pays seller and deed of absolute sale is done.  Deed of Absolute Sale is notarized.
  4. Bureau of Internal Revenue Onett computes necessary taxes.
  5. Processing of capital gains tax / creditable withholding tax,  Vat ( if applicable ) is done in order to release the Certificate Authorizing Registration ( CAR ).
  6. Upon release of CAR, processing of title is now done so the following payments have to be done :

a) Transfer Tax – City Treasurer’s Office

b) Registration Fees – Register of Deeds

c) Information Technology Fee – Register of Deeds

7,  Upon release of new Title under Buyer’s name, processing of new tax declaration is now done.  This is where an inspection of the property is done and where the problem may arise.

At this point, the Seller has been fully paid so if there’s an issue on back taxes, more often than not, it’s hard to run after the Seller and have them pay the back taxes should there be one.

That is why I’ve advised everyone three years ago that this should be the new procedure when buying a property with an improvement.  It will save you any unnecessary issues and stress and is now the norm on for due diligence.

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Thank you.

robert
Robert G. Sarmiento Properties
Professional Affiliation :
Philippine Association of Real Estate Brokers
Member, City of Taguig Real Estate Board 2016 – 2017
Real Estate Broker’s Association of the Philippines 2000-2015
President, Greenhills Chapter 2008, 2009
Philippine Association of Real Estate Brokers
San Juan Mandaluyong Chapter 1998, 1999
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