Deficiency tax on Unpaid Capital gains and Doc stamps on Property sold in 2008

I bought my real estate property in Eastville subdivision, Cainta,Rizal on Febrauary of 2008. My problem is when i am selling it now i found out that no proper clearance was made by the previous seller in the transfer of the said property to my name.  Thus the corresponding Capital gains and Documentary stamps on the said property were not paid since the date of sale in Feb 2008.  I bought it for three million pesos (P3,000,000.00). My queries are the following;

1.How much would be the tax deficiencies if i have to pay it today? Can you pls specify the penalty rate and surcharge(s).

2. Can i demand the previous seller to pay for it? If she would not agree to to pay the tax deficiency, what legal action
   can i take to compel the owner/seller to settle for the tax def.?
 
3. If i can not produce the deed of Absolute sale today because it was misplaced/lost when we transfer to a new house last year, what would be the basis of the BIR for the computation of the deficiency tax? Is it the zonal value or the market value of the property at the time of sale whichever is higher?
 
4. Can the BIR  waive the penalties and surcharges, so i just have to pay the regular Capital gains tax and the Doc stamps?


Thanks and God Bless!

Hello, just a few questions.

1. What do you mean by no proper clearance?
2. Is the title in your name?
3. How did you know there was a tax deficiency? Did you go to BIR already?

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If the title is in your name, then taxes were paid. If the title is NOT in your name, then a new Deed of Absolute Sale may be executed.

1. By proper clearance i mean that the capital gains tax and doc stamps related to the sale was not paid by the seller.

2. Yes the title of the property is in my name.

3 No my new neighbor who works at the BIR verified the sale and she found out that property was transferred to my name in 2008 without paying the corresponding taxes.So the deficiency.

Thanks again and God Bless!

For a title to be transferred in your name, this should have been the procedure.

1. Docs brought to BIR where a CAR (Certificate Auhorizing Registration) is issued.
2. CAR is issued only upon payment of corresponding taxes.
3. CAR plus docs brought to Registry of Deeds to effect transfer.
4. New title is produced - yours.
5. Tax Declaration is requested.

Now if you're saying that the title is in your name, maybe one of two things happened. One - taxes were paid, Two-someone at the BIR was paid to produce a CAR.

My suggestion is, go to BIR yourself and get more information.

The CAR (if you have the old CAR) will have the name of the Revenue Officer under his/her group supervisor.

Did you pay any miscellaneous fees when the transfer was effected? Buyers shoulder the transfer fees but sellers shoulder the capital gains or withholding tax (if they're a developer).

Good luck.

Addendum: third option is that the CAR used is not authentic. Good luck. Arm yourself with more information prior to your next step.

betchay001 wrote:For a title to be transferred in your name, this should have been the procedure.

1. Docs brought to BIR where a CAR (Certificate Auhorizing Registration) is issued.
2. CAR is issued only upon payment of corresponding taxes.
3. CAR plus docs brought to Registry of Deeds to effect transfer.
4. New title is produced - yours.
5. Tax Declaration is requested.

I know the checking is stricter now, but this was 2008. Was it
- suppoused to be - like that back then too?

Yes, same procedure (BIR first before Registry of Deeds), but not sure if the CAR is the same. Some document will be released from BIR for transfer to be effected.

Thanks again i will follow your suggestion. God Bless!