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Maldita23

Good day,

I am looking for a real estate lawyer for consultation  to help me understand  buying a condo unit in Cebu Business Park. Recommendations are highly appreciated. 

One of my concerns is the Capital Gains Tax.

     A.) Capital Gains Tax (6%)-  I understand that this should be paid by the seller, but our seller said that we should shoulder this. And their broker said that they know how to lower the value so we would pay smaller tax? How is that possible? Is their any legal explanation to this?

 

Thank you.

   

 

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I have never paid more than 20k for a lawyer to handle a real estate transaction. Paying a percentage of the total cost is ludicrous. There is no more work (on the lawyer's part) for a 20 million peso

The broker is most likely referring to two bills of sale, one real and one for much lower, I would not do that as not paying the correct amount of tax could end up a possible problem and especially wh

Also a thing to remember is VAT due on condos sold for over ₱3,199,200 

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Lee
9 minutes ago, Maldita23 said:

Good day,

I am looking for a real estate lawyer for consultation  to help me understand  buying a condo unit in Cebu Business Park. Recommendations are highly appreciated. 

One of my concerns is the Capital Gains Tax.

     A.) Capital Gains Tax (6%)-  I understand that this should be paid by the seller, but our seller said that we should shoulder this. And their broker said that they know how to lower the value so we would pay smaller tax? How is that possible? Is their any legal explanation to this?

 

Thank you.

   

 

The broker is most likely referring to two bills of sale, one real and one for much lower, I would not do that as not paying the correct amount of tax could end up a possible problem and especially when you then have a broker and a seller who have something to hold over your head.

Unless the property was listed as CGT paid by buyer, it is the responsibility of the seller. 

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Davaoeno

Capital Gains Tax- has nothing to do with capital gains, it is just a fee that gets charged on the sale price.   It is most usual for the seller to pay, but the parties are free to decide for themselves who will pay . I usually have the seller and the buyer each pay one half of all transfer costs ie capital gains tax, doc stamps, notarial, ROD fees etc.   Most buyers will refuse to pay all of the capital gains tax [ unless its an incredible deal and the price reflects it ! ]

How to lower the value for fees payable? This is illegal, but just about everyone does it . And I mean just about everyone.  It is as pinoy a thing as you will ever find !! lol           The attorney will do 2 sets of Deed of Sale - one at face value and one at a lower price agreed on by the parties. The lower priced one is submitted to the government agencies for fee calculations.  Sometimes only the lower one is made.  

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Lee

Also a thing to remember is VAT due on condos sold for over ₱3,199,200 

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Maldita23

@Lee,  so on top of  Capital Gains Tax   6 %,Transfer Tax  0.5 %,Documentary Tax  1.5 %,Registratation Fee 0.25 %, we have to pay 12 % as well because it is over 3M?

 
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Maldita23

Another question. The seller said that they purchased the condo at 6.5M as reflected on the Deed of Sale. Did they have to pay the taxes too on top of that or these prices normally include all the taxes required.

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Lee
41 minutes ago, Maldita23 said:

@Lee,  so on top of  Capital Gains Tax   6 %,Transfer Tax  0.5 %,Documentary Tax  1.5 %,Registratation Fee 0.25 %, we have to pay 12 % as well because it is over 3M?

 

It will depend on if the unit has already been titled but see below.

38 minutes ago, Maldita23 said:

Another question. The seller said that they purchased the condo at 6.5M as reflected on the Deed of Sale. Did they have to pay the taxes too on top of that or these prices normally include all the taxes required.

I am going to suggest you contact the lawyer posted by Headshot as I have never bought or sold anything in the Philippines in that price range and while I think I know the correct answer, I do not wish to take a chance that I might be wrong. 

Whatever the case, do not let any of the fees stop you from buying, it is my opinion that things will only end up more expensive down the road but what do I know, I am just going by personal experience and the fact that I/we have been very happy owning a condo in Cebu for over 10 years now.

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Aerosick
3 hours ago, Maldita23 said:

I am looking for a real estate lawyer for consultation  to help me understand  buying a condo unit in Cebu Business Park. Recommendations are highly appreciated. 

You will also need to check (and see owner receipts) for monthly property management dues, electric, water and all utility bills, insurances paid up, parking fees (if needed). Check all costs for using the condo building's amenities (gym, pool, exercise room, etc.).

See who provides the building with phone and internet service. In our building phone & internet are provided by Globe with internet also from CableTV (which I haven't tried). Globe has a maximum number of connections available and they are all full. Any new renters / owners have to get on their waiting list and wait for someone else to quit their service.

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samatm

@ op  Please Take a look at my condos in IT Park.    I can be flexible and owner finance.  Davaoeno will help us walk through the process.  Right  Sir Ian? 

 

 

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rep1

Are you buying from owner or developer?

If from developer you don't need lawyer it's just standard procedure, however ridiculous the terms might be.

From owners you do need a lawyer, as others told. Precisely because they do things such as under-valued reporting and requiring you to shoulder what's for them to pay.

Undervalue is mainly to avoid VAT (12%) and reduce CGT. You could also use two or more names to buy adjacent units to avoid VAT - it's totally legal.

Also since you're a foreigner ? You should need the condo management to verify the ratio of foreigners in the condo building is below 40%, after you buy. You might be in very deep trouble if you accidentally make a purchase that breaks this limit.

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Flakes
57 minutes ago, rep1 said:

Are you buying from owner or developer?

If from developer you don't need lawyer it's just standard procedure, however ridiculous the terms might be.

From owners you do need a lawyer, as others told. Precisely because they do things such as under-valued reporting and requiring you to shoulder what's for them to pay.

Undervalue is mainly to avoid VAT (12%) and reduce CGT. You could also use two or more names to buy adjacent units to avoid VAT - it's totally legal.

Also since you're a foreigner ? You should need the condo management to verify the ratio of foreigners in the condo building is below 40%, after you buy. You might be in very deep trouble if you accidentally make a purchase that breaks this limit.

Sound advise..Thanks.

Yes i am a foreigner and most likely will buy from a owner.Indeed i will consider a trustable lawyer to check on paperwork and correct procedure.what other costs are mine anyway besides the purchase price when buying a secondhand condo?

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rep1
5 hours ago, Flakes said:

Sound advise..Thanks.

Yes i am a foreigner and most likely will buy from a owner.Indeed i will consider a trustable lawyer to check on paperwork and correct procedure.what other costs are mine anyway besides the purchase price when buying a secondhand condo?

See https://www.hoppler.com.ph/blog/real-estate-investment-tips/how-to-buy-properties-in-the-philippines-a-guide-for-ofws-filipinos-abroad

scroll to the part titled "Real Estate Transaction Costs in the Philippines"

Also since you buy secondhand, it's possible the seller would want you to shoulder the agent fee (typical 5%) and lawyer's fee (1-3%? not sure).

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rep1
15 hours ago, Maldita23 said:

Good day,

I am looking for a real estate lawyer for consultation  to help me understand  buying a condo unit in Cebu Business Park. Recommendations are highly appreciated.

BTW inside CBP I think most second handed units are not cheaper than presale ones. You may want to compare the real prices.

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smokey

 I have a question to condo buyers when you see a model in the mall is that what you get ? Is it just like the model minus the furniture ...does it come with stuff like a ref. stove etc ... do you pick your tiles for the floor is there a choice is it just like the model when they turn it over

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