GMA signs Free Patent Act

Law allows Filipinos to acquire titles for their home lots

By GENALYN KABILING
March 18, 2010, 5:07pm

President Gloria Macapagal-Arroyo has signed into law a measure that would allow many
Filipinos to legally acquire titles to the land that they have been in possession for more than 10
years, Malacaang said Thursday.

Republic Act No. 10023 or an Act Authorizing the Issuance of Free Patents to Residential Lands
was approved by the President last March 9.

The Free Patent Act, ratified by the two houses of Congress last December, seeks to ease the
requirements and procedures in the titling of residential lands and bring to life such dormant
wealth.

An estimated 39 million Filipinos living in unregistered lands are expected to benefit from the
new law that amended the Public Land Act.

Prior to the enactment of the law, the landowners could only acquire title through the court under
the present Public Land Act that often resulted in tedious process.

For starters, the newly signed RA 10023 cut down the period of eligibility for titling from 30
years to 10 years.

Any Filipino who has paid all the real estate taxes for 10 years shall be entitled to free patent for
such parcel of land in all municipalities and cities.

Only alienable lands that are not needed for public service or public use can be subject to free
patent.

Rather than hire a lawyer and wait for years for court approval, the landowner can easily lodge
an application with the Department of Environment and Natural Resources (DENR) to acquire
title through free patent.

Other salient features of the law are the issuance of free patents without payment of outstanding
real estate taxes and removal of restrictions after issuance of free patents.

The government expects the Free Patent Law to secure the property rights of the owner and spur
entrepreneurial activity in the country.

At present, an estimated 46 percent of the 24.2 million parcels of land in the country remain
untitled. Of these, 70 percent or 7.8 million are residential lands.
 Without the free patent law, land authorities earlier said it would take several decades to secure
title for the 7.8 million residential land parcels.

Arroyo OKs tax info exchange

Meanwhile, the Bureau of Internal Revenue (BIR) is now authorized to exchange information on
tax matters with foreign counterparts to help fight international tax evasion based on Republic
Act No.10021.

This, after President Arroyo signed into law the measure allowing the country to comply with the
Internationally Agreed Tax Standards (IATS) for exchange of tax information with the countrys
tax treaty partners.

The new law, which amended some provisions of the National Internal Revenue Code of 1997,
sought to strengthen the governments capacity to implement the countrys commitments under
existing tax conventions or agreements.

A consolidation of House Bill 6899 and Senate Bill 3220, the new law authorizes the BIR
commissioner to inquire into bank deposits and other related information held by financial
institutions to supply information to a requesting foreign tax authority.

RA 10021 will also allow requesting foreign tax authority to study the income tax returns of
taxpayers upon order of the President subject to rules and regulations on the necessity and
relevance that may be promulgated upon enactment of the law.

It will also penalize BIR personnel for unlawful divulgence of information obtained from banks
to persons other than the requesting foreign tax authority.

The law also provides sanctions for bank officers who refuse to supply requested tax
information. The requesting foreign tax authority likewise is mandated to maintain
confidentiality of the information received.

The Arroyo government expects the new law to promote a tax environment that contributes to a
favorable climate of international trade and investments.

The government earlier found difficulty to comply with the provisions on the exchange of
information set by international organizations due to some legal restrictions, particularly the
countrys strict bank secrecy laws.

The Philippines was earlier included as one of four countries in the list of tax jurisdictions that
have not committed to the IATS. The country was eventually removed from the list prepared by
Organization for Economic Cooperation and Development (OECD) and avoided sanctions.
Gordon: Free patent law to benefit 39 million Filipinos with
untitled lands
Bagumbayan Party presidential bet Sen. Richard J. Gordon is optimistic that approximately 39 million
Filipinos residing on government lands for more than 10 years, would now be able to legally obtain the
lands after the free patent bill is signed into law.

Gordon, author and co-sponsor of Republic Act 10023 or the Free Patent Act which was signed into law
last March 9, said the law extends the grant of free patent, formerly limited to agricultural lands, to
residential lands in all municipalities and cities, given certain conditions, without a need for payment to
the government.

"The Free Patent Act will pave the way for residential landowners, particularly low and middle income
landowners, to title their lands through an easier, speedier and more affordable administrative
proceeding," he said.

"Once they avail of the free patent, many families will be able to sleep better because they have secure
titles to their lands. They will be able to obtain loans from their banks if they need to; bequeath the
property or divide it among their children if they wish to; and get a higher value for their property
because they now have a registered title," he added.

The Free Patent Act, ratified by the two houses of Congress last December, seeks to ease the
requirements and procedures in the titling of residential lands and bring to life such dormant wealth.

Prior to the enactment of the law, landowners could only acquire title through the court under the
present Public Land Act that often resulted in tedious process.

The newly signed RA 10023 cut down the period of eligibility for titling from 30 years to 10 years. Any
Filipino who has paid all the real estate taxes for 10 years shall be entitled to free patent for such parcel
of land in all municipalities and cities. Only alienable lands that are not needed for public service or public
use can be subject to free patent.

Gordon said the free patent law will help the country towards its goal of attaining a robust economy
because it will boost bank lending with better collateral, allow homeowners access to credit in banking
institutions for entrepreneurial or homebuilding activities and reduce the risk of fake titling and land
frauds.

"This law is a good economic stimulus because the land market, arguably the biggest of the markets in
terms of size and value, will perk up, and there will be more land-related transactions and more revenue
for government," the Bagumbayan standard-bearer said.
Land title transfer procedure?
I bought a house 3 years ago, it was a house on bid from the GSIS. i've been planning to transfer the land
title to my name but I don't know where to start.

AND...do you have any ideas of the estimated cost too?(transfer process and taxes, lawyers, etc..)
What are the kinds of taxes i have to pay since this house is from the GSIS, is there any difference if it's
not? I heard the previous owner wasn't able to pay his taxes, do i have to shoulder the unpaid tax?
Please help..i am now based abroad and couldn't stay long if I go back to the Philippines but I want to fix
everything for my siblings.God bless..

2 years ago

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by Jake Tornado

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Best Answer - Chosen by Voters

1. The first step is register your Deed of Absolute Sale with the Registry of Deeds (RD) of the place where
your property is located. You also need to exercise due diligence by asking from the RD a certified true
copy of the seller's title to check whether the title is still clean and there is no other legal impediment to
the transfer to your name.

2. Next, pay the applicable taxes such as the Documentary Stamp Taxe (usually shouldered by the buyer)
and the Capital Gains Tax (usually shouldered by the Seller, in your case, the GSIS). You have to go the
BIR Regional District Office (RDO) which depends upon the location of the property for your tax
assessment, the accomplishment of the applicable BIR Forms and the payment of tax. Since you bought
the property 3 years ago, I assume that the taxes unapid due have earned penalties and surcharges
(since capital gains tax and documentary stamp taxes need to be be paid on or before the 10th day of
the Month following the notarization of the Deed of Absolute Sale). In which case, you may avail of the
Tax Amnesty being offered by the Philippine Government which gives you the option to pay 5% of the
assessed value of the property or P50,000.00 of the tax due, whichever is higher.

3. After paying the taxes, BIR will issue you the Certificate Authorizing Registration (CAR). The CAR is
very important as it authorizes the RD to effect the transfer.

4. You then have to visit the City/Municipal Assessor's Office and ask for a certified true copy of the
latest Tax Declaration as this will be required by the RD to assess your Transfer Fees. You need to pay
the Transfer Fees with the City/Municipal Government where your property is located.

5. After paying the Transfer Fees, go back to the RD and show your Official Receipts and the CAR (from
the BIR) to effect the transfer to your name. It normally takes 2 weeks to about 1 month to issue the
new title in your name. The RD will give you the Owner's Duplicate of Title of your new TCT.

Thus, the total amount of your expenses largely depends upon the assessed taxes and other transfer
fees. Laywers' fees vary depending upon the terms of your engagement. Trust me, lawyers are not
indipensable when it comes to transferring titles as you can do it by yourself without their help.

Hope this helps.