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Category: Real Estate in the Philippines

Various topics on real estate, brokerage and the laws and regulations

  • Retirement and Real Estate: Living in the Philippines After Working Abroad

    “Retirement is a blank sheet of paper. It is a chance to redesign your life into something new and different.”

    – Patrick Foley, Actor and Writer

    By Realttorney®

    For many Filipino-Americans and overseas workers, retiring in the Philippines offers a blend of affordability, cultural familiarity, and tropical beauty. Whether driven by emotional ties or economic advantages, settling down in the Philippines requires careful planning, especially when it comes to real estate, taxation, healthcare, and other legal considerations.

    This guide provides a comprehensive roadmap for retirees looking to transition smoothly into life in the Philippines, covering best places to retire, real estate options, tax implications, healthcare access, and educational institutions.

    🏡 Best Places to Retire in the Philippines

    Choosing the right location depends on the cost of living, healthcare access, and community atmosphere. Some of the most popular retirement destinations include:

    1. Cebu City

    ✅ A balance of urban convenience and coastal charm.

    ✅ Home to top-tier hospitals like Chong Hua Hospital and Cebu Doctors’ University Hospital.

    ✅ Thriving expat community with international restaurants and shopping centers.

    2. Dumaguete

    ✅ Known as the “City of Gentle People,” it offers a low cost of living and a peaceful environment.

    ✅ Home to Silliman Medical Center, a preferred hospital for retirees.

    ✅ Strong expat presence, making integration easier.

    3. Tagaytay

    ✅ Cooler climate, scenic views, and proximity to Metro Manila.

    ✅ Ideal for retirees who want tranquility without isolation.

    ✅ Access to quality healthcare in nearby cities like Makati and Manila.

    4. Iloilo

    ✅ A growing city with modern amenities, yet it retains a laid-back provincial feel.

    ✅ Affordable housing and strong local governance.

    ✅ Access to Western Visayas Medical Center and private hospitals.

    5. Davao City

    ✅ Affordable living, strong security, and access to nature.

    ✅ Home to the Southern Philippines Medical Center, one of the largest hospitals in Mindanao.

    ✅ Strict local policies ensure cleanliness and safety.

    🏠 Real Estate Options: Gated Subdivisions vs. Condos vs. Countryside Homes

    Retirees have several real estate options depending on their lifestyle preferences:

    1. Gated Subdivisions

    ✅ Security & Community – Ideal for those who want 24/7 security, amenities, and a suburban feel.

    ✅ Proximity to Urban Centers – Many subdivisions are located near business districts and hospitals.

    ✅ Higher Property Value – Homes in gated communities tend to appreciate over time.

    2. Condominiums

    ✅ Low-Maintenance Living – Best for retirees who prefer easy upkeep and access to city conveniences.

    ✅ Amenities & Accessibility – Condominium projects often include gyms, pools, and concierge services.

    ✅ Foreign Ownership Allowed – Under the Condominium Act of 1966, foreigners can own condo units as long as foreign ownership in the building does not exceed 40%.

    3. Countryside Homes

    ✅ Privacy & Space – Offers larger lots, gardens, and a slower pace of life.

    ✅ Lower Cost of Living – Rural areas generally have cheaper land and living expenses.

    ✅ Self-Sufficiency – Ideal for retirees who want to grow their own food or live sustainably.

    🛂 SRRV (Special Resident Retiree Visa) and Its Benefits

    The Special Resident Retiree Visa (SRRV) is a great option for foreign retirees, including former Filipinos, who do not wish to apply for dual citizenship. The benefits of this program of the Philippine Retirement Authority include:

    ✅ Multiple-entry privileges with indefinite stay in the Philippines.

    ✅ Exemption from travel taxes when leaving the country.

    ✅ Access to local investments such as real estate and business ventures.

    ✅ Discounts on healthcare and other services.

    Applicants must meet financial requirements, including a deposit ranging from $10,000 to $50,000, depending on age and retirement status.

    💰 Tax Implications for Retirees in the Philippines

    Retirees in the Philippines must consider various tax obligations:

    1. Income Tax. Retirees earning passive income (such as rental income from properties) are subject to graduated income tax rates or a final withholding tax.

    2. Capital Gains Tax (CGT). A 6% tax applies to the sale of real estate classified as a capital asset.

    3. Estate Tax. Retirees planning their estate must consider the 6% estate tax, which applies to the net value of assets transferred upon death.

    4. Real Property Tax. There is an annual ad valorem tax that is imposed by local government units on the ownership of land within their territorial jurisdiction. This is typically 1% to 2% of the assessed value, based on the current schedule of market values.

    🏥 Best Healthcare Options for Retirees

    Access to quality healthcare is a major consideration for retirees. Some of the best hospitals and healthcare providers include:

    ✔️ St. Luke’s Medical Center (Manila & Quezon City) – World-class facilities with international accreditation.

    ✔️Makati Medical Center – A top-tier hospital known for its advanced medical services.

    ✔️Chong Hua Hospital (Cebu) – A leading hospital in the Visayas region.

    ✔️Medical City (Pasig & Clark) – Offers specialized care and wellness programs for retirees.

    ✔️Silliman Medical Center (Dumaguete) – A preferred hospital for retirees in the Visayas.

    Retirees can also enroll in PhilHealth, the national health insurance program, or opt for private health insurance for broader coverage.

    📖 Best Educational Institutions for Retirees in the Philippines

    Many retirees have found comfort, affordability, and fulfillment in the Philippines. Retirement does not have to be the end of educational pursuits. Retirees who wish to share their knowledge and experience may desire to take up part-time teaching positions in these prestigious educational institutions.

    Finally, education may also be an important consideration for retirees who may have children or grandchildren studying in the Philippines, or who simply value access to lifelong learning opportunities. Here’s a look at some of the best educational institutions located near the top retirement destinations in the Philippines:’

    1. Cebu City. The City of Cebu is home to several prestigious universities and schools that cater to both local and international students

    ✔️ University of Cebu (UC) – Offers a wide range of courses, including business, law, and engineering.

    ✔️ University of San Carlos (USC) – One of the oldest universities in the Philippines, known for its strong academic programs.

    ✔️ Cebu Institute of Medicine – A top medical school for retirees interested in healthcare education.

    ✔️ Cebu International School – Ideal for expat families looking for an international curriculum.

    2. Dumaguete. Dumaguete is known as the “University Town” due to its strong academic institutions:

    ✔️ St. Paul University Dumaguete – A private Catholic institution known for its high academic standards.

    ✔️ Negros Oriental Montessori International School – A Montessori-based school emphasizing individualized learning.

    3. Tagaytay. While Tagaytay itself does not have many universities, nearby cities offer excellent options:

    ✔️ De La Salle University – Dasmariñas – A top-tier university located in Cavite, offering business, engineering, and liberal arts programs.

    ✔️ Lyceum of the Philippines University – Cavite – Known for its strong hospitality and tourism programs.

    ✔️ Cavite State University, Don Severino De Las Alas Campus – This is the main campus of the Cavite State University system that was founded in 1906 in the heart of Upland Cavite. It is known for its strong focus on agriculture, particularly in research and development, and its commitment to producing globally competitive nurses and academicians.

    4. Iloilo. The “City of Love” or “Asia’s City of Love” – the nickname of Iloilo City – is a growing educational hub with several reputable institutions:

    ✔️ University of the Philippines Visayas (UPV) – A leading university specializing in fisheries, marine science, and business.

    ✔️ Central Philippine University (CPU) – Offers strong programs in engineering, business, and health sciences.

    ✔️ Iloilo Scholastic Academy – A private school offering international curricula.

    5. Davao City. Davao is home to some of the best universities in Mindanao:

    ✔️ Ateneo de Davao University – A prestigious Jesuit university known for its law, business, and engineering programs.

    ✔️ University of Mindanao – Offers a wide range of courses, including criminology and business administration.

    These institutions provide high-quality education and contribute to the vibrant intellectual and cultural atmosphere of their respective cities. Whether retirees are looking for lifelong learning opportunities, educational institutions for family members, or simply a well-rounded community, these universities and schools enhance the appeal of these retirement destinations.

    ✅ Why It Matters: Making Retirement in the Philippines a Reality

    Retiring in the Philippines offers a unique blend of affordability, cultural familiarity, and a relaxed tropical lifestyle. Whether you are a Filipino-American returning home, an overseas worker planning for retirement, or a foreign retiree seeking a peaceful haven, the Philippines provides diverse real estate options, strong healthcare infrastructure, and financial advantages that make it an attractive retirement destination.

    However, a successful transition requires careful planning. From choosing the right location to understanding tax implications, securing quality healthcare, and designing a retirement home remotely, every step plays a crucial role in ensuring a comfortable and financially stable retirement.

    Your Next Steps: Turning Retirement Plans into Reality

    ✅ Assess Your Retirement Needs – Define your budget, healthcare requirements, and lifestyle preferences.

    ✅ Explore Real Estate Options – Whether it’s a gated subdivision, a condominium unit, or a countryside home, choose a property that aligns with your retirement goals.

    ✅ Understand Tax & Legal Considerations – Ensure compliance with capital gains tax, estate planning, and property ownership laws.

    ✅ Secure Healthcare Coverage – Enroll in PhilHealth or private insurance to guarantee access to top-tier medical facilities.

    ✅ Apply for the SRRV Visa – If eligible, take advantage of the Special Resident Retiree Visa for long-term residency benefits.

    ✅ Consult with Experts – Work with licensed real estate brokers, attorneys, and financial advisors to navigate the complexities of retirement planning.

    Start Planning Today!

    Retirement is not just about relaxation — it’s about security, fulfillment, and making informed decisions. By taking proactive steps, you can ensure a smooth transition into your new life in the Philippines.

    If you’re ready to take the next step, connect with local experts, explore real estate opportunities, and start building your dream retirement home today!

    ——-

    Atty. Jojo is a real estate attorney, an estate planning attorney, a licensed real estate broker, and a PRC-accredited Lecturer/ Speaker for Training Programs in Real Estate. He is committed to helping new and veteran real estate service practitioners, as well as other stakeholders, be well-informed of the latest laws, rules, regulations, and information relevant to the real estate service industry.

  • Legal Insights on Real Estate in Corporate Liquidation

    “Besides a happy policy as to civil government, it is necessary to institute a system of law and jurisprudence founded in justice, equity and public right.”

    – Ezra Stiles, American Education & Theologian

    (Part 3 of 4)

    By Realttorney®

    In the previous article, we covered the background and step-by-step procedures for selling real estate registered in the name of a dissolved corporation. We now turn to discussing several key jurisprudences. The Supreme Court has issued multiple rulings that clarify the extent of a “dead” corporation’s authority and the validity of its transactions post-dissolution.

    These decisions are binding legal precedents and valuable guidance for real estate service professionals.

    ⚖️ Rich v. Paloma III (G.R. No. 210538, March 7, 2018)

    📚 Facts Leading to the Controversy:

    📌 In 1997, Dr. Gil Rich lent ₱1,000,000 to his brother, Estanislao Rich, secured by a real estate mortgage over a 1,000-square-meter parcel of land in Maasin City, Southern Leyte.

    📌 When Estanislao failed to pay, Dr. Rich foreclosed on the property in March 2005 and was declared the highest bidder at the auction.

    📌 Unknown to Dr. Rich, Estanislao had previously mortgaged the same property to Maasin Traders Lending Corporation (MTLC) in January 2005 for ₱2.6 million.

    📌 MTLC, through its president, Ester Servacio, redeemed the property in March 2006, despite being dissolved by the Securities and Exchange Commission in September 2003.

    🌐 Main Issue to be Resolved: Was MTLC legally capable of redeeming the property despite its dissolution?

    💡 Key Legal Principles Applied

    ✅ Corporate Dissolution & Liquidation: The Supreme Court ruled that a dissolved corporation retains no juridical personality except for liquidation purposes. Since MTLC had ceased to exist before the mortgage agreement, it could not validly redeem the property.

    ✅ The Supreme Court reversed the Court of Appeals’ decision and declared the real estate mortgage between Estanislao and MTLC null and void. It also ordered the cancellation of the Deed of Redemption in favor of MTLC.

    ⚖️ Yu v. Yukayguan (G.R. No. 177549, June 18, 2009)

    📚 Facts Leading to the Controversy:

    📌 The case involved a dispute between Anthony S. Yu and Joseph S. Yukayguan, who were half-brothers and stockholders of Winchester Industrial Supply, Inc. (Winchester, Inc.).

    📌 Joseph and his family filed a derivative suit against Anthony and his family, alleging embezzlement, falsification of corporate records, and misappropriation of corporate funds.

    📌 The Regional Trial Court (RTC) of Cebu City dismissed the complaint, ruling that the plaintiffs failed to meet the requirements for a derivative suit.

    🌐 Main Issues to be Resolved: (1) Did the plaintiffs properly exhaust all remedies before filing the derivative suit, and (2) Should the case be remanded for further proceedings given the dissolution of Winchester, Inc.

    💡 Key Legal Principles Applied

    ✅ Requirements for a Derivative Suit: The Supreme Court emphasized that a stockholder must exhaust all available remedies within the corporation before filing a derivative suit. The plaintiffs failed to prove they had done so.

    ✅ Corporate Dissolution & Liquidation: Since Winchester, Inc. had been formally dissolved, the Court of Appeals remanded the case to the RTC to oversee the final settlement of corporate assets.

    ✅ In the end, the Supreme Court affirmed the RTC’s dismissal of the derivative suit but upheld the remand of the case to the RTC for the proper distribution of corporate assets following the dissolution of Winchester, Inc.

    ⚖️ Aguirre v. FQB+7 (G.R. No. 170770, Jan. 9, 2013)

    📚 Facts Leading to the Controversy:

    📌 FQB+7, Inc. was a corporation established in 1985, with its original board of directors and stockholders listed in its Articles of Incorporation.

    📌 In 2002, a General Information Sheet (GIS) was filed with the Securities and Exchange Commission (SEC), reflecting changes in the corporation’s directors and stockholders, including the heirs of a deceased stockholder.

    📌 Vitaliano Aguirre II, a stockholder, discovered the GIS in 2004 and questioned its validity, alleging that the changes were fraudulent and unauthorized.

    📌 Thereafter, Aguirre filed a complaint for intra-corporate dispute, seeking an injunction, inspection of corporate books, and damages.

    🌐 Main Issues to be Resolved: (1) Did the trial court have jurisdiction over the intra-corporate dispute despite the corporation’s dissolution, and (2) Was the GIS valid, and did the respondents have the authority to act as corporate officers?

    💡 Key Legal Principles Applied

    ✅ Jurisdiction Over Intra-Corporate Disputes: The Supreme Court ruled that corporate dissolution does not automatically terminate intra-corporate disputes. Under Section 145 of the old Corporation Code, rights and remedies of stockholders and directors remain enforceable even after dissolution.

    ✅ Corporate Liquidation: A dissolved corporation retains limited juridical personality for the purpose of winding up its affairs, including resolving disputes over stock ownership and corporate governance.

    ✅ Validity of Corporate Acts: The Court emphasized that corporate records, such as GIS filings, must be properly authenticated and that unauthorized changes to corporate governance can be challenged.

    ✅ The Supreme Court partially granted the petition, reinstating the intra-corporate case before the trial court while nullifying the writ of preliminary injunction. It clarified that the dispute should proceed to determine the rightful corporate officers and stockholders.

    ⚖️ Gelano v. Court of Appeals (G.R. No. L-39050, Feb. 24, 1981)

    📚 Facts Leading to the Controversy:

    📌 Insular Sawmill, Inc., a corporation engaged in the lumber business, leased a property owned by Guillermina Mendoza de Gelano in Manila.

    📌 Guillermina’s husband, Carlos Gelano, obtained cash advances from Insular Sawmill amounting to ₱25,950, agreeing that the corporation could deduct the amount from rental payments.

    📌 Carlos failed to fully repay the advances, leaving an unpaid balance of ₱20,000.

    📌 Additionally, the couple made credit purchases of lumber materials worth ₱946.46 for home improvements, which remained unpaid.

    📌 Insular Sawmill also co-signed a promissory note with Carlos for a ₱8,000 loan from China Banking Corporation, which Carlos failed to settle, leaving a balance of ₱4,106.

    📌 Guillermina refused liability, arguing that the debts were personal obligations of her husband.

    🌐 Main Issue to be Resolved: Could Insular Sawmill, Inc. continue prosecuting the case despite its corporate dissolution?

    💡 Key Legal Principles Applied

    ✅ Corporate Dissolution & Litigation: The Supreme Court ruled that a dissolved corporation may continue prosecuting pending cases beyond the three-year winding-up period, provided there is substantial compliance with liquidation procedures.

    ✅ Trustee Representation: Even without a formal trustee, the corporation’s legal counsel was deemed to have substantially fulfilled the role of a trustee for litigation purposes.

    ⚖️ Clemente v. Court of Appeals (G.R. No. 82407, Mar. 27, 1995)

    📚 Facts Leading to the Controversy:

    📌 The case involved a dispute over ownership of a 5,349-square-meter parcel of land in Calamba, Laguna.

    📌 The land was originally acquired by Sociedad Popular Calambeña, an organization that operated as a sociedad anónima (anonymous partnership) from 1909 to 1932.

    📌 The petitioners, including Luis C. Clemente, claimed ownership based on their stockholdings in the dissolved entity.

    📌 The respondents, Elvira Pandinco-Castro and Victor Castro asserted ownership through acquisitive prescription, arguing that they had possessed the land openly and continuously.

    🌐 Main Issues Resolved: (1) Did the petitioners have a valid claim to ownership based on their stockholdings in Sociedad Popular Calambeña, and (2) Could the respondents acquire ownership through acquisitive prescription despite the petitioners’ claims?

    💡 Key Legal Principles Applied

    ✅ Ownership Rights of Dissolved Entities: The Supreme Court ruled that stockholders of a dissolved corporation do not automatically acquire ownership of corporate assets unless proper liquidation procedures are followed.

    ✅ Acquisitive Prescription: The Court upheld the principle that continuous, open, and adverse possession of property for the required period can lead to ownership, provided there is no legal impediment to prescription.

    ✅ Burden of Proof in Ownership Claims: The petitioners failed to establish a clear legal basis for their claim, as they did not present sufficient evidence proving their direct ownership of the land.

    ✅ Hence, the Supreme Court affirmed the Court of Appeals’ decision, rejecting the petitioners’ claim and recognizing the respondents’ ownership through acquisitive prescription.

    ⚖️ Reburiano v. Court of Appeals (G.R. No. 102965, January 21, 1999)

    📚 Facts Leading to the Controversy:

    📌 Pepsi Cola Bottling Company of the Philippines, Inc. filed a case against Urbano Reburiano and James Reburiano for unpaid obligations amounting to ₱55,000.

    📌 The Regional Trial Court (RTC) of Quezon City ruled in favor of Pepsi, ordering the defendants to pay the amount, with deductions for returned empty cases.

    📌 Pepsi appealed to the Court of Appeals, which modified the RTC’s ruling, ordering the defendants to pay ₱55,000 with legal interest from January 1982.

    📌 After the case became final and executory, the RTC issued a writ of execution in 1991.

    📌 The Reburianos moved to quash the writ, arguing that Pepsi had ceased to exist as a corporation in 1983, thus losing its juridical personality to sue or enforce judgments.

    🌐 Main Issues Resolved: Could Pepsi Cola Bottling Company enforce the judgment despite its corporate dissolution?

    💡 Key Legal Principles Applied

    ✅ Corporate Dissolution & Liquidation: The Supreme Court ruled that a dissolved corporation retains limited juridical personality for three years to settle affairs and prosecute pending cases.

    ✅ Trustee Representation: Even without a formal trustee, the corporation’s legal counsel was deemed to have substantially fulfilled the role of a trustee for litigation purposes.

    ✅ Finality of Judgments: The Court emphasized that final and executory judgments must be enforced, and procedural objections raised after finality cannot prevent execution.

    ✅ The Supreme Court affirmed the Court of Appeals’ decision, ruling that Pepsi Cola Bottling Company could still enforce the judgment despite its dissolution. The motion to quash was denied, and the execution of the judgment was upheld.

    ⚖️ Alhambra Cigar & Cigarette Manufacturing Company, Inc., vs. SEC (G.R. No. L-23606, July 29, 1968)

    📚 Facts Leading to the Controversy:

    📌 Alhambra Cigar & Cigarette Manufacturing Company, Inc. was incorporated in 1912 with a corporate term of 50 years, set to expire on January 15, 1962.

    📌 Upon expiration, Alhambra ceased operations and entered liquidation, appointing Angel S. Gamboa as trustee.

    📌 In 1963, Republic Act No. 3531 was enacted, allowing corporations to extend their corporate life beyond the original term.

    📌 Alhambra attempted to amend its Articles of Incorporation to extend its corporate existence for another 50 years.

    📌 The Securities and Exchange Commission (SEC) rejected the amendment, ruling that Republic Act No. 3531 had no retroactive effect and could not apply to corporations whose term had already expired.

    🌐 Main Issues Resolved: Could Alhambra extend its corporate life after its original term had expired?

    💡 Key Legal Principles Applied

    ✅ Corporate Life Extension: The Supreme Court ruled that a corporation cannot extend its existence once its original term has expired. Any amendment must be made before expiration.

    ✅ Non-Retroactivity of Laws: Republic Act No. 3531 did not apply retroactively, meaning corporations that had already ceased to exist could not revive themselves through an amendment.

    ✅ SEC’s Authority: The Court upheld the SEC’s decision, affirming its authority to reject amendments that violate corporate law principles.

    ✅ The Supreme Court affirmed the SEC’s decision, ruling that Alhambra could not extend its corporate life after expiration. The corporation remained in liquidation, and its assets were to be distributed accordingly.

    These are some of the decisions promulgated by the Supreme Court that will guide practitioners to understand the process of dissolution and the underlying legal principles behind it. May this review of related jurisprudence be a valuable tool for all practitioners alike.

    Now, real estate service practitioners play a vital role in safeguarding the legality and integrity of property transactions involving dissolved corporations. Whether the sale is conducted during or after the 3-year liquidation window, it is essential to:

    👉 Identify the correct person or group of persons who is/are authorized to sell the property.

    👉 Conduct proper and exhaustive legal due diligence on the entity and the property subject to the purchase.

    👉 Ensure full legal transparency to protect all parties to the transaction.

    When in doubt, consult a corporate or real estate lawyer familiar with liquidation and estate laws. Ethical practice and legal compliance should always be aligned.

    The last part of the series will discuss the path to resurrecting a “dead” corporation in light of the enactment of the Revised Corporation Code (Rep. Act No. 11232).

    ——-

    Atty. Jojo is a real estate attorney, an estate planning attorney, a licensed real estate broker, and a PRC-accredited Lecturer/ Speaker for Training Programs in Real Estate. He is committed to helping new and veteran real estate service practitioners be well-informed of the latest laws, rules, regulations, and information relevant to the real estate service sector.

  • Guide to Owning Property in the Philippines as a NRF or Dual Citizen

    The law of property determines who owns something, but the market determines how it will be used.”

    – Ronald Coase, British Economist & Noble Laureate

    By Realttorney®
     
    If you’re a Filipino-American, a dual citizen, or a non-resident Filipino (NRF), owning property in the Philippines might feel like coming home – literally and emotionally. But as with anything involving real estate and international ownership, you’ve got to understand the legal and tax rules that come with the territory.
     
    First of all, let’s define: Who is a Non-Resident Filipino or Dual Citizen? Understanding your legal identity is the first crucial step in the process of desiring to buy real estate in the Philippines.
     
    ✅ Dual Citizen
     
    How do you become a dual citizen? Rep. Act No. 9225, known as the “Citizenship Retention and Re-acquisition Act of 2003,” allows natural-born Filipino citizens who have lost their Philippine citizenship because of their naturalization as citizens of a foreign country to be deemed to have re-acquired Philippine citizenship upon taking the oath of allegiance to the Republic specified in the said law.
     
    👉 So, if you are a former natural-born Filipino who has already re-acquired Philippine citizenship, then you retain your U.S. citizenship. As such, in the eyes of the law, you’re now 100% Filipino with all the rights and responsibilities of any other citizen, including ownership of real estate without restrictions.
     
    ✅ Non-Resident Filipino (NRF)
     
    This group includes (1) OFWs; (2) Filipino immigrants who retained Philippine citizenship; and (3) Filipino citizens who live abroad for long periods (but haven’t renounced their citizenship).
     
    👉 The key for this group is that as long as you retain Philippine citizenship, you’re allowed to own land, condominium units, house and lot, and townhouses, etc. – even if you live abroad.
     
    ✅ Former Filipinos
     
    As a side note, former natural-born Filipinos who do not wish to apply for dual citizenship or are not qualified to re-acquire Filipino citizenship according to Rep. Act No. 9225 may still acquire land under the provisions of Batas Pambansa Bilang 185.
     
    Under this law, former natural-born Filipinos can be a transferee of a private land up to one thousand (1,000) square meters, in the case of urban land. But, a former natural-born Filipino may be a transferee of a private land up to an area of one (1) hectare in the case of rural land. The final restriction here is that the private land to be purchased (whether urban or rural land) should be used by the transferee as his residence and not for business purposes.
     
    🏠 What Are Your Property Ownership Rights?
     
    Here’s the good news: if you’re a dual citizen or an NRF, you enjoy full rights to own real estate in the Philippines.
     
    You can legally acquire:
    ✅ Residential lots
    ✅ House-and-lot properties
    ✅ Condominiums
    ✅ Agricultural land
    ✅ Commercial property (with necessary business permits from the LGU)
     
    Just like any Filipino citizen, you can:
     ✅ Buy, sell, or inherit real estate
    ✅ Transfer property to heirs or family
    ✅ Register the title in your name
    ✅ Use the property as rental income, a vacation home, or a retirement residence
     
    📌 Reminder: Foreigners are prohibited from owning land. They may only own condo units or lease land for the long term. Read here if you want to learn more about this topic.
     
    ⚖️ Legal Considerations for Overseas Buyers
     
    Here are some legal factors you must stay on top of as an overseas property owner:
     
    1. Special Power of Attorney (SPA)
     
    Since you’re not physically present in the Philippines, any legal transactions (e.g., signing contracts, submitting documents, paying taxes) will require an SPA authorizing someone in the Philippines to act on your behalf.
     
    ✔️ The SPA must be notarized by the Philippine Consulate in your country.
    ✔️ It should specify exact powers (e.g., to sign, sell, lease, or mortgage property).
    ✔️ Submit this SPA to the Register of Deeds and BIR for proper recognition.
     
    2. Title Registration
     
    Make sure that:
    ✔️ The property is titled under your legal name, and it matches your government ID or Philippine passport.
    ✔️ If the property is inherited or gifted, go through the legal process of estate settlement and register the transfer accordingly.
     
    ⚠️Don’t leave land titles under the names of deceased relatives or informal agreements. This can lead to legal disputes or costly litigation later on.
     
    3. Zoning and Land Use
     
    Some land types (e.g., agricultural, residential, or commercial) have restrictions on what you can build or do with the property.

    ✔️ You may need a conversion certificate if you plan to create a farm tourism business.
    ✔️ Check with the LGU (Local Government Unit) for zoning laws, building permits, and usage rules.
     
    💸 Tax Implications for Dual Citizens and Non-Resident Filipinos
     
    Now, let’s talk about everyone’s favorite topic: taxes. As a property owner in the Philippines, even if you live abroad, you’re still liable for certain taxes.
     
    📌 1. Real Property Tax (RPT)
    ✅Paid annually to the LGU.
    ✅Based on the assessed value of your property.
    ✅Ranges between 1%–2% depending on the classification and assessment level of the property.
     
    💡 Pay before January 31 each year to avoid penalties. Or better yet, you can pay the RPT in advance and get a twenty percent (20%) discount for the incoming full year’s RPT. You can assign this task to a representative in the Philippines.
     
    📌 2. Capital Gains Tax (CGT)
    ✅Applicable when you sell a property, whether you incur an actual gain or not.
    ✅The rate is 6% of the gross selling price or the current schedule of market value (whichever is higher).
    ✅Paid by the seller (but often negotiated).
     
    📍Even if you’re a non-resident, you must file and pay CGT through the Bureau of Internal Revenue (BIR) before title transfer.
     
    📌 3. Documentary Stamp Tax (DST)
    ✅Paid by the buyer at a rate of 1.5%.
    ✅Applies when executing a Deed of Absolute Sale, Donation, or Mortgage Agreement, among other documents.
     
    📌 4. Donor’s Tax
    ✅Applicable when gifting property to another person.
    ✅Taxed at 6% of the current schedule of market value of the donated property.
    ✅Exemptions apply for gifts up to P250,000 in value, annually.
     
    📌 5. Estate Tax
    When the owner passes away, the heirs must pay estate tax before they can legally transfer ownership.
    ✅Rate: 6% of the net estate (after deductions).
    ✅Heirs must file within 1 year from the date of death.
     
    ✔️ Pro Tip: Create an Estate Plan if you own real property here in the Philippines. It will make estate settlement easier for your immediate family later on.
     
    🌐 Do You Need to File Income Taxes in the Philippines?
     
    It depends on whether your property is income-generating.
     
    ✔️ If You Lease or Rent Out Your Property:
    ✅You are considered to be earning income in the Philippines.
    ✅You must register with the BIR and pay:
    ✅Income tax (depending on rental income)
    ✅Value-added tax (VAT) or percentage tax, if applicable
     
    You may hire a Philippine accountant to help you file the necessary returns annually. Failure to register and pay taxes can result in penalties.
     
    ❌ If You Do Not Earn Any Philippine-Sourced Income:
     
    You are not required to file income taxes in the Philippines. But you’re still responsible for property taxes, and you must properly report any sale or transfer of property.
     
    💼 Can You Open a Bank Account or Get a Loan as a Dual Citizen?
     
    Yes. In fact, most banks in the Philippines allow dual citizens and non-resident Filipinos to:
    ✅ Open peso or dollar accounts
    ✅ Apply for housing loans, auto loans, and even investment loans
     
    However, most banks will require:
    ✅ Proof of income (COE or payslips)
    ✅ TIN and government-issued ID
    ✅ Dual citizenship certificate (if applicable)
     
    Some banks have special programs tailored for OFWs and overseas buyers — check out BDO, BPI, Security Bank, or RCBC for their “home loan for foreigners or overseas Filipinos” programs.
     
    ✈️ Key Takeaways
     
    Owning property in the Philippines as a non-resident or dual citizen isn’t just a dream — it’s a well-supported legal right. But to make it stress-free and financially sound, you need to:
     
    ✅ Know your rights under Philippine laws
    ✅ Register everything properly with the Registry of Deeds and BIR
    ✅ Keep up with annual tax obligations
    ✅ Avoid common legal mistakes by hiring licensed professionals
     
    And always — always — leave a clear paper trail for your heirs or representatives, especially if your property is meant to be passed on.
     
    📚 BONUS: Quick Checklist
     
    Here’s your quick reference guide:
     
    ✅ Dual citizenship certificate or proof of Filipino citizenship
    ✅ Valid Philippine Tax Identification Number (TIN)
    ✅ Annual RPT payment receipt
    ✅ SPA (if managing from abroad)
    ✅ Legal ownership documents (TCT/CCT, tax dec, etc.)
    ✅ Draft or notarized Philippine will (if applicable)
    ✅ Hire a PRC-licensed real estate broker and a real estate attorney
    ✅ Consult a CPA, if earning rental income
     
    📞 Need Help with Your Property Taxes or Legal Setup?
     
    If you’re based in the U.S. and need help:
     
    ✅Filing your Philippine taxes
    ✅Drafting a Special Power of Attorney
    ✅Reviewing a Deed of Sale or Title
    ✅Creating an estate plan for your properties – real and personal – in the Philippines
     
    📩 Reach out to a licensed Philippine real estate lawyer or estate planning expert who specializes in overseas Filipino clients.
     
    ——-
     
    Atty. Jojo is a real estate attorney, an estate planning attorney, a licensed real estate broker, and a PRC-accredited Lecturer/ Speaker for Training Programs in Real Estate. He is committed to helping new and veteran real estate service practitioners be well-informed of the latest laws, rules, regulations, and information relevant to the real estate service sector.
     

  • Step-by-Step Guide to Selling Real Estate Owned by a “Dead” Corporation

    “We should all be obliged to appear before a board every 5 years and justify our existence… on the pain of liquidation.”

    – George Bernard Shaw, Irish Playwright and Political Activist

    (Part 2 of 4)

    By Realttorney®

    In Part 1 of this series, we discussed how corporations in the Philippines may be dissolved and how their legal personality is extended for a limited period to allow for liquidation. We now turn to the practical steps for selling real estate still registered in the name of a corporation that has lost its corporate franchise, commonly referred to as a “dead” corporation.

    Depending on whether the sale occurs within or beyond the three-year winding-up period provided by law, the procedure varies. Licensed real estate brokers, lawyers, and buyers alike need to know which rules apply.

    Scenario A: Sale Within the 3-Year Liquidation Period

    If the corporation is dissolved but the three-year liquidation period under Section 139 of the Revised Corporation Code has not yet expired, the corporation retains limited legal capacity to dispose of its property.

    Here are the procedural steps:

    1. Confirm the Dissolution Status. Obtain a Certificate of Dissolution from the Securities and Exchange Commission (SEC). Then, verify the effective date of dissolution and compute the expiration of the 3-year window.

    2. Review the Articles of Dissolution. Check if liquidators or trustees have been designated. If not, the board of directors may continue to act for liquidation purposes as long as it is within the 3-year period.

    3. Secure Corporate Authority to Sell. A board resolution must be issued by the board of liquidators or remaining directors, authorizing the sale of the specific property.

    4. Conduct Legal Due Diligence. Verify that the Torrens title is clean and under the corporation’s name. Thereafter, check the tax declaration, ensure that real estate taxes are current, and identify any liens or encumbrances, if any.

    5. Execute the Deed of Sale. The corporation, represented by its liquidator, signs the Deed of Absolute Sale. It is important to emphasize that the buyer must be informed that the seller is a dissolved corporation acting only within its winding-up capacity.

    6. Comply with BIR Requirements. Pay Capital Gains Tax (CGT), Documentary Stamp Tax (DST), and Value-Added Tax (VAT) if applicable. After a few weeks, kindly secure the Certificate Authorizing Registration (CAR) from the Bureau of Internal Revenue (BIR). This is one requirement for the payment of transfer tax at the Local Treasurer’s Office.

    7. Register the Sale. Submit the Deed (or transferring document), the CAR, and other required documents to the Registry of Deeds. Pay the registration fees and process the cancellation and issuance of the new title.

    Scenario B: Sale After the 3-Year Liquidation Period

    Once the three-year period lapses, the corporation loses its capacity to act, including the authority to sell property. However, the law provides remedies through trusteeship or court-supervised liquidation.

    1. Check for Trust Assignment. Determine whether the corporation executed a trust assignment of its assets to named trustees before the 3-year period ended. If so, the trustees now have the authority to sell the property.

    2. If No Trustees Were Appointed. Under some jurisprudence, the assets of the corporation are held in trust for the benefit of stockholders. This means that the stockholders now own the property pro indiviso (undivided) and must act collectively.

    3. Initiate SEC or Court Action if Necessary. If disputes arise, the parties may petition the SEC or a Regional Trial Court to appoint a liquidator or approve a partition. This is common when there are missing or uncooperative shareholders.

    4. Execute the Sale Through Trustees or Stockholders. On the first hand, the trustees may execute the sale through a Trust Deed. On the other hand, if stockholders are selling the property themselves, they must first agree on and execute a partition, either judicially or extrajudicially.

    5. Process BIR and Title Transfer. The sale is subject to standard tax compliance (payment of CGT, DST, VAT, etc.). Kindly note that title transfer may require proof of succession or trust assignment, along with updated corporate or stockholder documentation.

    Risk Management and Ethical Considerations

    Practitioners should be mindful of the following risks:

    1. The absence of designated liquidators may delay transactions.

    2. Simulated sales or transactions without proper authority may be void.

    3. Buyers must be fully informed of the dissolved status of the selling entity.

    4. Brokers may face administrative or civil liability if they facilitate a legally defective transaction.

    In conclusion, even a “dead” corporation can sell its real estate under Philippine law, but only under certain conditions and within certain timeframes. Whether within or beyond the 3-year liquidation period, strict compliance with legal procedures, BIR rules, and SEC documentation is essential.

    In the third part of this series, we will examine key Supreme Court decisions that provide insight into the legal treatment of corporate liquidation and property disposition.

    ——-

    Atty. Jojo is a real estate attorney, an estate planning attorney, a licensed real estate broker, and a PRC-accredited Lecturer/ Speaker for Training Programs in Real Estate. He is committed to helping new and veteran real estate service practitioners be well-informed of the latest laws, rules, regulations, and information relevant to the real estate service sector.

  • How Can a “Dead” Corporation Sell Its Real Estate in the Philippines?

    “There is something fundamentally wrong in treating the Earth as if it were a business in liquidation.”

    – Herman E. Daly, American Economist

    (Part 1 of 4)

    By Realttorney®

    On April 24, 2025, I attempted to answer this question during the Continuing Professional Development (CPD) seminar sponsored by my mother chapter, REBAP Metro Tagaytay.

    Real estate service practitioners (RESPs) in the Philippines occasionally encounter a peculiar situation: a parcel of land or a piece of property remains registered under the name of a corporation that no longer operates. This scenario prompts a legal and practical question: Can a “dead” corporation still sell its real estate? If so, how?

    For those who missed the CPD Event, this article explores the legal framework and procedures involved in the sale of real estate assets owned by a dissolved corporation, often referred to as a “dead” corporation. Drawing from the Revised Corporation Code of the Philippines (Republic Act No. 11232), relevant SEC regulations, and Supreme Court jurisprudence, we offer a proficient guide for real estate service professionals, lawyers, and estate planners alike.

    The Rise and Fall of Family Corporations. During the late 1970s up to the 1990s, it was common for Filipino families to form corporations as vehicles for managing their businesses and real estate assets. This strategy offered benefits such as:

    • Easier access to capital through institutional financing
    • Trust and control within the family structure
    • Efficient estate planning and intergenerational wealth transfer

    However, many of these corporations eventually became inactive or failed to comply with the annual regulatory filings, such as audited financial statements (AFS) and general information sheets (GIS). As a result, they were either administratively dissolved by the Securities and Exchange Commission (SEC) or voluntarily terminated by their shareholders.

    The assets of these dissolved corporations – including real estate – remain under their name on record, leading to legal complexities when a sale is contemplated.

    What Does It Mean for a Corporation to “Die”? Under Philippine law, the “death” of a corporation refers to the termination of its juridical existence. This may occur in several ways:

    1. Non-organization or non-operation. If a corporation fails to formally organize or start its business within two (2) years under Batas Pambansa Blg. 68 [now five (5) years under R.A. No. 11232], it is deemed dissolved.
    • Inoperative status. If a corporation becomes continuously inactive for five (5) consecutive years, it may be placed under delinquent status, and if it fails to comply with SEC requirements within the next six (6) months, the SEC may revoke its certificate of incorporation.
    • Non-filing of reports. Failure to file financial statements or GIS for three instances within five years also results in delinquency and possible revocation under SEC Memorandum Circular No. 19, Series of 2023.

    Once a corporation’s certificate of incorporation is revoked, it can no longer conduct business as a juridical entity, except for one purpose: liquidation.

    Understanding Dissolution vs. Liquidation. To appreciate how a “dead” corporation may still sell its real estate, we must distinguish between two key concepts.

    First, DISSOLUTION. Dissolution is the legal termination of the corporation’s existence. It is the formal end of its corporate life and may be: (1) voluntary, initiated by the shareholders or board of directors; or (2) involuntary, imposed by the SEC for violations such as inoperation or failure to file reports.

    It should be noted that once dissolved, a corporation ceases to exist for regular business purposes.

    Second, LIQUIDATION. Liquidation is the process that follows dissolution. It involves: (1) settling debts and liabilities; (2) collecting receivables; (3) disposing of corporate properties; and (4) distributing remaining assets to shareholders.

    The Revised Corporation Code (Section 139) provides that a corporation remains a body corporate for three years from the effective date of dissolution, but only for liquidation purposes. It cannot resume business operations, but it may still convey or sell property as part of winding up its affairs.

    The Three-Year Winding-Up Rule

    According to Section 139 of the Revised Corporation Code, “Every corporation whose corporate existence is terminated in any manner shall nevertheless remain as a body corporate for three (3) years… to settle and close its affairs, dispose of and convey its property, and distribute its assets…”

    This provision ensures that the corporation’s residual obligations can be fulfilled and that its assets are not stranded. It allows the appointment of liquidators or trustees to manage the sale of properties, including real estate.

    However, once the three-year winding-up period expires, the corporation no longer retains any capacity to act – unless its remaining assets were previously transferred to trustees.

    Why Is This Relevant to Real Estate Brokers and Other Professionals? In the real estate service practice, professionals often encounter situations where:

    • A parcel of land is titled under a long-dissolved corporation.
    • There is no designated liquidator or board resolution authorizing the sale.
    • The three-year liquidation window has already lapsed.

    Understanding how to legally facilitate the sale of such properties is not only crucial for compliance but also for protecting buyer interests and the integrity of licensed real estate brokers.

    In the next part of this series, we will explore the step-by-step procedure for selling real estate owned by a dissolved corporation, depending on whether the transaction occurs within or after the three-year liquidation period.

    Stay tuned for Part 2: “Step-by-Step Guide to Selling Real Estate Registered in the Name of a Dissolved Corporation.”

    ——-

    Atty. Jojo is a real estate attorney, an estate planning attorney, a licensed real estate broker, and a PRC-accredited Lecturer/ Speaker for Training Programs in Real Estate. He is committed to helping new and veteran real estate service practitioners be well-informed of the latest laws, rules, regulations, and information relevant to the real estate service sector.