Should I already donate my properties to my kids while I am still alive? What are my options? What taxes should I pay and how much will it be?
We encounter this a lot with our clients. They always ask us to help them transfer their properties in the names of their kids... para wala na silang problema later on.
But how do we actually do this? What’s the process?
Now, this is the question of one of our viewers, Ma. Luisa Gabriel and she writes…
“We are planning to execute a deed of donation of our house and lot to our 3 children. Can we indicate there the exact division of the property, like the land is 200 sqm, we want to give to our youngest 100sqm and the other 2 children 50sqm each. Does the deed of donation requires also an estate tax?”
If you’re having issues transferring your land or have issues transferring the properties of a loved one who passed away, we have something that can help. We recorded an FAQ session where we answered the most common questions related to real property transfers and estate settlement.
You can access the recording by going to www.legalaccess.ph and choosing the 1) transferring land or the 2) estate settlement topics there
Welcome to Legal Guide Philippines where we simplify the law to help you make better choices. I'm Atty. Erwin Zagala and I'm with my partner, Atty. Ramon Ramirez.
We will discuss today related to donating the property to your kids. How do you do it? What needs to be paid?
Putting it all together:
So let’s get back to Ma. Luisa’s question
PARENTS MAY DONATE AND DISTRIBUTE THE REAL PROPERTY TO THEIR CHILDREN. THE PARENTS SHOULD ALSO BE CLEAR ABOUT WHETHER THE DONATION IS INTER VIVOS OR MORTIS CAUSA, AND FOLLOW THE FORMALITIES REQUIRED BY LAW
Can we indicate there the exact division of the property?
YES. INDICATING THE SHARE OF EACH CHILD TO THE LAND WILL PREVENT FUTURE DISPUTES BETWEEN THE CHILDREN. YOU MAY EVEN SUBDIVIDE THE PROPERTY EVEN FURTHER SO THAT THEY EACH HOLD A TITLE.
Does the deed of donation requires also an estate tax?
NO. IF THE PARENTS DECIDE ON AN INTER VIVOS DONATION, THEY WILL HAVE TO PAY THE IMPOSABLE DONOR'S TAX. ESTATE TAX WILL ALSO BE PAYABLE IF THE PROPERTY YOU WILL DONATE TO YOUR KIDS IS STILL IN THE NAME OF SOMEONE WHOSE ESTATE HAS NOT YET BEEN SETTLED.
ADDITIONAL RESOURCES
For most of you, this lesson was more than enough, and if it makes your life easier, then you're welcome. But there are some of you who will watch this episode and end up asking more questions, such as, Attorney, how do we determine what to put in the estate? How do we determine who are the heirs? Or Attorney, what’s the complete process of transferring the properties?
If that's you, then we invite you to check out the "Estate Settlement Guide" workshop (NOT A BOOK) where in as little as 1 hour, we give you a CRASH COURSE ON SUCCESSION LAW and a GENERAL ROADMAP OF THE ENTIRE ESTATE SETTLEMENT FRAMEWORK.
With this guide, you will know exactly where you are in the process regardless of whether you are doing it on your own or if you have hired someone to assist you. You can access this workshop at info.legalguide.ph/estate today.
One last thing... we all want to secure the future of our children. Many times we feel that giving them properties or material wealth will arm them for the future. That’s not always the case. Sometimes…in giving them these things, we send them the wrong message, we teach them the wrong lessons. When we give them properties, let’s examine out intentions clearly. Then when we’re sure, let’s consult a trusted professional to check if donating will be the best way forward.
So wasn't that simple? Now go make better choices.
