11/05/2026
🏛️ What is Transfer Tax? (Simple Explanation)
Transfer Tax is a tax paid to the local government unit (LGU) when the ownership of a property is transferred.
In simple terms:
👉 It is the fee required to transfer the property from the seller to the buyer.
💡 When is it paid?
• After the sale transaction
• Before the title can be transferred to the buyer’s name
📊 How much is it?
• Usually around 0.5% – 0.75% of the property value
• The rate depends on the city or municipality
⚠️ Important:
• The buyer usually pays for it (unless otherwise agreed upon)
• It is required to process the title transfer
• There is a deadline — penalties may apply for late payment
📌 Simple breakdown of taxes:
• CGT (Capital Gains Tax) = usually paid by the seller (tax on the sale/profit)
• DST (Documentary Stamp Tax) = tax on legal documents
• Transfer Tax = tax for transferring property ownership
📌 Bottom line:
Transfer Tax is the tax required to legally transfer the property to the new owner.
⚠️ Disclaimer: This content is for educational purposes only. Always consult licensed professionals before making any real estate decisions.