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Repossession of Property by Government

Last December 2013, it was all over the news that the Local Government of Quezon City had shut down the Manila Seedling Bank for failure to pay their real property taxes between 2001 and 2011.

Is your property next?

I hope that got your attention. The deadline for the annual payment of real property taxes passed last January 31, 2014. So, have you paid your real property taxes?

If not, don’t fret, you can still pay in instalments, and the deadlines are on March 31, June 30, September 30, and December 31.

The January 31 deadline is for the full payment of the annual real property tax, usually with discounts as much as 20%.

2 Reasons why you should pay real property taxes (RPT)

1. Your property can be included in the next tax delinquent properties auction

 Payment of RPT is your obligation as a property owner, and if not paid, the local government may auction your property in their next tax delinquent properties auction. Of course, no one wants to have their property auctioned off, and this alone should be enough reason to pay! .

2. A Tax Clearance is required if you are going to sell your property

Please note that a real property tax clearance is required before you can transfer the ownership of a property through the title and tax declaration, and you can only get a tax clearance if your real property taxes are paid in full.

What are the reasons why people don’t pay real property taxes?

Obviously, it would take many years of non-payment of real property taxes before it will be included in a tax delinquent properties auction, which brings me to my next question: “What are the reasons why people don’t pay real property taxes?”

Aside from the obvious that the property owner might be in the middle of a financial hardship, you would be surprised that there are instances where people have too may properties, and they lose track and simply forgot to pay taxes for some of them.

Another possible reason for first-time homeowners is they don’t know that they have to pay real property taxes. Hard to believe but true.

For example, condo owners  mistakenly think their association dues already include payment for real property taxes. More often than not, condo dues only include payment for real property taxes of common areas, which means the condo owner still has to pay for the RPT of their condo unit. If in doubt, ask your condo admin to be sure.

Mistakes can also happen where properties are included in an auction even if real property taxes have been paid… so make sure you keep all your receipts as this will serve as proof that your taxes have been paid!

Sometimes the owner is out of the country and unless they come home, they have no way to pay their real property taxes. (I believe this can be solved by an online RPT payment system just like what Paranaque City used to have… I wonder what happened to that system?).

The same applies if you are too busy and you have no time to pay your real property taxes, although personally, I believe you should set aside time for this. Ideally, you should pay the RPT for the coming year in December of the current year. Aside from taking advantage of the discounts for early payment, there are usually no lines, and you can finish faster.

Another option that comes to mind would be to just let someone pay your real property taxes for you… just outsource it!

You can outsource the payment of RPT

If you are a very busy person and have no time to personally pay the RPT, especially if your properties are spread over a large geographical area, you can outsource the payment of RPT.

Just look for a trusted person you can rely on to pay your real property taxes for you.

If you will ask us if we can recommend someone, we highly recommend OMI Land Title Services (OMI-LTS). We have availed of their title transfer services and we are very satisfied with them. Aside from RPT payment and title transfer, they also do title verification, reconstitution, and other services.


From Cherry Castillo, Foreclosure Philippines