No CAR, No Transfer

Not too long ago, the (previous) BIR CAR was required for title transfers. Without it, people wouldn't be able to transfer the title of their property.

This meant that if a seller sold his condo, he would have to present the BIR Certificate Authorizing Registration from when he purchased the property. For example, if someone bought a property from a developer, he would have to keep the BIR CAR from that transaction. When that owner sells the property in the future, he would have to present the CAR to regulators. This document serves as proof that proper taxes were paid when they acquired the property.

Why is this a horror story?

Several condo buildings in BGC never secured BIR CARs when they sold their units. It seems there are pending cases between the tax regulator and these developers. And as such, buyers of these units were prohibited from selling them.

So what happened?

When the new BIR chief was appointed during the Duterte administration, one of the first things he did was to remove the CAR requirement.

And did everyone live happily ever after?

Depending on who's sitting on top, the BIR may revive the CAR requirement. If this happens, people left holding these properties may end up being stuck with them until such time they remove this requirement again.

Lesson: Always include the (previous) BIR CAR in your due diligence. It doesn't always mean that if the title was issued, proper taxes were likely paid. I've heard of cases where sellers have falsified the BIR CAR to transfer the title.

If the seller misplaced it, you may request a certified copy from the BIR.