REAL ESTATE SALE DATE

Pop quiz for real estate pros 👀

A property in Quezon City was sold.

• Deed of Absolute Sale (DOAS) signed: January 10

• Notarized: January 11

• Buyer’s payment deposit slip dated: January 5 (yes, this can happen)

Now here’s the question that trips people up:

👉 When does the BIR consider the sale to have happened?

And… when is the Capital Gains Tax due?

*********

Circling back to Monday’s pop quiz…here’s the answer.

The BIR may ("may" not will) treat January 5 — the date on the deposit slip — as the true date of sale. If so, the Capital Gains Tax may be considered due on February 4 or 5, depending on the method of counting.

Now wait — isn’t the reckoning date supposed to be the date of notarization of the Deed of Absolute Sale (DOAS)?

Yes. In most clean, normal transactions.

But tax law doesn’t stop at documents.

The BIR applies a principle called substance over form.

And this is where the deposit slip becomes dangerous.

When the seller receives full payment before the DOAS is signed and notarized, it raises a red flag:

👉 the sale may have already happened, and the document was executed later just to reset deadlines.

In BIR language, that’s no longer just a late document.

That can be seen as a simulated or postdated execution of sale.

Think about this scenario:

Let’s assume the parties really agreed and completed the sale on January 5 (same day as the deposit).

But the buyer missed the tax deadlines.

So they execute a new DOAS on January 11, get it notarized, and try to pretend the sale happened later.

Creative? Yes.

Effective? No.

Because once payment, control, and benefits have transferred, the BIR can legally treat the earlier date as the true date of sale — regardless of what the DOAS says.

That’s why deposit slips, checks, possession, and other acts matter.

They don’t automatically control the date — but they can override the document if they contradict it.

Lesson:

In tax, consistency is everything.

The more conflicting dates you create, the more control you give the BIR to decide the outcome for you.