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Estate tax is a tax imposed on the privilege of transmitting property upon the owner's death. It is based on the value of the gross estate at the time of death. The executor or administrator is responsible for filing an estate tax return within one year, including the value of assets and deductions. If the gross estate exceeds P5 million, the return must be accompanied by a CPA certification. The tax can be paid in full, through installment plans, or partially through property disposition. The executor is personally liable for payment and can request a discharge letter from the BIR once taxes are paid.

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23 views

Group 10

Estate tax is a tax imposed on the privilege of transmitting property upon the owner's death. It is based on the value of the gross estate at the time of death. The executor or administrator is responsible for filing an estate tax return within one year, including the value of assets and deductions. If the gross estate exceeds P5 million, the return must be accompanied by a CPA certification. The tax can be paid in full, through installment plans, or partially through property disposition. The executor is personally liable for payment and can request a discharge letter from the BIR once taxes are paid.

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Estate Tax

Payable
Presented by:
Stephanie Cordero
Zhiara Doronila
Sharilynne Faith Dullesco
Kenn Airie Espanola
What is an Estate Tax
Payable?
Estate Tax is a tax on the right of the deceased person to transmit
his/her estate to his/her lawful heirs and beneficiaries at the time
of death and on certain transfers, which are made by law as
equivalent to testamentary disposition. It is not a tax on property.
It is a tax imposed on the privilege of transmitting property upon
the death of the owner. The Estate Tax is based on the laws in
force at the time of death notwithstanding the postponement of
the actual possession or enjoyment of the estate by the
beneficiary.
Determination of the
Net Taxable Estate
Single resident or
Citizen decedent
Single non-resident or
Alien decedent
Married resident or
Citizen decedent
Married non-resident
Alien decedent
Determination of
Foreign Tax Credit
Single Foreign
Country
The foreign tax credit shall be whichever is lower of the
actual foreign estate tax paid and the following limit:

Foreign net taxable estate x Philippine estate tax due


World net taxable estate
Multiple Foreign
Country
The lower of actual estate tax and the foregoing limit for each
country is determined first. The final foreign tax credit shall
be the lower of the total of the tax credit allowable per
country and the world estate tax credit limit computed as:

Total foreign net taxable estate x Philippine estate tax due


World net taxable estate
Determination of the
Net Taxable Estate
per Country
Determination of Estate
Tax due w/ Multiple
Foreign Countries
Estate Tax Requirements
1. Estate tax return
2. Certified Public Accountant (CPA)
Certification
The Estate Tax Return and its
contents CPA Certification
The executor, administrator or any of the heirs shall Where the value of the gross estate exceeds P5, 000,000,
the return shall be accompanied by a statement certified by
file in duplicate an estate tax return under oath, a Certified Public Accountant.
setting forth the following:
1. Value of gross estate at the point of death or, Contents of the statement :
in the case of non-resident alien that part of 1. Itemized assets of the decedent with their
his gross estate situated in the Philippines. corresponding Gross value at the time of death or, in
2. The deductions allowed from gross estate. the case of a non-resident decedent, that part of his
gross estate situated in the Philippines
3. Supplemental data which may be necessary 2. Itemized deductions from gross estate.
to establish the correct tax. 3. The amount of tax due whether paid or still due and
outstanding.
Deadline of filing the Estate Tax Return Filing Extension
The Commissioner is authorized to grant,
The estate tax return shall be filed within in meritorious cases, a reasonable
one year after the date of death. extension not exceeding 30 days for filing
the return.

Venue of Filing
a. For resident decedents
The administrator or executor shall register the estate of the decedent and secure a new
Tin therefore from the RDO where the decedent is domiciled at the date of his death.
b. For non-resident decedents
Whether non-resident citizen or alien with executor or administrator in the Philippines,
the estate tax return shall be filed and a new Tin shall be secured from the RDO where such
executor or administrator is registered. If he is not registered, the return shall be filed and
new Tin shall be secured form the RDO having jurisdiction of his legal residence.
Where to file the Estate Tax Return?
i. Accredited Agent Bank
ii. Revenue District Office
iii. Collection Agent
iv. Duly authorized Treasurer of the City or
Municipality in which the decedent or
administrator was domiciled at the time of his
death
v. Office of the Commissioner, if the administrator or
executor has no legal residence in the Philippines
Payment of Estate Tax
The estate tax shall be paid at the time the return is
filed following the rule, “ pay as you file”.

Insufficiency of Cash to pay tax


If there is difficulty in paying the tax, the same may be
settled by:
a. Installment payment
b. Partial disposition of estate
Installment Payment
The estate tax may be paid in installment within two
year without the imposition of interest or civil penalties.

Subject to approval of the CIR, the estate tax may be


paid as follows:
a. 24 monthly payments
b. 8 quarterly payments
c. 4 semi-annual payments
d. 2 annual payments
Partial Disposition

Some of the properties of the estate may be conveyed for cash


considerations to be used to settle the estate tax due. A written request for
partial disposition shall be approved by the BIR. The said request shall be
filed, together with a notarized undertaking that the proceeds thereof
shall be exclusively used for the payment of Estate Tax due.
Liability for payment of the Estate Tax
The estate tax shall be paid by the executor or
administrator before delivery to any heir of his
distributive Share of the state. Where there are two or
more executors or administrators, all of them shall be
severally liable for the payment of tax.
Discharge of Executor or
Administrator from Personal
Liability
The executor or administrator shall make a written application for the
Commissioner of the amount of the estate tax and discharge from
personal liability. The executor or administrator, upon payment of the
amount of which he is notified, shall be discharged from personal
liability for any deficiency in the tax thereafter found to be due and
shall be entitled to a receipt in writing showing such discharge.
Thank you for listening!

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