Estate Tax Amnesty Extended Until June 14, 2025, Covers Decedents Who Died on or Before May 31, 2022
The Republic Act (RA) No. 11956 lapsed into law on 05 August 2023. It extends the period to avail of the provisions of RA No. 11213 (the Estate Tax Amnesty Act), as amended by RA No. 11569, until 14 June 2025. It provides a one-time Estate Tax Amnesty to settle estate tax obligations through an estate tax amnesty program that will give reasonable tax relief to estates with deficiency estate taxes.
The Estate Tax Amnesty covers the estate of decedents who died on or before May 31, 2022, with or without assessments duly issued therefor, whose estate taxes have remained unpaid or have accrued as of May 31, 2022. The estate may enjoy the immunities and privileges of the Estate Tax Amnesty and pay an estate amnesty tax at the rate of six percent (6%) based on the decedent’s total net estate at the time of death.
Estates covered by the Estate Tax Amnesty, which have fully complied with all the conditions set forth in the Estate Tax Amnesty Act, including the payment of the estate amnesty tax, shall be immune from the payment of all estate taxes, as well as any increments and additions thereto, arising from the failure to pay any and all estate taxes for the period ending May 31, 2022 and prior years, and from all appurtenant civil, criminal, and administrative cases and penalties under the National Internal Revenue Code of 1997, as amended.
To reiterate, the Estate Tax Amnesty covers the estate of decedents who died on or before May 31, 2022 only. It does not exempt the estate from paying the basic estate tax, as the amnesty extends only to penalties, interest, and fines associated with the late payment of said tax.
The availment of the benefits of the Estate Tax Amnesty Act shall observe the requirements and procedure under its Implementing Rules and Regulations to be promulgated by the Bureau of Internal Revenue (BIR). Thus, the BIR has promulgated Revenue Regulations No. 10-2023.
According to the BIR, the Estate Tax Amnesty Return (ETAR) (BIR Form No. 2118-EA) shall be filed and paid, either electronically or manually, by the executor or administrator, legal heirs, transferees or beneficiaries, who wish to avail of the Estate Tax Amnesty within June 15, 2023 until June 14, 2025 with any authorized agent bank, through revenue collection officer of any Revenue District Office (RDO) or authorized tax software provider as defined in Revenue Memorandum Order (RMO) No. 8-2019.
The duly accomplished and sworn ETAR, together with the Acceptance Payment Form (APF-BIR Form No. 0621-EA) and the complete documents shall be presented to the concerned RDO.
The documents to be submitted shall be limited to the following:
A. Mandatory Requirements:
1.Certified True Copy of the Death Certificate (DC) or if not available, the Certificate of No Record of Death from the Philippine Statistics Authority and any valid secondary evidence including but not limited to those issued by any government agency/office sufficient to establish the fact of death of the decedent;
2. Taxpayer Identification Number (TIN) of decedent and heir/s;
3. For “Claims Against the Estate” arising from contract of loan, notarized promissory note, if applicable;
4. Proof of the claimed “Property Previously Taxed,” if any;
5. Proof of the claimed “Transfer for Public Use,” if any; and
6. At least one (1) government issued identification card (ID) of the Executor/Administrator of the Estate, or if there is no executor or administrator appointed, the heirs, transferees, beneficiaries or authorized representative.
B. For Real Property/ies, if any:
1. Certified true copy/ies of the transfer/original condominium certificates of title of real property/ies;
2. Certified true copy of the tax declaration of real property/ies, if untitled including the improvements at the time of death or the succeeding available tax declaration issued nearest to the time of death of the decedent, if none is available at the time of death; and
3. Certificate of No Improvement issued by the accessor’s office at the time of death of the decedent, if applicable.
C. For Personal Property/ies, if applicable:
1. Certificate of Deposit/Investment/Indebtedness owned by the decedent alone or decedent and the surviving spouse, or decedent jointly with other;
2. Certificate of Registration of vehicle/s and other proofs showing the correct value of the same;
3. Certificate of Stocks;
4. Proof of valuation of shares of stock at the time of death; or
5. Proof of valuation of other types of personal property.
D. Other Requirements, if applicable:
1. Duly notarized original Special Power of Attorney (SPA), if the person transacting/ processing the transfer is the authorized representative or one of the heirs, designated as executor/administrator;
2. Certification from the Philippine Consulate or Apostille, if the document is executed abroad; or
3. Location Plan/vicinity map if the zonal value is not readily available.
Provided, however, that in the absence of the abovementioned documents, the Commissioner may request for alternative documents, as may be deemed appropriate.
Within five (5) working days from the receipt of complete documents, the concerned RDO shall either endorse the APF for payment of the estate amnesty tax with the Authorized Agent Banks (AABs), Revenue Collection Officers (RCOs), or authorized tax software provider, or shall notify the taxpayer in case there is any deficiency in the application. Only the duly endorsed APF shall be presented to and received by the AAB, RCO or authorized tax software provider.
Proof of settlement of the estate, whether judicial or extra-judicial, need not accompany the ETAR if it is not yet available at the time of its filing and payment of taxes, but no electronic Certificate Authorizing Registration (eCAR) shall be issued unless such proof is presented and submitted to the concerned RDO.
After payment, the duly accomplished and sworn ETAR and APF with proof of payment, together with the complete documentary requirements, shall be immediately submitted to the concerned RDO in triplicate copies. Failure to submit the same until June 15, 2025 is tantamount to non-availment of the Estate Tax Amnesty and any payment made may be applied against the total regular estate tax due inclusive of penalties.
Installment payment shall be allowed within two (2) years from the statutory date of its payment without civil penalty and interest.
If the Estate Tax Amnesty requirements and procedures appear to be overwhelming and complicated, you should consider asking the advice of an expert, especially a tax lawyer or an estate attorney.
For information related to settlement of estate, you may read our article about it through this link: https://www.arceotandoc.com/single-post/the-process-of-extrajudicial-settlement-of-estate-in-the-philippines.
Arceo Law is a property and estate law office in Quezon City that serves clients anywhere in the Philippines. Its estate and tax lawyers have an extensive experience in facilitating judicial and extrajudicial settlement of estates. Our property and CPA lawyers have successfully advised and represented clients in estate matters. Should you wish to learn more about Estate Tax Amnesty, you may contact us at lawfirm@arceotandoc.com to get in touch with any of our estate attorneys.