By Atty Josephrally L Chavez, Jr.
Coverage
The Estate Tax Amnesty under RA No. 11213 covers the estate of decedents who died on or before December 31, 2017, with or without assessments duly issued, whose estate taxes have remained unpaid or have accrued as of December 31, 2017. [Sec. 4]
However, the Estate Tax Amnesty does not extend to estate tax cases which shall have become final and executory and to properties involved in cases pending in appropriate courts: (a) Falling under the jurisdiction of the Presidential Commission on Good Government; (b) Involving unexplained or unlawfully acquired wealth under Republic Act No. 3019, otherwise known as the Anti-Graft and Corrupt Practices Act, and Republic Act No. 7080 or An Act Defining and Penalizing the Crime of Plunder; (c) Involving violations of Republic Act No. 9160, otherwise known as the Anti-Money Laundering Act, as amended; (d) Involving tax evasion and other criminal offenses under Chapter II of Title X of the National Internal Revenue Code of 1997, as amended; and, (e) Involving felonies of frauds, illegal exactions and transactions, and malversation of public funds and property under Chapters III and IV of Title VII of the Revised Penal Code. [Sec. 9]
Entitlement Under Estate Tax Amnesty
The estate may enjoy the immunities and privileges of the Estate Tax Amnesty, to wit: (1) 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; (2) If an estate tax return was previously filed with the Bureau of Internal Revenue, the estate tax rate of six percent (6%) shall be based on net undeclared estate; (3) The provisions of the National Internal Revenue Code of 1997, as amended, or the applicable estate tax laws prevailing at the time of death of the decedent, on valuation, manner of computation, and other related matters shall apply suppletorily, at the time of the entitlement; (4) If the allowable deductions applicable at the time of death of the decedent exceed the value of the gross estate, the heirs, executors, or administrators may avail of the benefits of tax amnesty and pay the minimum estate amnesty tax of Five thousand pesos (₱5,000). [Sec. 5]
Simply put, in no case shall the estate tax due be lower than P5,000. In other words, the minimum estate tax amnesty for the transfer of the estate for each decedent is P5,000.
Availment of the Estate Tax Amnesty; When and Where to File and Pay
The executor or administrator of the estate, or if there is no executor or administrator appointed, the legal heirs, transferees or beneficiaries, who wish to avail of the Estate Tax Amnesty are mandated to:
- Period: Within two (2) years from the effectivity of the Implementing Rules and Regulations (RR 6-2019) – which must be within 2 years from 15 June 2019 or until 15 June 2021, all application for estate amnesty must be filed;
- Place of filing: File with the Revenue District Office of the Bureau of Internal Revenue, which has jurisdiction over the last residence of the decedent, a sworn Estate Tax Amnesty Return, in such forms as may be prescribed in the Implementing Rules and Regulations;
- Manner of payment: The payment of the amnesty tax shall be made at the time the Return is filed;
- Nonresident decedents: The Estate Tax Amnesty Return shall be filed and the corresponding amnesty tax be paid at Revenue District Office No. 39, or any other Revenue District Office which shall be indicated in the Implementing Rules and Regulations.
If the estate involved has properties which are still in the name of another decedent or donor, the present holder, heirs, executors or administrators thereof shall only file one (1) Estate Tax Amnesty Return [ETAR BIR Form No. 2118-EA] and pay the corresponding estate amnesty tax thereon based on the total net estate at the time of death of the last decedent covering all accrued taxes under the National Internal Revenue Code of 1997, as amended, arising from the transfer of such estate from all prior decedents or donors through which the property or properties comprising the estate shall pass:
The appropriate Revenue District Officer shall issue and endorse an acceptance payment form, in such form as may be prescribed in the Implementing Rules and Regulations of this Act for the authorized agent bank, or in the absence thereof, the revenue collection agent or municipal treasurer concerned, to accept the tax amnesty payment. Proof of settlement of the estate, whether judicial or extrajudicial, shall likewise be attached to said Return in order to verify the mode of transfer and the proper recipients:
The availment of the Estate Tax Amnesty and the issuance of the corresponding Acceptance Payment Form do not imply any admission of criminal, civil or administrative liability on the part of the availing estate. [Sec. 6]
Presumption of Correctness of the Estate Tax Amnesty Returns
The Estate Tax Amnesty Returns shall be conclusively presumed as true, correct, and final upon filing thereof, and shall be deemed complete upon full payment of the amount due.
The Acceptance Payment Form, and the Estate Tax Amnesty Return shall be submitted to the Revenue District Office after complete payment. The completion of these requirements shall be deemed full compliance with the provisions of this Act. A Certificate of Availment of the Estate Tax Amnesty shall be issued by the Bureau of Internal Revenue within fifteen (15) calendar days from submission to the Bureau of Internal Revenue of the Acceptance Payment Form and the Estate Tax Amnesty Return. Otherwise, the duplicate copies of the Acceptance Payment Form, stamped as received, and the Estate Tax Amnesty Return shall be deemed as sufficient proof of availment. [Sec. 7]
However, under RR 6-2019 (29 May 2019) provides that the duly accomplished and sworn ETAR, and Acceptance Payment Form (APF) BIR Form No. 0621-EA, together with the complete documents as enumerated in the ETAR, shall be presented to the concerned RDO for endorsement of the APF prior to the payment of the estate tax amnesty with the AABs or RCOs. Note that, only the duly endorsed APF shall be presented to and received by the AAB or RCO. In this regard, RMC 103-2019 dated 25 September 09 prescribes the Revised ETAR & Certificate of Availment. On the other hand, RMC 102-2019 dated 25 September 2019, provides certain clarifications on filing ETAR before the RDO having jurisdiction over the last residence of the decedent in case there are several properties. [See also, RMC 68-2019 dated 1 July 2019 as to who is qualified to avail the ETA under RA no. 11213 and RMC 33-2019 dated 27 June 2019 as to the guidelines and procedures in availing ETA]
Immunities and Privileges
Estates covered by the Estate Tax Amnesty, which have fully complied with all the conditions set forth in this 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 taxable year 2017 and prior years, and from all appurtenant civil, criminal, and administrative cases and penalties under the National Internal Revenue Code of 1997, as amended.
Without prejudice to compliance with applicable laws on succession as a mode of transfer, the Bureau of Internal Revenue, in coordination with the applicable regulatory agencies, shall set up a system enabling the transfer of title over properties to heirs and/or beneficiaries and cash withdrawals from the bank accounts of the decedent, when applicable.
Upon full compliance with all the conditions and payment of the corresponding estate amnesty tax, the tax amnesty granted shall become final and irrevocable. [Sec. 8]
Importance of Payment of Estate Tax
The Registers of Deeds shall not register in the Registry of Property unless the tax had been paid, to wit:
1. Any document transferring real property or real rights therein or
2. Any chattel mortgage, by way of gifts inter vivos or mortis causa, legacy or inheritance, unless a certification from the Commissioner that the transfer tax and actually due thereon had been paid is shown, and they shall immediately notify the Commissioner, Regional Director, Revenue District Officer, or Revenue Collection Officer or Treasurer of the city or municipality where their offices are located. [Sec. 95, NIRC]
SIMPLY PUT, no estate tax payment, the BIR will not issue the e-CAR (Electronic Certificate of Authority to Register), which is the primary document needed before the Register of Deeds process and/or transfer the title over the real property to the respective heirs. For detailed discussion on estate tax, see Transfer Taxes, VAT and Remedies Illustrated and Simplified, 2020 Edition – Volume II, A Guide to Passing the Bar, By: Atty. JLChavez, Jr. [This Article is implored by my good friend – Mabs]
Feel free to email me for any question at atty.jlc@gmail.com
