Estate Taxation

Question 1

Deductions allowed to NRA

Answer 1

• Prorated CLUT (PHGE/WOGE),
• TPU,
• Vanishing Deduction,
• P500,000 standard deduction,
• Net Share of the Surviving Spouse

Question 2

Formula for Net Taxable Estate

Answer 2

Gross Estate
(CLUT)
(TPU)
(Vanishing Deduction)
(RA4917 Amts Rcvd by Heirs-Retirement Benefits*)
-------------------------------
Net Estate before Special Deductions
(Standard Deduction)
(Family Home)
(RA4917 Amts Received by Heirs-Retirement Benefits)*-1/2only?
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Net Estate before Share of Surviving Spouse
(Share of Surviving Spouse)
--------------------------------
Net Taxable Estate
x6%
---------------------------------
PET Due
(Foreign Tax Credit)- PETDuexFoNTE/WoNTE v Actual v PETDUExToFoNTE/ToWoNTE
---------------------------------
PET Payable
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Question 3

When are you not required to file estate tax?

Answer 3

If the gross value of the estate consists of non-registrable property not exceeding P5,000,000

Question 4

Time of payment of estate tax due

Answer 4

5 years if judicial settlement and 2 yrs if extrajudicial settlement.

Question 5

Properties considered located in the Philippines

Answer 5

• Shares, receivables, issued by an foreign corp 85% of business located in the Philippines
• Franchise exercisable in PH
• Shares or rights in any pshp or business est. in PH
• Any personal property, whether tangible or intangible located in PH

Question 6

Exempt Transfers

Answer 6

• Transfer under SPA
• Delivery of inheritance by the fiduciary heir to the fideicommissary
• Properties held in trust by decedent
• Transfers by way of bona fide sales