Professional Documents
Culture Documents
TRANSFER TAXES
BASIC CONCEPTS
TRANSFER TAXES
Tax
SALES OF SHARES Sale, barter, exchange Not securities dealer Listed and traded in stock exchange
TAX RATE
1/2
of 1% of value Exemption
- IPO
GROSS ESTATE
Filipino or
resident
FILIPINO OR RESIDENT ALIEN Real property whereever situated Personal property wherever situated
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NON RESIDENT ALIEN Real property situated in Phil. Personal property situated in Phil.
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in contemplation of death
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Decedent retained for his life or any period not ascertainable w/o reference to death
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- The possession or
enjoyment of, the right to income from the property
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Exception
- Bona fide sale - adequate - full consideration
REVOCABLE TRANSFER Transfer subject to any change at death By decedent alone or with any person
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Exception
- Bona fide sale - adequate - full consideration
PASSING UNDER GENERAL POWER OF APPOINTMENT General power of appt Exercised by decedent
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In
contemplation of or intended to
- Take effect in possession or enjoyment - at or after death
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By deed retained for his life or any period not ascertainable w/o reference to death
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- The possession or enjoyment of, the right to income from the property
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Exception
- Bona fide sale - adequate - full consideration
insufficient consideration
EXCLUSIONS
Capital
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Bequests, devices, legacies or transfers to social welfare, cultural and charitable institutions
Beneficiary
- Estate, exectr, admtr, - NOTA, revocable
DEDUCTIONS
Filipino
or resident
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The Family Home Standard deduction Medical expenses Amount received by heirs under R.A. No. 4917 Share in conjugal property
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DEDUCTIBILTY
Non-resident alien - Include in estate return - Value of gross estate not situated in the Philippines
EXPENSES
Funeral expenses Judicial expenses of the testamentary or intestate proceedings
DEDUCTIBILITY
Filipino, res. alien: - Actual funeral expenses,
or 5% of gross estate, not to exceed P200,000
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FUNERAL EXPENSES
Mourning apparel: spouse, unmarried, minor Expenses for the wake Publication for death ads Telecommunications
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Cost of burial plot, tombstones, monument or mausoleum but not upkeep Interment and/or cremation fees and charges Other expenses incurred
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NOT FUNERAL
Expenses incurred after interment: prayers, masses Portion of funeral and burial expenses borne by friends and relatives
JUDICIAL EXPENSES
Inventory taking of assets Administration Payment of debts Distribution of estate among the heirs
EXAMPLES
Fees of executor or administrator Attorneys fees Court fees Accountants fees
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Appraisers fees Clerk hire Cost of preserving and distributing the estate Cost of storing or maintaining estate property
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CLAIMS
Filipino, res. alien: - Against the estate
- Duly notarized instrument - W/in 3 years before death statement of disposition
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Claims of the deceased - Against insolvents - Value included in the gross estate Non-resident alien: - Proportion which claims
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INDEBTEDNESS
Filipino, res. alien: Unpaid mortgages - Value of interest in the
property undiminished by the mortgage is included in estate
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LOSSES
Filipino, res. alien:
- Incurred during estates settlement - Arising from fires, storms, shipwreck, or other casualties,or from theft,
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robbery, embezzlement not insured - Not claimed as deduction in ITR - Incurred not later than last day for payment of estate tax
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TAXES
DEDUCTIBLE Filipino, res. alien:
- Income tax upon income received before death - Property taxes accrued before death
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NON-DEDUCTIBLE
- Income taxes upon income received after
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Situated in the Phil. Person who died 5 years prior to the death of the decedent Property identifiable as
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REDUCTION RATES 100% one year prior 80% not more than 2 years 60% not more than 3 years 40% not more than 4 years 20% not more than 5 years
CONDITIONS
Estate/donors tax paid Value used for determining estate/donors tax Included in gross estate No previous PPT
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Deductions for mortgage for estate/donors but paid prior to death, reduce the PPT deduction Two or more items use the aggregate value
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Allowable deduction is reduced by amount which bears the same ratio to deductions for expenses, etc., as the amount otherwise deductible for PPT
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FORMULA
Value of PPT Less: Mortgage debt paid (1st) First basis Value of gross estate of dec. Less: Expenses,etc. 2nd deduction
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First basis Less: 2nd deduction Second basis Multiplied by 100%, 80%, etc. Vanishing deduction
FAMILY HOME
Filipinos and res. aliens Current market value Not exceeding P1million Certified by the barangay captain of the locality
STANDARD DEDUCTION
Filipinos and res. Aliens P 1 million
MEDICAL EXPENSES
Filipinos and res. Aliens Incurred by decedent One year prior to death Substantiated by receipts Not exceeding P500 K
PROHIBITION ON WITHDRAWAL
Bank with knowledge of death of a person with a bank deposit - alone,or - jointly with another
VALUATION
USUFRUCT, ANNUITY - Beneficiarys probable life
- In accordance with the latest Basic Standard Mortality Table
VALUATION
PROPERTY IN GENERAL - Personal - CAFMV
- Real w/ever is higher * BIR FMV = zonal * Assessors value
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NOTICE OF DEATH
Transfers subject tax or Exempt from tax G.V. exceeds P200K Executor, administrator, or any legal heir
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PLACE OF FILING
Resident register and secure
TIN with RDO of domicile Non-resident with executor RDO executor registered No executor Office of Com
through RDO39-South QC
PAYMENT OF TAXES
At time return filed Extendible for - 5 years judicial - 2 years extrajudicial
Subsidiary liability
Beneficiary
ESTATE PLANNING
DONORS TAX
Excise tax on inter vivos transfers Not on property On trust or otherwise, direct or indirect, etc.
STRANGER 30%
Not brother or sister, spouse, ancestor and lineal descendant Relative by consanguinity w/in 4th degree
EXEMPTIONS
Not over P100 K Dowries up to P10 K Use of Govt. Educational, etc. Political donations
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Prizes and awards to athletes - local and intl - held in RP or abroad - sanctioned by N.S.A.
DO NOT
FORGET
GOOD LUCK !
CONGRATULATIONS
THANK YOU
AND A GOOD DAY TO ALL