Estate Tax

tax imposed on the transfer of property from the decedent to the heirs. It is an excise
tax on the privilege/right to transfer property gratuitously at the time of death.
tax imposed on the transfer of property from the decedent to the heirs. It is an excise
tax on the privilege/right to transfer property gratuitously at the time of death.
Gratuitous transfer
With out consideration
Donation mortis causa
Estate tax
Takes effect upon the death of the decedent
Transfer tax are classified as
excise tax
Tax on rights and privileges
What is Estate Tax
• Tax on the Estate
• Tax on the Decedent
• Tax on the Heirs
• Tax on the right to transfer property
What is Estate Tax
• Tax on the Estate
• Tax on the Decedent
• Tax on the Heirs
• Tax on the right to transfer property
What is Estate Tax
• Income Tax
• Business Tax
• Percentage Tax
• Excise Tax
What is Estate Tax
• Income Tax
• Business Tax
• Percentage Tax
• Excise Tax
What is Estate Tax
• National Tax
• Ad Valorem Tax
• Tax on the right to transfer property
• Excise Tax
• Direct Tax
• Proportionate Tax
 Succession
a mode of acquisition by virtue of which the property, rights and obligations to the
extent of the value of the inheritance, of a person are transmitted through his death to
another or others either by his will or by operation of law.
 Succession
a mode of acquisition by virtue of which the property, rights and obligations to the
extent of the value of the inheritance, of a person are transmitted through his death to
another or others either by his will or by operation of law.
Elements of succession
Decedent
Estate
Heirs
By his will or Testamentary
succession
Ordinary Will/ Attested
Holographic Will
Will/ Notarial Will
 By operation of law or
INTESTATE SUCCESION
Mixed succession
Both testamentary and intestate
Estate

Real Property Personal Property

Devise Legacy

Devisee Legatee
 Classification
    With In ph With Out Ph    
Resident Citizen   Yes Yes    
Non Resident Citizen   Yes Yes    
Resident Alien   Yes Yes    
Non Resident Alien   Yes No    
           
    Real Property Personal Property    
Non Resident Alien   Yes Yes    
    Personal Property      
Intangible
Intangible Without With rule of
    Tangible rule of Reciprocity   Reciprocity
    Yes Yes   No
 Classification
    With In ph With Out Ph    
Resident Citizen   Yes Yes    
Non Resident Citizen   Yes Yes    
Resident Alien   Yes Yes    
Non Resident Alien   Yes No    
           
    Real Property Personal Property    
Non Resident Alien   Yes Yes    
    Personal Property      
Intangible
Intangible Without With rule of
    Tangible rule of Reciprocity   Reciprocity
    Yes Yes   No

Same Lang ang classification sa

Donors Tax
Situs of Intangible Property
• Intangible properties considered situated in the Philippines The following shall be
considered as situated in the Philippines (among others):
• a) Franchise which must be exercised in the Philippines;
• b) Shares, obligations or bonds issued by any corporation or Sociedad anonima
organized and constituted in the Philippines in accordance with its law;
• c) Shares, obligations or bonds issued by any foreign corporation 85% of the
business of which is located in the Philippines;
• d) Shares, obligations or bonds issued by any foreign corporation if such shares,
obligations or bonds have acquired a business situs in the Philippines;
• e) Shares or rights in any partnership, business or industry established in the
Philippines.
Situs of Intangible Property
• Intangible properties considered situated in the Philippines The following shall be
considered as situated in the Philippines (among others):
• a) Franchise which must be exercised in the Philippines;
• b) Shares, obligations or bonds issued by any corporation or Sociedad anonima
organized and constituted in the Philippines in accordance with its law;
• c) Shares, obligations or bonds issued by any foreign corporation 85% of the
business of which is located in the Philippines;
• d) Shares, obligations or bonds issued by any foreign corporation if such shares,
obligations or bonds have acquired a business situs in the Philippines;
• e) Shares or rights in any partnership, business or industry established in the
Philippines.
Completeness of the estate
• Gross estate (SEC. 85) –
• The value of the gross estate of the decedent shall be determined by
including the value at the time of his death of all property, real or
personal, tangible or intangible, wherever situated: Provided,
however, that in the case of a non-resident decedent who at the time
of his death was not a citizen of the Philippines, only that part of the
entire gross estate which is situated in the Philippines shall be
included in his taxable estate. It shall also include revocable transfers
and transfer for insufficient consideration etc. (R.R. 12-2018)
Completeness of the estate
• Gross estate (SEC. 85) –
• The value of the gross estate of the decedent shall be determined by
including the value at the time of his death of all property, real or
personal, tangible or intangible, wherever situated: Provided,
however, that in the case of a non-resident decedent who at the time
of his death was not a citizen of the Philippines, only that part of the
entire gross estate which is situated in the Philippines shall be
included in his taxable estate. It shall also include revocable transfers
and transfer for insufficient consideration etc. (R.R. 12-2018)
Completeness of the estate
• Properties owned by the decedent
 Real Properties
 Family Home
 Personal Properties
 Business Interest
 Properties transferred (Taxable Transfers)
Completeness of the estate
• Properties transferred (Taxable Transfers)
• These are properties which at the time of the death of the decedent
are not part of the decedent’s assets because these were already
transferred (sold or donated) by him during his lifetime.
• The values of these properties will be included in determining the
value of the gross estate even though such properties are not
anymore part of the assets of the decedent
Completeness of the estate
• Properties transferred (Taxable Transfers)
Transfer in Contemplation of Death
Revocable Transfer
Property Passing Under General Power of Appointment
Transfer of Property for an Insufficient Consideration
Transfer with retention or reservation of certain rights
Completeness of the estate
• Properties transferred (Taxable Transfers)
• Transfer in Contemplation of Death - is a transfer of property
motivated by the thought of death, although death may not be
imminent.
• Examples of a transfer made in contemplation of death
• 1) When the transferor of a property is at an advanced age.
• 2) When the transferor of a property is terminally ill or with incurable
disease.
• 3) When a person concurrently makes a will and transfers a property.
Completeness of the estate
• Properties transferred (Taxable Transfers)
• Transfer in Contemplation of Death - is a transfer of property
motivated by the thought of death, although death may not be
imminent.
• Examples of a transfer made in contemplation of death
• 1) When the transferor of a property is at an advanced age.
• 2) When the transferor of a property is terminally ill or with incurable
disease.
• 3) When a person concurrently makes a will and transfers a property.
Transfer in Contemplation of Death
• - is a transfer of property motivated by the thought of death, although death may not be imminent.
 1) When the transferor of a property is at an advanced age.
 2) When the transferor of a property is terminally ill or with incurable disease.
 3) When a person concurrently makes a will and transfers a property.
 Exception: in case of a bona fide sale for an adequate and full consideration in money or money's worth

 Examples of motives that preclude a transfer from the category of one made in contemplation of death (Motives
associated with life)
 1) To relieve donor from the burden of management
 2) To save income or property taxes
 3) To settle family litigate and un-litigated disputes
 4) To provide independent income for dependents
 5) To see the children enjoy the property while the donor is alive
 6) To protect the family from hazards of business operations, and
 7) To reward services rendered
Transfer in Contemplation of Death
• - is a transfer of property motivated by the thought of death, although death may not be imminent.
 1) When the transferor of a property is at an advanced age.
 2) When the transferor of a property is terminally ill or with incurable disease.
 3) When a person concurrently makes a will and transfers a property.
 Exception: in case of a bona fide sale for an adequate and full consideration in money or money's worth

 Examples of motives that preclude a transfer from the category of one made in contemplation of death (Motives
associated with life)
 1) To relieve donor from the burden of management
 2) To save income or property taxes
 3) To settle family litigate and un-litigated disputes
 4) To provide independent income for dependents
 5) To see the children enjoy the property while the donor is alive
 6) To protect the family from hazards of business operations, and
 7) To reward services rendered
Revocable Transfer
• - is a transfer where the enjoyment of the property maybe altered,
amended or revoked.
• Whether or not on or before the date of the decedent's death notice
has been given or the power to revoke has been exercised, such
notice shall be considered to have been given, or the power to revoke
have been exercised, on the date of his death.
Revocable Transfer
• - is a transfer where the enjoyment of the property maybe altered,
amended or revoked.
• Whether or not on or before the date of the decedent's death notice
has been given or the power to revoke has been exercised, such
notice shall be considered to have been given, or the power to revoke
have been exercised, on the date of his death.
Property Passing Under General Power of
Appointment

Grand father

Father

Son Son
Property Passing Under General Power of
Appointment

Grand father

Father

Father Pwede mo yan

Ipamana kay Son 1 lan
Son Son
Property Passing Under General Power of
Appointment

Grand father

Father Died

Father Pwede mo yan

Ipamana kay Son 1 lan
Son
Transfer of Property for an Insufficient
Consideration
• If the transfers, trusts, interests, rights or powers is made, created,
exercised or relinquished for a consideration in money or money's
worth, but is not a bona fide sale for an adequate and full
consideration in money or money's worth, there shall be included in
the gross estate only the excess of the fair market value, at the time
of death, of the property otherwise to be included on account of such
transaction, over the value of the consideration received therefor by
the decedent.
Transfer of Property for an Insufficient
Consideration
• If the transfers, trusts, interests, rights or powers is made, created,
exercised or relinquished for a consideration in money or money's
worth, but is not a bona fide sale for an adequate and full
consideration in money or money's worth, there shall be included in
the gross estate only the excess of the fair market value, at the time
of death, of the property otherwise to be included on account of such
transaction, over the value of the consideration received therefor by
the decedent.
 VALUE OF
FMV OF PROPERTY TO
CONSIDERATION PROPERTY AT THE BE
FMV AT THE TIME RECEIVED FOR TIME INCLUDED IN
OF TRANSFER TRANSFER OF OF DEATH OF THE THE GROSS
CASE OF PROPERTY PROPERTY DECEDENT ESTATE

1 ₱100,000.00 ₱110,000.00 ₱120,000.00 ₱0.00

2 ₱100,000.00 ₱100,000.00 ₱120,000.00 ₱0.00
3 ₱100,000.00 ₱90,000.00 ₱120,000.00 ₱30,000.00
4 ₱100,000.00 ₱0.00 ₱120,000.00 ₱120,000.00
5 ₱100,000.00 ₱90,000.00 ₱80,000.00 ₱0.00
 VALUE OF
FMV OF PROPERTY TO
CONSIDERATION PROPERTY AT THE BE
FMV AT THE TIME RECEIVED FOR TIME INCLUDED IN
OF TRANSFER TRANSFER OF OF DEATH OF THE THE GROSS
CASE OF PROPERTY PROPERTY DECEDENT ESTATE

1 ₱100,000.00 ₱110,000.00 ₱120,000.00 ₱0.00

2 ₱100,000.00 ₱100,000.00 ₱120,000.00 ₱0.00
3 ₱100,000.00 ₱90,000.00 ₱120,000.00 ₱30,000.00
4 ₱100,000.00 ₱0.00 ₱120,000.00 ₱120,000.00
5 ₱100,000.00 ₱90,000.00 ₱80,000.00 ₱0.00
 VALUE OF
FMV OF PROPERTY TO
CONSIDERATION PROPERTY AT THE BE
FMV AT THE TIME RECEIVED FOR TIME INCLUDED IN
OF TRANSFER TRANSFER OF OF DEATH OF THE THE GROSS
CASE OF PROPERTY PROPERTY DECEDENT ESTATE

1 ₱100,000.00 ₱110,000.00 ₱120,000.00 ₱0.00

2 ₱100,000.00 ₱100,000.00 ₱120,000.00 ₱0.00
3 ₱100,000.00 ₱90,000.00 ₱120,000.00 ₱30,000.00
4 ₱100,000.00 ₱0.00 ₱120,000.00 ₱120,000.00
5 ₱100,000.00 ₱90,000.00 ₱80,000.00 ₱0.00
 VALUE OF
FMV OF PROPERTY TO
CONSIDERATION PROPERTY AT THE BE
FMV AT THE TIME RECEIVED FOR TIME INCLUDED IN
OF TRANSFER TRANSFER OF OF DEATH OF THE THE GROSS
CASE OF PROPERTY PROPERTY DECEDENT ESTATE

1 ₱100,000.00 ₱110,000.00 ₱120,000.00 ₱0.00

2 ₱100,000.00 ₱100,000.00 ₱120,000.00 ₱0.00
3 ₱100,000.00 ₱90,000.00 ₱120,000.00 ₱30,000.00
4 ₱100,000.00 ₱0.00 ₱120,000.00 ₱120,000.00
5 ₱100,000.00 ₱90,000.00 ₱80,000.00 ₱0.00
 VALUE OF
FMV OF PROPERTY TO
CONSIDERATION PROPERTY AT THE BE
FMV AT THE TIME RECEIVED FOR TIME INCLUDED IN
OF TRANSFER TRANSFER OF OF DEATH OF THE THE GROSS
CASE OF PROPERTY PROPERTY DECEDENT ESTATE

1 ₱100,000.00 ₱110,000.00 ₱120,000.00 ₱0.00

2 ₱100,000.00 ₱100,000.00 ₱120,000.00 ₱0.00
3 ₱100,000.00 ₱90,000.00 ₱120,000.00 ₱30,000.00
4 ₱100,000.00 ₱0.00 ₱120,000.00 ₱120,000.00
5 ₱100,000.00 ₱90,000.00 ₱80,000.00 ₱0.00
 VALUE OF
FMV OF PROPERTY TO
CONSIDERATION PROPERTY AT THE BE
FMV AT THE TIME RECEIVED FOR TIME INCLUDED IN
OF TRANSFER TRANSFER OF OF DEATH OF THE THE GROSS
CASE OF PROPERTY PROPERTY DECEDENT ESTATE

1 ₱100,000.00 ₱110,000.00 ₱120,000.00 ₱0.00

2 ₱100,000.00 ₱100,000.00 ₱120,000.00 ₱0.00
3 ₱100,000.00 ₱90,000.00 ₱120,000.00 ₱30,000.00
4 ₱100,000.00 ₱0.00 ₱120,000.00 ₱120,000.00
5 ₱100,000.00 ₱90,000.00 ₱80,000.00 ₱0.00
Transfer with retention or reservation of
certain rights
• (possession or enjoyment of, or the right to the income from the
property, or the right to designate a person who may exercise such
right
Determine which of the following events are considered as taxable transfers.  
Property transferred inter vivos, transferor is of advanced age and died within 3 years after the date of
transfer. Taxable Transfer
Property sold for adequate and full consideration, transferor/seller died after one day because of incurable
disease. Not Taxable

Property sold for P1,000,000. The FMV of the property sold was P 1,100,000. Taxable Transfer

Property transferred, transferor has the right to take back the property. Taxable Transfer
Property transferred, transferor has the right to take back the property. The transferor has waived his right
before he died. Not Taxable

Property transferred, the transferee has the power to appoint or transfer to anybody the said property. Taxable Transfer
Property transferred, the transferee has the power to appoint or transfer the said property as designated by
the transferor. Not Taxable
Property transferred, the transferor has the right to the income of the property transferred while he is still
alive. Taxable Transfer
Property donated, Donor’s tax paid. In the deed of donation, the donor expressly reserved for himself the
usufruct over the property Taxable Transfer
Determine which of the following events are considered as taxable transfers.  
Property transferred inter vivos, transferor is of advanced age and died within 3 years after the date of
transfer. Taxable Transfer
Property sold for adequate and full consideration, transferor/seller died after one day because of incurable
disease. Not Taxable

Property sold for P1,000,000. The FMV of the property sold was P 1,100,000. Taxable Transfer

Property transferred, transferor has the right to take back the property. Taxable Transfer
Property transferred, transferor has the right to take back the property. The transferor has waived his right
before he died. Not Taxable

Property transferred, the transferee has the power to appoint or transfer to anybody the said property. Taxable Transfer
Property transferred, the transferee has the power to appoint or transfer the said property as designated by
the transferor. Not Taxable
Property transferred, the transferor has the right to the income of the property transferred while he is still
alive. Taxable Transfer
Property donated, Donor’s tax paid. In the deed of donation, the donor expressly reserved for himself the
usufruct over the property Taxable Transfer
Determine which of the following events are considered as taxable transfers.  
Property transferred inter vivos, transferor is of advanced age and died within 3 years after the date of
transfer. Taxable Transfer
Property sold for adequate and full consideration, transferor/seller died after one day because of incurable
disease. Not Taxable

Property sold for P1,000,000. The FMV of the property sold was P 1,100,000. Taxable Transfer

Property transferred, transferor has the right to take back the property. Taxable Transfer
Property transferred, transferor has the right to take back the property. The transferor has waived his right
before he died. Not Taxable

Property transferred, the transferee has the power to appoint or transfer to anybody the said property. Taxable Transfer
Property transferred, the transferee has the power to appoint or transfer the said property as designated by
the transferor. Not Taxable
Property transferred, the transferor has the right to the income of the property transferred while he is still
alive. Taxable Transfer
Property donated, Donor’s tax paid. In the deed of donation, the donor expressly reserved for himself the
usufruct over the property Taxable Transfer
Determine which of the following events are considered as taxable transfers.  
Property transferred inter vivos, transferor is of advanced age and died within 3 years after the date of
transfer. Taxable Transfer
Property sold for adequate and full consideration, transferor/seller died after one day because of incurable
disease. Not Taxable

Property sold for P1,000,000. The FMV of the property sold was P 1,100,000. Taxable Transfer

Property transferred, transferor has the right to take back the property. Taxable Transfer
Property transferred, transferor has the right to take back the property. The transferor has waived his right
before he died. Not Taxable

Property transferred, the transferee has the power to appoint or transfer to anybody the said property. Taxable Transfer
Property transferred, the transferee has the power to appoint or transfer the said property as designated by
the transferor. Not Taxable
Property transferred, the transferor has the right to the income of the property transferred while he is still
alive. Taxable Transfer
Property donated, Donor’s tax paid. In the deed of donation, the donor expressly reserved for himself the
usufruct over the property Taxable Transfer
Determine which of the following events are considered as taxable transfers.  
Property transferred inter vivos, transferor is of advanced age and died within 3 years after the date of
transfer. Taxable Transfer
Property sold for adequate and full consideration, transferor/seller died after one day because of incurable
disease. Not Taxable

Property sold for P1,000,000. The FMV of the property sold was P 1,100,000. Taxable Transfer

Property transferred, transferor has the right to take back the property. Taxable Transfer
Property transferred, transferor has the right to take back the property. The transferor has waived his right
before he died. Not Taxable

Property transferred, the transferee has the power to appoint or transfer to anybody the said property. Taxable Transfer
Property transferred, the transferee has the power to appoint or transfer the said property as designated by
the transferor. Not Taxable
Property transferred, the transferor has the right to the income of the property transferred while he is still
alive. Taxable Transfer
Property donated, Donor’s tax paid. In the deed of donation, the donor expressly reserved for himself the
usufruct over the property Taxable Transfer
Determine which of the following events are considered as taxable transfers.  
Property transferred inter vivos, transferor is of advanced age and died within 3 years after the date of
transfer. Taxable Transfer
Property sold for adequate and full consideration, transferor/seller died after one day because of incurable
disease. Not Taxable

Property sold for P1,000,000. The FMV of the property sold was P 1,100,000. Taxable Transfer

Property transferred, transferor has the right to take back the property. Taxable Transfer
Property transferred, transferor has the right to take back the property. The transferor has waived his right
before he died. Not Taxable

Property transferred, the transferee has the power to appoint or transfer to anybody the said property. Taxable Transfer
Property transferred, the transferee has the power to appoint or transfer the said property as designated by
the transferor. Not Taxable
Property transferred, the transferor has the right to the income of the property transferred while he is still
alive. Taxable Transfer
Property donated, Donor’s tax paid. In the deed of donation, the donor expressly reserved for himself the
usufruct over the property Taxable Transfer
Determine which of the following events are considered as taxable transfers.  
Property transferred inter vivos, transferor is of advanced age and died within 3 years after the date of
transfer. Taxable Transfer
Property sold for adequate and full consideration, transferor/seller died after one day because of incurable
disease. Not Taxable

Property sold for P1,000,000. The FMV of the property sold was P 1,100,000. Taxable Transfer

Property transferred, transferor has the right to take back the property. Taxable Transfer
Property transferred, transferor has the right to take back the property. The transferor has waived his right
before he died. Not Taxable

Property transferred, the transferee has the power to appoint or transfer to anybody the said property. Taxable Transfer
Property transferred, the transferee has the power to appoint or transfer the said property as designated by
the transferor. Not Taxable
Property transferred, the transferor has the right to the income of the property transferred while he is still
alive. Taxable Transfer
Property donated, Donor’s tax paid. In the deed of donation, the donor expressly reserved for himself the
usufruct over the property Taxable Transfer
Determine which of the following events are considered as taxable transfers.  
Property transferred inter vivos, transferor is of advanced age and died within 3 years after the date of
transfer. Taxable Transfer
Property sold for adequate and full consideration, transferor/seller died after one day because of incurable
disease. Not Taxable

Property sold for P1,000,000. The FMV of the property sold was P 1,100,000. Taxable Transfer

Property transferred, transferor has the right to take back the property. Taxable Transfer
Property transferred, transferor has the right to take back the property. The transferor has waived his right
before he died. Not Taxable

Property transferred, the transferee has the power to appoint or transfer to anybody the said property. Taxable Transfer
Property transferred, the transferee has the power to appoint or transfer the said property as designated by
the transferor. Not Taxable
Property transferred, the transferor has the right to the income of the property transferred while he is still
alive. Taxable Transfer
Property donated, Donor’s tax paid. In the deed of donation, the donor expressly reserved for himself the
usufruct over the property Taxable Transfer
Determine which of the following events are considered as taxable transfers.  
Property transferred inter vivos, transferor is of advanced age and died within 3 years after the date of
transfer. Taxable Transfer
Property sold for adequate and full consideration, transferor/seller died after one day because of incurable
disease. Not Taxable

Property sold for P1,000,000. The FMV of the property sold was P 1,100,000. Taxable Transfer

Property transferred, transferor has the right to take back the property. Taxable Transfer
Property transferred, transferor has the right to take back the property. The transferor has waived his right
before he died. Not Taxable

Property transferred, the transferee has the power to appoint or transfer to anybody the said property. Taxable Transfer
Property transferred, the transferee has the power to appoint or transfer the said property as designated by
the transferor. Not Taxable
Property transferred, the transferor has the right to the income of the property transferred while he is still
alive. Taxable Transfer
Property donated, Donor’s tax paid. In the deed of donation, the donor expressly reserved for himself the
usufruct over the property Taxable Transfer
Determine which of the following events are considered as taxable transfers.  
Property transferred inter vivos, transferor is of advanced age and died within 3 years after the date of
transfer. Taxable Transfer
Property sold for adequate and full consideration, transferor/seller died after one day because of incurable
disease. Not Taxable

Property sold for P1,000,000. The FMV of the property sold was P 1,100,000. Taxable Transfer

Property transferred, transferor has the right to take back the property. Taxable Transfer
Property transferred, transferor has the right to take back the property. The transferor has waived his right
before he died. Not Taxable

Property transferred, the transferee has the power to appoint or transfer to anybody the said property. Taxable Transfer
Property transferred, the transferee has the power to appoint or transfer the said property as designated by
the transferor. Not Taxable
Property transferred, the transferor has the right to the income of the property transferred while he is still
alive. Taxable Transfer
Property donated, Donor’s tax paid. In the deed of donation, the donor expressly reserved for himself the
usufruct over the property Taxable Transfer
Business Interest (Interests, rights and claims
of the decedent existing at the time of death)
• Proceeds of Life Insurance
• Claims against insolvent persons
• Amount received by heirs under R.A. No. 4917
• Prior interest/Decedent’s interest
Proceeds of Life Insurance

• 1). The amount receivable by the estate of the deceased, his executor, or
administrator, as insurance under policies taken out by the decedent upon his own life,
irrespective of whether or not the insured retained the power of revocation, or to the
extent of the amount receivable by any beneficiary designated in the policy of
insurance, except when it is expressly stipulated that the designation of the beneficiary
is irrevocable.
• 2) The following are also not taxable:
a) proceeds/benefits coming from SSS
b) proceeds/benefits coming from GSIS.
c) proceeds coming from group insurance.
• 3) When the designation of the beneficiary is not stated or is not clear, the Insurance
Code assumes revocable designation
Proceeds of Life Insurance

• 1). The amount receivable by the estate of the deceased, his executor, or
administrator, as insurance under policies taken out by the decedent upon his own life,
irrespective of whether or not the insured retained the power of revocation, or to the
extent of the amount receivable by any beneficiary designated in the policy of
insurance, except when it is expressly stipulated that the designation of the beneficiary
is irrevocable.
Automatic Kasama Sa
• 2) The following are also not taxable: gross estate kapag ito
a) proceeds/benefits coming from SSS ang beneficiary ng
Life Insurance
b) proceeds/benefits coming from GSIS.
c) proceeds coming from group insurance.
• 3) When the designation of the beneficiary is not stated or is not clear, the Insurance
Code assumes revocable designation
Proceeds of Life Insurance

• 1). The amount receivable by the estate of the deceased, his executor, or
administrator, as insurance under policies taken out by the decedent upon his own life,
irrespective of whether or not the insured retained the power of revocation, or to the
extent of the amount receivable by any beneficiary designated in the policy of
insurance, except when it is expressly stipulated that the designation of the beneficiary
is irrevocable.
Automatic Kasama Sa
• 2) The following are also not taxable: gross estate kapag ito
a) proceeds/benefits coming from SSS ang beneficiary ng
Life Insurance
b) proceeds/benefits coming from GSIS.
c) proceeds coming from group insurance.
• 3) When the designation of the beneficiary is not stated or is not clear, the Insurance
What if the beneficiary
Code assumes revocable designation of the SSS or GSIS is the
Estate? Is it part of the
gross estate?
Determine which proceeds of life insurance will be included in the gross estate  
Proceeds of life insurance, daughter of the insured was irrevocably designated as the beneficiary of the Not
life insurance. Included
Proceeds of life insurance, wife of the insured was revocably designated as the beneficiary of the life
insurance. Included
Proceeds of life insurance, the beneficiary’s designation was not stated in the insurance policy. Included
Proceeds of life insurance, the administrator of the estate was revocably designated as beneficiary of the
life insurance. Included
Proceeds of life insurance, the executor of the estate was irrevocably designated as beneficiary of the life
insurance. Included
Not
Benefits received from SSS, beneficiary was irrevocably designated as beneficiary. Included
Not
Benefits from GSIS, beneficiary was revocably designated as beneficiary. Included
Proceeds of life insurance, the estate was designated as beneficiary of it. Included
Not
Proceeds of life insurance from group insurance. Included
Determine which proceeds of life insurance will be included in the gross estate  
Proceeds of life insurance, daughter of the insured was irrevocably designated as the beneficiary of the Not
life insurance. Included
Proceeds of life insurance, wife of the insured was revocably designated as the beneficiary of the life
insurance. Included
Proceeds of life insurance, the beneficiary’s designation was not stated in the insurance policy. Included
Proceeds of life insurance, the administrator of the estate was revocably designated as beneficiary of the
life insurance. Included
Proceeds of life insurance, the executor of the estate was irrevocably designated as beneficiary of the life
insurance. Included
Not
Benefits received from SSS, beneficiary was irrevocably designated as beneficiary. Included
Not
Benefits from GSIS, beneficiary was revocably designated as beneficiary. Included
Proceeds of life insurance, the estate was designated as beneficiary of it. Included
Not
Proceeds of life insurance from group insurance. Included
Determine which proceeds of life insurance will be included in the gross estate  
Proceeds of life insurance, daughter of the insured was irrevocably designated as the beneficiary of the Not
life insurance. Included
Proceeds of life insurance, wife of the insured was revocably designated as the beneficiary of the life
insurance. Included
Proceeds of life insurance, the beneficiary’s designation was not stated in the insurance policy. Included
Proceeds of life insurance, the administrator of the estate was revocably designated as beneficiary of the
life insurance. Included
Proceeds of life insurance, the executor of the estate was irrevocably designated as beneficiary of the life
insurance. Included
Not
Benefits received from SSS, beneficiary was irrevocably designated as beneficiary. Included
Not
Benefits from GSIS, beneficiary was revocably designated as beneficiary. Included
Proceeds of life insurance, the estate was designated as beneficiary of it. Included
Not
Proceeds of life insurance from group insurance. Included
Determine which proceeds of life insurance will be included in the gross estate  
Proceeds of life insurance, daughter of the insured was irrevocably designated as the beneficiary of the Not
life insurance. Included
Proceeds of life insurance, wife of the insured was revocably designated as the beneficiary of the life
insurance. Included
Proceeds of life insurance, the beneficiary’s designation was not stated in the insurance policy. Included
Proceeds of life insurance, the administrator of the estate was revocably designated as beneficiary of the
life insurance. Included
Proceeds of life insurance, the executor of the estate was irrevocably designated as beneficiary of the life
insurance. Included
Not
Benefits received from SSS, beneficiary was irrevocably designated as beneficiary. Included
Not
Benefits from GSIS, beneficiary was revocably designated as beneficiary. Included
Proceeds of life insurance, the estate was designated as beneficiary of it. Included
Not
Proceeds of life insurance from group insurance. Included
Determine which proceeds of life insurance will be included in the gross estate  
Proceeds of life insurance, daughter of the insured was irrevocably designated as the beneficiary of the Not
life insurance. Included
Proceeds of life insurance, wife of the insured was revocably designated as the beneficiary of the life
insurance. Included
Proceeds of life insurance, the beneficiary’s designation was not stated in the insurance policy. Included
Proceeds of life insurance, the administrator of the estate was revocably designated as beneficiary of the
life insurance. Included
Proceeds of life insurance, the executor of the estate was irrevocably designated as beneficiary of the life
insurance. Included
Not
Benefits received from SSS, beneficiary was irrevocably designated as beneficiary. Included
Not
Benefits from GSIS, beneficiary was revocably designated as beneficiary. Included
Proceeds of life insurance, the estate was designated as beneficiary of it. Included
Not
Proceeds of life insurance from group insurance. Included
Determine which proceeds of life insurance will be included in the gross estate  
Proceeds of life insurance, daughter of the insured was irrevocably designated as the beneficiary of the Not
life insurance. Included
Proceeds of life insurance, wife of the insured was revocably designated as the beneficiary of the life
insurance. Included
Proceeds of life insurance, the beneficiary’s designation was not stated in the insurance policy. Included
Proceeds of life insurance, the administrator of the estate was revocably designated as beneficiary of the
life insurance. Included
Proceeds of life insurance, the executor of the estate was irrevocably designated as beneficiary of the life
insurance. Included
Not
Benefits received from SSS, beneficiary was irrevocably designated as beneficiary. Included
Not
Benefits from GSIS, beneficiary was revocably designated as beneficiary. Included
Proceeds of life insurance, the estate was designated as beneficiary of it. Included
Not
Proceeds of life insurance from group insurance. Included
Determine which proceeds of life insurance will be included in the gross estate  
Proceeds of life insurance, daughter of the insured was irrevocably designated as the beneficiary of the Not
life insurance. Included
Proceeds of life insurance, wife of the insured was revocably designated as the beneficiary of the life
insurance. Included
Proceeds of life insurance, the beneficiary’s designation was not stated in the insurance policy. Included
Proceeds of life insurance, the administrator of the estate was revocably designated as beneficiary of the
life insurance. Included
Proceeds of life insurance, the executor of the estate was irrevocably designated as beneficiary of the life
insurance. Included
Not
Benefits received from SSS, beneficiary was irrevocably designated as beneficiary. Included
Not
Benefits from GSIS, beneficiary was revocably designated as beneficiary. Included
Proceeds of life insurance, the estate was designated as beneficiary of it. Included
Not
Proceeds of life insurance from group insurance. Included
Determine which proceeds of life insurance will be included in the gross estate  
Proceeds of life insurance, daughter of the insured was irrevocably designated as the beneficiary of the Not
life insurance. Included
Proceeds of life insurance, wife of the insured was revocably designated as the beneficiary of the life
insurance. Included
Proceeds of life insurance, the beneficiary’s designation was not stated in the insurance policy. Included
Proceeds of life insurance, the administrator of the estate was revocably designated as beneficiary of the
life insurance. Included
Proceeds of life insurance, the executor of the estate was irrevocably designated as beneficiary of the life
insurance. Included
Not
Benefits received from SSS, beneficiary was irrevocably designated as beneficiary. Included
Not
Benefits from GSIS, beneficiary was revocably designated as beneficiary. Included
Proceeds of life insurance, the estate was designated as beneficiary of it. Included
Not
Proceeds of life insurance from group insurance. Included
Determine which proceeds of life insurance will be included in the gross estate  
Proceeds of life insurance, daughter of the insured was irrevocably designated as the beneficiary of the Not
life insurance. Included
Proceeds of life insurance, wife of the insured was revocably designated as the beneficiary of the life
insurance. Included
Proceeds of life insurance, the beneficiary’s designation was not stated in the insurance policy. Included
Proceeds of life insurance, the administrator of the estate was revocably designated as beneficiary of the
life insurance. Included
Proceeds of life insurance, the executor of the estate was irrevocably designated as beneficiary of the life
insurance. Included
Not
Benefits received from SSS, beneficiary was irrevocably designated as beneficiary. Included
Not
Benefits from GSIS, beneficiary was revocably designated as beneficiary. Included
Proceeds of life insurance, the estate was designated as beneficiary of it. Included
Not
Proceeds of life insurance from group insurance. Included
Determine which proceeds of life insurance will be included in the gross estate  
Proceeds of life insurance, daughter of the insured was irrevocably designated as the beneficiary of the Not
life insurance. Included
Proceeds of life insurance, wife of the insured was revocably designated as the beneficiary of the life
insurance. Included
Proceeds of life insurance, the beneficiary’s designation was not stated in the insurance policy. Included
Proceeds of life insurance, the administrator of the estate was revocably designated as beneficiary of the
life insurance. Included
Proceeds of life insurance, the executor of the estate was irrevocably designated as beneficiary of the life
insurance. Included
Not
Benefits received from SSS, beneficiary was irrevocably designated as beneficiary. Included
Not
Benefits from GSIS, beneficiary was revocably designated as beneficiary. Included
Proceeds of life insurance, the estate was designated as beneficiary of it. Included
Not
Proceeds of life insurance from group insurance. Included
Claims against insolvent persons
• are claims of the deceased against insolvent persons.
• 1) The full amount of the claim is included in the gross estate.
• 2) The uncollectible amount of the claim is deducted from the gross
estate.
Claims against insolvent persons
• are claims of the deceased against insolvent persons.
• 1) The full amount of the claim is included in the gross estate.
• 2) The uncollectible amount of the claim is deducted from the gross
estate.
Amount received by heirs under R.A. No.
4917
• - any amount received by the heirs from the decedent’s employer as a
consequence of the death of the decedent-employee in accordance
with Republic Act No. 4917.
• 1) The amount received is included in the gross estate of the decedent.
• 2) The amount is also allowed as deduction from the gross estate

• R.A. No. 4917 is entitled ‘An Act providing that retirement benefits of
employees of private firms shall not be subject to attachment, levy,
execution, or any tax whatsoever’.
Amount received by heirs under R.A. No.
4917
• - any amount received by the heirs from the decedent’s employer as a
consequence of the death of the decedent-employee in accordance
with Republic Act No. 4917.
• 1) The amount received is included in the gross estate of the decedent.
• 2) The amount is also allowed as deduction from the gross estate

• R.A. No. 4917 is entitled ‘An Act providing that retirement benefits of
employees of private firms shall not be subject to attachment, levy,
execution, or any tax whatsoever’.
Prior interest/Decedent’s interest
• Refers to the value of any interest in property or rights accrued in favor of the
decedent on or before his death which have been received only after his death. (Sec.
85 (A) NIRC)
• As a rule, the interest must exist at the time of the decedent’s death to be included as
part of the gross estate.
• Examples
• 1. Dividends declared on or before the death of the stockholder, and received by the
estate after said stockholder’s death.
• 2. Partnership’s profit earned prior to death of the partner, received by the estate after
the partner’s death.
• 3. Accrued interest and rents on or before the time of death, but collection was made
after death.
Prior interest/Decedent’s interest
• Refers to the value of any interest in property or rights accrued in favor of the
decedent on or before his death which have been received only after his death. (Sec.
85 (A) NIRC)
• As a rule, the interest must exist at the time of the decedent’s death to be included as
part of the gross estate.
• Examples
• 1. Dividends declared on or before the death of the stockholder, and received by the
estate after said stockholder’s death.
• 2. Partnership’s profit earned prior to death of the partner, received by the estate after
the partner’s death.
• 3. Accrued interest and rents on or before the time of death, but collection was made
after death.
Family Home
• The family home refers to the dwelling house, including the land on
which it is situated, where the husband and the wife, or an unmarried
person who is the head of the family and members of the family
reside, as certified by the Barangay Captain of the locality.
Family Home
• The family home refers to the dwelling house, including the land on
which it is situated, where the husband and the wife, or an unmarried
person who is the head of the family and members of the family
reside, as certified by the Barangay Captain of the locality.
Family Home (Part ng Gross Estate)
• The family home refers to the dwelling house, including the land on
which it is situated, where the husband and the wife, or an unmarried
person who is the head of the family and members of the family
reside, as certified by the Barangay Captain of the locality.
Family Home (Part ng Gross Estate)
• The family home refers to the dwelling house, including the land on
which it is situated, where the husband and the wife, or an unmarried
person who is the head of the family and members of the family
reside, as certified by the Barangay Captain of the locality.
• Head of the family A head of a family is a single individual who
actually supports and maintains in one household one or more
individuals, and whose right to exercise family control and provide for
these dependent individuals is based upon some moral or legal
obligation.(Sec. 11, Rev. Reg. 2-40)
The following are the dependents of a head of
a family:
• a. one or both parents;
• b. one or more brothers or sisters;
• c. one or more legitimate, recognized natural, or adopted child;
• d. senior citizen;
• (The Train Law does not include illegitimate child, foster child and
person with disability as dependents of a head of the family)
A dependent legitimate, recognized natural
and legally adopted child is a:
• 1. a child who is chiefly dependent upon the taxpayer,
• 2. a child who is living with the taxpayer,
• 3. a child who is not more than twenty-one (21) years of age, or,
regardless of age, if such dependent is incapable of self-support
because of mental or physical defect.
• 4. unmarried child and
• 5. a child who is not gainfully employed.
A dependent brother/ sister is a:

• 1. a brother/ sister who is chiefly dependent upon the taxpayer,

• 2. a brother/ sister who is living with the taxpayer,
• 3. a brother/ sister who is not more than twenty-one (21) years of age, or,
regardless of age, if such dependent is incapable of self-support because of
mental or physical defect.
• 4. unmarried brother/ sister and
• 5. a brother/ sister who is not gainfully employed.
• A dependent parent/senior citizen is:
• 1. chiefly dependent upon the taxpayer,
• 2. living with the taxpayer,
Dependents

Mother or Father Senior Citizen Brother or Sister Child

Dependents

Mother or Father Senior Citizen Brother or Sister Child

Must Be living with the Tax payer

Dependents

Mother or Father Senior Citizen Brother or Sister Child

Must Be living with the Tax payer

Must not Be dependent for chief Support or more than 50% of Needs
Dependents

Mother or Father Senior Citizen Brother or Sister Child

Must Be living with the Tax payer

Must not Be dependent for chief Support or more than 50% of Needs

Must Not Be gainfully emplyed

Dependents

Mother or Father Senior Citizen Brother or Sister Child

Must Be living with the Tax payer

Must not Be dependent for chief Support or more than 50% of Needs

Must Not Be gainfully emplyed

Must Not Be married

Dependents

Mother or Father Senior Citizen Brother or Sister Child

Must Be living with the Tax payer

Must not Be dependent for chief Support or more than 50% of Needs

Must Not Be gainfully emplyed

Must Not Be married

Must Not Be over 21 unless budoy

Status of the Decedent
Status of the Decedent

Single Married
Status of the Decedent

Single Married

Always Exclusive May be Exclusive Or Common

Status of the Decedent

Single Married

Always Exclusive May be Exclusive Or Common

Included in the Gross Included in the Gross Included in the Gross

Estate Estate Estate
Status of the Decedent

Single Married

Always Exclusive May be Exclusive Or Common

Included in the Gross Included in the Gross Included in the Gross

Estate Estate Estate

Allowed Deduction is the

Share of the surviving
Spouse
Common types of property regimes:
Common types of property regimes:
Absolute separation of Conjugal partnership of Absolute community of
property (ASP) gains (CPG) property (ACP)
Common types of property regimes:
Absolute separation of Conjugal partnership of Absolute community of
property (ASP) gains (CPG) property (ACP)

- All present properties

- All properties that owned by the spouses at
accrues as fruit of their the date of celebration
- All properties of the of the marriage shall
individual or joint labor
spouses are separate become common
and fruits of their
properties, except those properties of the
properties during the
properties which they spouses including future
marriage will be
may acquire jointly.` fruit of their separate or
common properties of
the spouses. joint industry or fruits of
their common
properties.
Common types of property regimes:
Absolute separation of Conjugal partnership of Absolute community of
property (ASP) gains (CPG) property (ACP)

- All present properties

- All properties that owned by the spouses at
accrues as fruit of their the date of celebration
- All properties of the of the marriage shall
individual or joint labor
spouses are separate become common
and fruits of their
properties, except those properties of the
properties during the
properties which they spouses including future
marriage will be
may acquire jointly.` fruit of their separate or
common properties of
the spouses. joint industry or fruits of
their common
properties.

On or after August 3,
Before August 3, 1988
1988
Conjugal partnership of Absolute community of
gains (CPG) property (ACP)
Conjugal partnership of
gains (CPG)

Exclusive Properties Conjugal Properties

 Conjugal partnership of
gains (CPG)

Exclusive Properties Conjugal Properties

Properties brought into the marriage as either of the

spouse’s own.
Properties acquired by gratuitous (or lucrative) title
during marriage
Properties acquired by right of redemption or by
exchange with other property belonging to only one
of the spouses.

Properties acquired with the exclusive money of

either spouse.
 Conjugal Partnership of Gains
Acquired Single Date of Marriage Married  
Onerously Exclusive Exclusive Exclusive if money used is exclusive Conjugal if use as common fund
         
         
Gratuitously Exclusive Exclusive Exclusive  
         
         
Income        
Active Income       Conjugal
Passive Income       Conjugal
 Conjugal partnership of
gains (CPG)
Exclusive Properties
Properties brought into the marriage as either of the
spouse’s own.
Properties acquired by gratuitous (or lucrative) title
during marriage
Properties acquired by right of redemption or by
exchange with other property belonging to only one
of the spouses.
Properties acquired with the exclusive money of
either spouse.
Conjugal Properties
Properties obtained from labor, industry, work or profession of
either or both of the spouses.
Properties acquired by onerous title during the marriage at the
expense of the common fund, whether the acquisition is for the
partnership or for only one of the spouses
The fruits, natural, industrial or civil, due or received during the
marriage from the common property, as well as the net fruits from
the exclusive property of each spouse.
The share of either spouse in the hidden treasure which the law
awards to the finder or owner of the property where the treasure is
found.
Properties acquired through occupation such as fishing and
hunting.
Livestock existing upon the dissolution of the partnership in excess
of the number of each kind brought to the marriage by either
spouse.
Properties acquired by chance, such as winnings from gambling and
betting.
 Conjugal Partnership of Gains
Acquired Single Date of Marriage Married  
Onerously Exclusive Exclusive Exclusive if money used is exclusive Conjugal if use as common fund
         
         
Gratuitously Exclusive Exclusive Exclusive  
         
         
Income        
Active Income       Conjugal
Passive Income       Conjugal
 Conjugal Partnership of Gains
Acquired Single Date of Marriage Married  
Onerously Exclusive Exclusive Exclusive if money used is exclusive Conjugal if use as common fund
         
         
Gratuitously Exclusive Exclusive Exclusive  
         
         
Income        
Active Income       Conjugal
Passive Income       Conjugal
 Absolute community of
property (ACP)

Exclusive Properties Communal Properties

 Absolute community of
property (ACP)

Exclusive Properties Communal Properties

Properties acquired during the marriage by gratuitous (or lucrative)

title by either spouse, and the fruits as well as the income thereof,
if any, unless it is specifically provided by the donor, testator or
grantor that they shall form part of the community.

Property for personal and exclusive use of either spouse, however,

jewelry shall form part of the community property.

Property acquired before the marriage by either spouse who has

legitimate descendants by a former marriage and the fruits as well
as the income, if any, of such property.
 Absolute Community of Property
Acquired Single Date of Marriage Married  
Onerously Exclusive Common Exclusive if money used is exclusive Communal if use as common fund
Exclusive if only used by one Spouse
      Even if money used is Common Fund   
         
Gratuitously Exclusive Common Exclusive  
         
         
Income        
Active Income       Common
Passive Income      Exclusive if source is Exclusive Common if Source is Common
 Absolute community of
property (ACP)

Exclusive Properties Communal Properties

Properties acquired during the marriage by gratuitous (or lucrative) All properties owned by spouses at the time of the
title by either spouse, and the fruits as well as the income thereof, celebration of marriage or acquired thereafter.
if any, unless it is specifically provided by the donor, testator or
grantor that they shall form part of the community.

Property for personal and exclusive use of either spouse, however,

jewelry shall form part of the community property.

Property acquired before the marriage by either spouse who has

legitimate descendants by a former marriage and the fruits as well
as the income, if any, of such property.
 Conjugal partnership of SIMILARITIES Absolute community of
gains (CPG) property (ACP)

Exclusive Properties Exclusive Properties

Properties acquired by gratuitous (or lucrative) title

Properties acquired during the marriage by gratuitous (or lucrative)
during marriage
title by either spouse, and the fruits as well as the income thereof,
if any, unless it is specifically provided by the donor, testator or
grantor that they shall form part of the community.

Conjugal Properties Communal Properties

Property acquired during the marriage (other than Property acquired during the marriage (other than
inheritance or donation) inheritance or donation)

Property acquired from labor, industry, work or Property acquired from labor, industry, work or
profession of spouses profession of spouses
Conjugal partnership of SIMILARITIES Absolute community of
gains (CPG) property (ACP)

Exclusive Properties Exclusive Properties

Conjugal Properties Communal Properties

 Conjugal partnership of SIMILARITIES Absolute community of
gains (CPG) property (ACP)

Exclusive Properties Exclusive Properties

Properties acquired by gratuitous (or lucrative) title

Properties acquired during the marriage by gratuitous (or lucrative)
during marriage
title by either spouse, and the fruits as well as the income thereof,
if any, unless it is specifically provided by the donor, testator or
grantor that they shall form part of the community.

Conjugal Properties Communal Properties

Property acquired during the marriage (other than Property acquired during the marriage (other than
inheritance or donation) inheritance or donation)

Property acquired from labor, industry, work or Property acquired from labor, industry, work or
profession of spouses profession of spouses
 Conjugal partnership of Differences Absolute community of
gains (CPG) property (ACP)

Exclusive Properties Exclusive Properties

Fruits or income due or derived during the marriage

Property before marriage or brought to the marriage coming from exclusive property

Conjugal Properties Communal Properties

Fruits or income due or derived during the marriage Property before marriage or brought to the marriage
coming from exclusive property
Mr. Toby Bito is married to Kanna Bito. On January 1, 2019, he died and left the following
properties:  

    Conjugal Partnership of Gains Absolute Community of Property

    Exclusive Conjugal Exclusive Communal

Cash owned by his wife before the marriage. ₱2,000,000.00     ₱2,000,000.00

Real property inherited by Mr. Bito during the marriage. ₱6,000,000.00 ₱6,000,000.00   ₱6,000,000.00  

Personal property received by his wife as gift before the marriage. ₱400,000.00     ₱400,000.00

Personal property received by Mr. Bito as gift before the marriage. ₱2,000,000.00 ₱2,000,000.00     ₱2,000,000.00

Property acquired by Mr. Bito using his cash owned before the marriage. ₱600,000.00 ₱600,000.00     ₱600,000.00

Clothes of Mr. Bito purchased with his wife’s exclusive money. ₱500,000.00   ₱500,000.00  

Jewelry purchased with the exclusive cash of the surviving spouse ₱1,000,000.00     ₱1,000,000.00

Jewelry inherited during the marriage by the surviving spouse. ₱1,000,000.00    

Jewelry inherited before the marriage by the surviving spouse. ₱1,000,000.00     ₱1,000,000.00

Unidentified property ₱1,200,000.00   ₱1,200,000.00   ₱1,200,000.00

Cash representing the income earned during the marriage from the exclusive property of Mr.
Bito. ₱2,000,000.00 ₱2,000,000.00 2000000
Cash representing the income earned during the marriage from the common property of the
spouses. ₱2,000,000.00   ₱2,000,000.00   ₱2,000,000.00

    ₱8,600,000.00 ₱5,200,000.00 ₱8,500,000.00 ₱10,200,000.00

Mr. Toby Bito is married to Kanna Bito. On January 1, 2019, he died and left the following
properties:  

    Conjugal Partnership of Gains Absolute Community of Property

    Exclusive Conjugal Exclusive Communal

Cash owned by his wife before the marriage. ₱2,000,000.00     ₱2,000,000.00

Real property inherited by Mr. Bito during the marriage. ₱6,000,000.00 ₱6,000,000.00   ₱6,000,000.00  

Personal property received by his wife as gift before the marriage. ₱400,000.00     ₱400,000.00

Personal property received by Mr. Bito as gift before the marriage. ₱2,000,000.00 ₱2,000,000.00     ₱2,000,000.00

Property acquired by Mr. Bito using his cash owned before the marriage. ₱600,000.00 ₱600,000.00     ₱600,000.00

Clothes of Mr. Bito purchased with his wife’s exclusive money. ₱500,000.00   ₱500,000.00  

Jewelry purchased with the exclusive cash of the surviving spouse ₱1,000,000.00     ₱1,000,000.00

Jewelry inherited during the marriage by the surviving spouse. ₱1,000,000.00    

Jewelry inherited before the marriage by the surviving spouse. ₱1,000,000.00     ₱1,000,000.00

Unidentified property ₱1,200,000.00   ₱1,200,000.00   ₱1,200,000.00

Cash representing the income earned during the marriage from the exclusive property of Mr.
Bito. ₱2,000,000.00 ₱2,000,000.00 2000000
Cash representing the income earned during the marriage from the common property of the
spouses. ₱2,000,000.00   ₱2,000,000.00   ₱2,000,000.00

    ₱8,600,000.00 ₱5,200,000.00 ₱8,500,000.00 ₱10,200,000.00

Mr. Toby Bito is married to Kanna Bito. On January 1, 2019, he died and left the following
properties:  

    Conjugal Partnership of Gains Absolute Community of Property

    Exclusive Conjugal Exclusive Communal

Cash owned by his wife before the marriage. ₱2,000,000.00     ₱2,000,000.00

Real property inherited by Mr. Bito during the marriage. ₱6,000,000.00 ₱6,000,000.00   ₱6,000,000.00  

Personal property received by his wife as gift before the marriage. ₱400,000.00     ₱400,000.00

Personal property received by Mr. Bito as gift before the marriage. ₱2,000,000.00 ₱2,000,000.00     ₱2,000,000.00

Property acquired by Mr. Bito using his cash owned before the marriage. ₱600,000.00 ₱600,000.00     ₱600,000.00

Clothes of Mr. Bito purchased with his wife’s exclusive money. ₱500,000.00   ₱500,000.00  

Jewelry purchased with the exclusive cash of the surviving spouse ₱1,000,000.00     ₱1,000,000.00

Jewelry inherited during the marriage by the surviving spouse. ₱1,000,000.00    

Jewelry inherited before the marriage by the surviving spouse. ₱1,000,000.00     ₱1,000,000.00

Unidentified property ₱1,200,000.00   ₱1,200,000.00   ₱1,200,000.00

Cash representing the income earned during the marriage from the exclusive property of Mr.
Bito. ₱2,000,000.00 ₱2,000,000.00 2000000
Cash representing the income earned during the marriage from the common property of the
spouses. ₱2,000,000.00   ₱2,000,000.00   ₱2,000,000.00

    ₱8,600,000.00 ₱5,200,000.00 ₱8,500,000.00 ₱10,200,000.00

Mr. Toby Bito is married to Kanna Bito. On January 1, 2019, he died and left the following
properties:  

    Conjugal Partnership of Gains Absolute Community of Property

    Exclusive Conjugal Exclusive Communal

Cash owned by his wife before the marriage. ₱2,000,000.00     ₱2,000,000.00

Real property inherited by Mr. Bito during the marriage. ₱6,000,000.00 ₱6,000,000.00   ₱6,000,000.00  

Personal property received by his wife as gift before the marriage. ₱400,000.00     ₱400,000.00

Personal property received by Mr. Bito as gift before the marriage. ₱2,000,000.00 ₱2,000,000.00     ₱2,000,000.00

Property acquired by Mr. Bito using his cash owned before the marriage. ₱600,000.00 ₱600,000.00     ₱600,000.00

Clothes of Mr. Bito purchased with his wife’s exclusive money. ₱500,000.00   ₱500,000.00  

Jewelry purchased with the exclusive cash of the surviving spouse ₱1,000,000.00     ₱1,000,000.00

Jewelry inherited during the marriage by the surviving spouse. ₱1,000,000.00    

Jewelry inherited before the marriage by the surviving spouse. ₱1,000,000.00     ₱1,000,000.00

Unidentified property ₱1,200,000.00   ₱1,200,000.00   ₱1,200,000.00

Cash representing the income earned during the marriage from the exclusive property of Mr.
Bito. ₱2,000,000.00 ₱2,000,000.00 2000000
Cash representing the income earned during the marriage from the common property of the
spouses. ₱2,000,000.00   ₱2,000,000.00   ₱2,000,000.00

    ₱8,600,000.00 ₱5,200,000.00 ₱8,500,000.00 ₱10,200,000.00

Mr. Toby Bito is married to Kanna Bito. On January 1, 2019, he died and left the following
properties:  

    Conjugal Partnership of Gains Absolute Community of Property

    Exclusive Conjugal Exclusive Communal

Cash owned by his wife before the marriage. ₱2,000,000.00     ₱2,000,000.00

Real property inherited by Mr. Bito during the marriage. ₱6,000,000.00 ₱6,000,000.00   ₱6,000,000.00  

Personal property received by his wife as gift before the marriage. ₱400,000.00     ₱400,000.00

Personal property received by Mr. Bito as gift before the marriage. ₱2,000,000.00 ₱2,000,000.00     ₱2,000,000.00

Property acquired by Mr. Bito using his cash owned before the marriage. ₱600,000.00 ₱600,000.00     ₱600,000.00

Clothes of Mr. Bito purchased with his wife’s exclusive money. ₱500,000.00   ₱500,000.00  

Jewelry purchased with the exclusive cash of the surviving spouse ₱1,000,000.00     ₱1,000,000.00

Jewelry inherited during the marriage by the surviving spouse. ₱1,000,000.00    

Jewelry inherited before the marriage by the surviving spouse. ₱1,000,000.00     ₱1,000,000.00

Unidentified property ₱1,200,000.00   ₱1,200,000.00   ₱1,200,000.00

Cash representing the income earned during the marriage from the exclusive property of Mr.
Bito. ₱2,000,000.00 ₱2,000,000.00 2000000
Cash representing the income earned during the marriage from the common property of the
spouses. ₱2,000,000.00   ₱2,000,000.00   ₱2,000,000.00

    ₱8,600,000.00 ₱5,200,000.00 ₱8,500,000.00 ₱10,200,000.00

Mr. Toby Bito is married to Kanna Bito. On January 1, 2019, he died and left the following
properties:  

    Conjugal Partnership of Gains Absolute Community of Property

    Exclusive Conjugal Exclusive Communal

Cash owned by his wife before the marriage. ₱2,000,000.00     ₱2,000,000.00

Real property inherited by Mr. Bito during the marriage. ₱6,000,000.00 ₱6,000,000.00   ₱6,000,000.00  

Personal property received by his wife as gift before the marriage. ₱400,000.00     ₱400,000.00

Personal property received by Mr. Bito as gift before the marriage. ₱2,000,000.00 ₱2,000,000.00     ₱2,000,000.00

Property acquired by Mr. Bito using his cash owned before the marriage. ₱600,000.00 ₱600,000.00     ₱600,000.00

Clothes of Mr. Bito purchased with his wife’s exclusive money. ₱500,000.00   ₱500,000.00  

Jewelry purchased with the exclusive cash of the surviving spouse ₱1,000,000.00     ₱1,000,000.00

Jewelry inherited during the marriage by the surviving spouse. ₱1,000,000.00    

Jewelry inherited before the marriage by the surviving spouse. ₱1,000,000.00     ₱1,000,000.00

Unidentified property ₱1,200,000.00   ₱1,200,000.00   ₱1,200,000.00

Cash representing the income earned during the marriage from the exclusive property of Mr.
Bito. ₱2,000,000.00 ₱2,000,000.00 2000000
Cash representing the income earned during the marriage from the common property of the
spouses. ₱2,000,000.00   ₱2,000,000.00   ₱2,000,000.00

    ₱8,600,000.00 ₱5,200,000.00 ₱8,500,000.00 ₱10,200,000.00

Mr. Toby Bito is married to Kanna Bito. On January 1, 2019, he died and left the following
properties:  

    Conjugal Partnership of Gains Absolute Community of Property

    Exclusive Conjugal Exclusive Communal

Cash owned by his wife before the marriage. ₱2,000,000.00     ₱2,000,000.00

Real property inherited by Mr. Bito during the marriage. ₱6,000,000.00 ₱6,000,000.00   ₱6,000,000.00  

Personal property received by his wife as gift before the marriage. ₱400,000.00     ₱400,000.00

Personal property received by Mr. Bito as gift before the marriage. ₱2,000,000.00 ₱2,000,000.00     ₱2,000,000.00

Property acquired by Mr. Bito using his cash owned before the marriage. ₱600,000.00 ₱600,000.00     ₱600,000.00

Clothes of Mr. Bito purchased with his wife’s exclusive money. ₱500,000.00   ₱500,000.00  

Jewelry purchased with the exclusive cash of the surviving spouse ₱1,000,000.00     ₱1,000,000.00

Jewelry inherited during the marriage by the surviving spouse. ₱1,000,000.00    

Jewelry inherited before the marriage by the surviving spouse. ₱1,000,000.00     ₱1,000,000.00

Unidentified property ₱1,200,000.00   ₱1,200,000.00   ₱1,200,000.00

Cash representing the income earned during the marriage from the exclusive property of Mr.
Bito. ₱2,000,000.00 ₱2,000,000.00 2000000
Cash representing the income earned during the marriage from the common property of the
spouses. ₱2,000,000.00   ₱2,000,000.00   ₱2,000,000.00

    ₱8,600,000.00 ₱5,200,000.00 ₱8,500,000.00 ₱10,200,000.00

Mr. Toby Bito is married to Kanna Bito. On January 1, 2019, he died and left the following
properties:  

    Conjugal Partnership of Gains Absolute Community of Property

    Exclusive Conjugal Exclusive Communal

Cash owned by his wife before the marriage. ₱2,000,000.00     ₱2,000,000.00

Real property inherited by Mr. Bito during the marriage. ₱6,000,000.00 ₱6,000,000.00   ₱6,000,000.00  

Personal property received by his wife as gift before the marriage. ₱400,000.00     ₱400,000.00

Personal property received by Mr. Bito as gift before the marriage. ₱2,000,000.00 ₱2,000,000.00     ₱2,000,000.00

Property acquired by Mr. Bito using his cash owned before the marriage. ₱600,000.00 ₱600,000.00     ₱600,000.00

Clothes of Mr. Bito purchased with his wife’s exclusive money. ₱500,000.00   ₱500,000.00  

Jewelry purchased with the exclusive cash of the surviving spouse ₱1,000,000.00     ₱1,000,000.00

Jewelry inherited during the marriage by the surviving spouse. ₱1,000,000.00    

Jewelry inherited before the marriage by the surviving spouse. ₱1,000,000.00     ₱1,000,000.00

Unidentified property ₱1,200,000.00   ₱1,200,000.00   ₱1,200,000.00

Cash representing the income earned during the marriage from the exclusive property of Mr.
Bito. ₱2,000,000.00 ₱2,000,000.00 2000000
Cash representing the income earned during the marriage from the common property of the
spouses. ₱2,000,000.00   ₱2,000,000.00   ₱2,000,000.00

    ₱8,600,000.00 ₱5,200,000.00 ₱8,500,000.00 ₱10,200,000.00

Mr. Toby Bito is married to Kanna Bito. On January 1, 2019, he died and left the following
properties:  

    Conjugal Partnership of Gains Absolute Community of Property

    Exclusive Conjugal Exclusive Communal

Cash owned by his wife before the marriage. ₱2,000,000.00     ₱2,000,000.00

Real property inherited by Mr. Bito during the marriage. ₱6,000,000.00 ₱6,000,000.00   ₱6,000,000.00  

Personal property received by his wife as gift before the marriage. ₱400,000.00     ₱400,000.00

Personal property received by Mr. Bito as gift before the marriage. ₱2,000,000.00 ₱2,000,000.00     ₱2,000,000.00

Property acquired by Mr. Bito using his cash owned before the marriage. ₱600,000.00 ₱600,000.00     ₱600,000.00

Clothes of Mr. Bito purchased with his wife’s exclusive money. ₱500,000.00   ₱500,000.00  

Jewelry purchased with the exclusive cash of the surviving spouse ₱1,000,000.00     ₱1,000,000.00

Jewelry inherited during the marriage by the surviving spouse. ₱1,000,000.00    

Jewelry inherited before the marriage by the surviving spouse. ₱1,000,000.00     ₱1,000,000.00

Unidentified property ₱1,200,000.00   ₱1,200,000.00   ₱1,200,000.00

Cash representing the income earned during the marriage from the exclusive property of Mr.
Bito. ₱2,000,000.00 ₱2,000,000.00 2000000
Cash representing the income earned during the marriage from the common property of the
spouses. ₱2,000,000.00   ₱2,000,000.00   ₱2,000,000.00

    ₱8,600,000.00 ₱5,200,000.00 ₱8,500,000.00 ₱10,200,000.00

Mr. Toby Bito is married to Kanna Bito. On January 1, 2019, he died and left the following
properties:  

    Conjugal Partnership of Gains Absolute Community of Property

    Exclusive Conjugal Exclusive Communal

Cash owned by his wife before the marriage. ₱2,000,000.00     ₱2,000,000.00

Real property inherited by Mr. Bito during the marriage. ₱6,000,000.00 ₱6,000,000.00   ₱6,000,000.00  

Personal property received by his wife as gift before the marriage. ₱400,000.00     ₱400,000.00

Personal property received by Mr. Bito as gift before the marriage. ₱2,000,000.00 ₱2,000,000.00     ₱2,000,000.00

Property acquired by Mr. Bito using his cash owned before the marriage. ₱600,000.00 ₱600,000.00     ₱600,000.00

Clothes of Mr. Bito purchased with his wife’s exclusive money. ₱500,000.00   ₱500,000.00  

Jewelry purchased with the exclusive cash of the surviving spouse ₱1,000,000.00     ₱1,000,000.00

Jewelry inherited during the marriage by the surviving spouse. ₱1,000,000.00    

Jewelry inherited before the marriage by the surviving spouse. ₱1,000,000.00     ₱1,000,000.00

Unidentified property ₱1,200,000.00   ₱1,200,000.00   ₱1,200,000.00

Cash representing the income earned during the marriage from the exclusive property of Mr.
Bito. ₱2,000,000.00 ₱2,000,000.00 2000000
Cash representing the income earned during the marriage from the common property of the
spouses. ₱2,000,000.00   ₱2,000,000.00   ₱2,000,000.00

    ₱8,600,000.00 ₱5,200,000.00 ₱8,500,000.00 ₱10,200,000.00

Mr. Toby Bito is married to Kanna Bito. On January 1, 2019, he died and left the following
properties:  

    Conjugal Partnership of Gains Absolute Community of Property

    Exclusive Conjugal Exclusive Communal

Cash owned by his wife before the marriage. ₱2,000,000.00     ₱2,000,000.00

Real property inherited by Mr. Bito during the marriage. ₱6,000,000.00 ₱6,000,000.00   ₱6,000,000.00  

Personal property received by his wife as gift before the marriage. ₱400,000.00     ₱400,000.00

Personal property received by Mr. Bito as gift before the marriage. ₱2,000,000.00 ₱2,000,000.00     ₱2,000,000.00

Property acquired by Mr. Bito using his cash owned before the marriage. ₱600,000.00 ₱600,000.00     ₱600,000.00

Clothes of Mr. Bito purchased with his wife’s exclusive money. ₱500,000.00   ₱500,000.00  

Jewelry purchased with the exclusive cash of the surviving spouse ₱1,000,000.00     ₱1,000,000.00

Jewelry inherited during the marriage by the surviving spouse. ₱1,000,000.00    

Jewelry inherited before the marriage by the surviving spouse. ₱1,000,000.00     ₱1,000,000.00

Unidentified property ₱1,200,000.00   ₱1,200,000.00   ₱1,200,000.00

Cash representing the income earned during the marriage from the exclusive property of Mr.
Bito. ₱2,000,000.00 ₱2,000,000.00 2000000
Cash representing the income earned during the marriage from the common property of the
spouses. ₱2,000,000.00   ₱2,000,000.00   ₱2,000,000.00

    ₱8,600,000.00 ₱5,200,000.00 ₱8,500,000.00 ₱10,200,000.00

Mr. Toby Bito is married to Kanna Bito. On January 1, 2019, he died and left the following
properties:  

    Conjugal Partnership of Gains Absolute Community of Property

    Exclusive Conjugal Exclusive Communal

Cash owned by his wife before the marriage. ₱2,000,000.00     ₱2,000,000.00

Real property inherited by Mr. Bito during the marriage. ₱6,000,000.00 ₱6,000,000.00   ₱6,000,000.00  

Personal property received by his wife as gift before the marriage. ₱400,000.00     ₱400,000.00

Personal property received by Mr. Bito as gift before the marriage. ₱2,000,000.00 ₱2,000,000.00     ₱2,000,000.00

Property acquired by Mr. Bito using his cash owned before the marriage. ₱600,000.00 ₱600,000.00     ₱600,000.00

Clothes of Mr. Bito purchased with his wife’s exclusive money. ₱500,000.00   ₱500,000.00  

Jewelry purchased with the exclusive cash of the surviving spouse ₱1,000,000.00     ₱1,000,000.00

Jewelry inherited during the marriage by the surviving spouse. ₱1,000,000.00    

Jewelry inherited before the marriage by the surviving spouse. ₱1,000,000.00     ₱1,000,000.00

Unidentified property ₱1,200,000.00   ₱1,200,000.00   ₱1,200,000.00

Cash representing the income earned during the marriage from the exclusive property of Mr.
Bito. ₱2,000,000.00 ₱2,000,000.00 2,000,000.00
Cash representing the income earned during the marriage from the common property of the
spouses. ₱2,000,000.00   ₱2,000,000.00   ₱2,000,000.00

    ₱8,600,000.00 ₱5,200,000.00 ₱8,500,000.00 ₱10,200,000.00

Mr. Toby Bito is married to Kanna Bito. On January 1, 2019, he died and left the following
properties:  

    Conjugal Partnership of Gains Absolute Community of Property

    Exclusive Conjugal Exclusive Communal

Cash owned by his wife before the marriage. ₱2,000,000.00     ₱2,000,000.00

Real property inherited by Mr. Bito during the marriage. ₱6,000,000.00 ₱6,000,000.00   ₱6,000,000.00  

Personal property received by his wife as gift before the marriage. ₱400,000.00     ₱400,000.00

Personal property received by Mr. Bito as gift before the marriage. ₱2,000,000.00 ₱2,000,000.00     ₱2,000,000.00

Property acquired by Mr. Bito using his cash owned before the marriage. ₱600,000.00 ₱600,000.00     ₱600,000.00

Clothes of Mr. Bito purchased with his wife’s exclusive money. ₱500,000.00   ₱500,000.00  

Jewelry purchased with the exclusive cash of the surviving spouse ₱1,000,000.00     ₱1,000,000.00

Jewelry inherited during the marriage by the surviving spouse. ₱1,000,000.00    

Jewelry inherited before the marriage by the surviving spouse. ₱1,000,000.00     ₱1,000,000.00

Unidentified property ₱1,200,000.00   ₱1,200,000.00   ₱1,200,000.00

Cash representing the income earned during the marriage from the exclusive property of Mr.
Bito. ₱2,000,000.00 ₱2,000,000.00 2,000,000.00
Cash representing the income earned during the marriage from the common property of the
spouses. ₱2,000,000.00   ₱2,000,000.00   ₱2,000,000.00

    ₱8,600,000.00 ₱5,200,000.00 ₱8,500,000.00 ₱10,200,000.00

Mr. Toby Bito is married to Kanna Bito. On January 1, 2019, he died and left the following
properties:  

    Conjugal Partnership of Gains Absolute Community of Property

    Exclusive Conjugal Exclusive Communal

Cash owned by his wife before the marriage. ₱2,000,000.00     ₱2,000,000.00

Real property inherited by Mr. Bito during the marriage. ₱6,000,000.00 ₱6,000,000.00   ₱6,000,000.00  

Personal property received by his wife as gift before the marriage. ₱400,000.00     ₱400,000.00

Personal property received by Mr. Bito as gift before the marriage. ₱2,000,000.00 ₱2,000,000.00     ₱2,000,000.00

Property acquired by Mr. Bito using his cash owned before the marriage. ₱600,000.00 ₱600,000.00     ₱600,000.00

Clothes of Mr. Bito purchased with his wife’s exclusive money. ₱500,000.00   ₱500,000.00  

Jewelry purchased with the exclusive cash of the surviving spouse ₱1,000,000.00     ₱1,000,000.00

Jewelry inherited during the marriage by the surviving spouse. ₱1,000,000.00    

Jewelry inherited before the marriage by the surviving spouse. ₱1,000,000.00     ₱1,000,000.00

Unidentified property ₱1,200,000.00   ₱1,200,000.00   ₱1,200,000.00

Cash representing the income earned during the marriage from the exclusive property of Mr.
Bito. ₱2,000,000.00 ₱2,000,000.00 2,000,000.00
Cash representing the income earned during the marriage from the common property of the
spouses. ₱2,000,000.00   ₱2,000,000.00   ₱2,000,000.00

    ₱8,600,000.00 ₱5,200,000.00 ₱8,500,000.00 ₱10,200,000.00

 Gross Estate

Less Deductions

Taxable Net Estate

 Classification

Completeness
Gross Estate
Status

Less Deductions

Taxable Net Estate

 Classification Real Properties
Completeness Family Home
Gross Estate
Status Personal Properties

Business Interest

Taxable Transfers

Less Deductions

Taxable Net Estate

 Classification Real Properties
Completeness Family Home
Gross Estate
Status Personal Properties

Business Interest

Taxable Transfers

Exempted
Less Deductions
Exclusions

Taxable Net Estate

EXCLUSIONS AND EXEMPTIONS FROM
THE GROSS ESTATE
• Exemptions
• a. The merger of the usufruct in the owner of the naked title.
• b. The transmission or delivery of the inheritance or legacy of the fiduciary
heir or legatee to the fideicommissary.
• c. The transmission from the first heir, legatee, or donee in favor of another
beneficiary, in accordance with the desire of the predecessor.
• d. All bequest, devices, legacies or transfer to social welfare, cultural and
charitable institutions, no part of the net income of which inures to the
benefit of any individual and provided, however, that not more than 30% of
said bequest, devises, legacies or transfer shall be used by such institutions
for administrative purposes.
The merger of the usufruct in the owner of
the naked title
The merger of the usufruct in the owner of
the naked title

Son 1

Father

Son 2
The merger of the usufruct in the owner of
the naked title

Son 1

Father

Son 2
The merger of the usufruct in the owner of
the naked title

Son 1

Father

Son 2
The merger of the usufruct in the owner of
the naked title

Son 1

Father

Son 2

Transferred to Son 2 but is requested that

the fruits of the property be given to son
1 until he died
The merger of the usufruct in the owner of
the naked title

Son 1

Father died

Son 2

Transferred to Son 2 and is added to the

estate of the father because taxable
transfer
The merger of the usufruct in the owner of
the naked title

Son 1 Died

Father died

Son 2

The Usufruct is merged with the owner of

the Naked title
The transmission or delivery of the inheritance or legacy of
the fiduciary heir or legatee to the fideicommissary.
The transmission or delivery of the inheritance or legacy of
the fiduciary heir or legatee to the fideicommissary.

Grand Father Grand Son

The transmission or delivery of the inheritance or legacy of
the fiduciary heir or legatee to the fideicommissary.

Grand Father Grand Son

The transmission or delivery of the inheritance or legacy of
the fiduciary heir or legatee to the fideicommissary.

Grand Father Grand Son

Grand Son is not of

mature age to
receive the car
The transmission or delivery of the inheritance or legacy of
the fiduciary heir or legatee to the fideicommissary.

Grand Father Grand Son

Father
Grand Son is not of
mature age to
receive the car
The transmission or delivery of the inheritance or legacy of
the fiduciary heir or legatee to the fideicommissary.

Grand Father Died Grand Son

Father
Grand Son is not of
mature age to
receive the car
The transmission or delivery of the inheritance or legacy of
the fiduciary heir or legatee to the fideicommissary.

Grand Son
Grand Father Died
fideicommissary.

Father
fiduciary heir
Grand Son is not of
mature age to
receive the car
The transmission or delivery of the inheritance or legacy of
the fiduciary heir or legatee to the fideicommissary.

Grand Son
Grand Father Died
fideicommissary.

Father
fiduciary heir
Grand Son turned 18
The transmission or delivery of the inheritance or legacy of
the fiduciary heir or legatee to the fideicommissary.

Grand Son
Grand Father Died
fideicommissary.

Father
fiduciary heir
Grand Son turned 18
The transmission from the first heir, legatee, or donee in favor of
another beneficiary, in accordance with the desire of the
predecessor.

Son 1

Father

Son 2
The transmission from the first heir, legatee, or donee in favor of
another beneficiary, in accordance with the desire of the
predecessor.

Son 1

Father

Son 2
The transmission from the first heir, legatee, or donee in favor of
another beneficiary, in accordance with the desire of the
predecessor.

Son 1

Father gave the land

to son 1 but is to be
Father given to son 2 after 5
years

Son 2
The transmission from the first heir, legatee, or donee in favor of
another beneficiary, in accordance with the desire of the
predecessor.

Son 1

Father gave the land

to son 1 but is to be
Father Died given to son 2 after 5
years

Son 2
The transmission from the first heir, legatee, or donee in favor of
another beneficiary, in accordance with the desire of the
predecessor.

Son 1

Father gave the land

to son 1 but is to be
Father Died given to son 2 after 5
years

Son 2

Land Given to son 2 after 5 years

All bequest, devices, legacies or transfer to social welfare, cultural and charitable
institutions, no part of the net income of which inures to the benefit of any
individual and provided, however, that not more than 30% of said bequest, devises,
legacies or transfer shall be used by such institutions for administrative purposes.
All bequest, devices, legacies or transfer to social welfare, cultural and charitable
institutions, no part of the net income of which inures to the benefit of any
individual and provided, however, that not more than 30% of said bequest, devises,
legacies or transfer shall be used by such institutions for administrative purposes.

social welfare, cultural and charitable

institutions,
All bequest, devices, legacies or transfer to social welfare, cultural and charitable
institutions, no part of the net income of which inures to the benefit of any
individual and provided, however, that not more than 30% of said bequest, devises,
legacies or transfer shall be used by such institutions for administrative purposes.

social welfare, cultural and charitable

institutions,

Not for Profit

All bequest, devices, legacies or transfer to social welfare, cultural and charitable
institutions, no part of the net income of which inures to the benefit of any
individual and provided, however, that not more than 30% of said bequest, devises,
legacies or transfer shall be used by such institutions for administrative purposes.

social welfare, cultural and charitable

institutions,

Not for Profit

not more than 30% of said bequest, devises,

legacies or transfer shall be used by such
institutions for administrative purposes.
Exclusions
• a. Amounts received as war damages
• b. Amounts received from the United States Veterans Administration
• c. Benefits received from the GSIS
• d. Benefits received from the SSS
• e. Intangible personal property of a non-resident alien decedent under the
reciprocity clause
• f. Proceeds of life insurance under a group insurance taken by employer (not
taken out upon his life)
• g. Amounts withdrawn from the deposit accounts of a decedent subject to
the 6% final withholding tax imposed under section 97 of the NIRC
DETERMINATION OF THE VALUE OF
THE ESTATE
• 1. Right to Usufruct, Use or Habitation, Annuity There shall be taken
into account the probable life of the beneficiary in accordance with
the latest basic standard mortality table, to be approved by the
Secretary of Finance, upon the recommendation of the Insurance
Commissioner.
DETERMINATION OF THE VALUE OF
THE ESTATE
• 2. Property
• a. Generally, it is valued at its fair market value at the time of decedent’s death
• b. Real property is valued at the higher between the zonal value (BIR) vs. assessed value (Provincial and City
assessor)
• c. Personal properties – Recently purchase – Purchase price Not recently purchase – Pawn value x 3
• d. Securities (Shares of stock)
• 1. Shares of stock traded in the local stock exchange- Mean between the highest and lowest quotations on
valuation date or on a date nearest the valuation date.
• 2. Shares of stock not traded in the local stock exchange
• a) Common (ordinary) share – book value per share of issuing corporation.
• b) Preferred (preference) share – Par Value *In determining the book value of common shares appraisal
surplus shall not be considered as well as the value assigned to preferred shares if there are any.
• e. Units of participation in any association, recreation or amusement club (such as golf, polo, or similar clubs)
– the bid price nearest the date of death as published in any newspaper or publication of general circulation
 Classification Higher between asses
Real Properties and Zonal value
Completeness Family Home Recently purchase –
Gross Estate Purchase price Not
Status Personal Properties
recently purchase –
Business Interest Pawn value x 3

Taxable Transfers
between the highest
and lowest quotations
Exempted on valuation date or on
Less Deductions a date nearest the
Exclusions valuation date.

a) Common (ordinary)
share – book value per
Taxable Net Estate share of issuing
corporation. b)
Preferred (preference)
share – Par Value
 Resident
Mr. Ken Gee died and left the following properties: /Citizen NRA-No Reciprocity NRA-With Reciprocity
       
House and lot, USA, FMV, time of death P4,000,0000, cost, P2.000,000 ₱4,000,000.00 ₱0.00 ₱0.00
House and lot, Philippines, per BIR, time of death, P2,500,000; Value per tax declaration, time of
death, P2,000,000 ₱2,500,000.00 ₱2,500,000.00 ₱2,500,000.00
Furniture and appliances, Philippines, Pawn value time of death, P500,000 ₱1,500,000.00 ₱1,500,000.00 ₱1,500,000.00
Car, Japan, purchase price, P1,800,000 ₱1,800,000.00 ₱0.00 ₱0.00
Preference Shares, Philippines, sold for P300,000 1 day before death, FMV, date of sale, P250,000
Par value, date ₱0.00 ₱0.00 ₱0.00
of death, P350,000 (Reason of death, car accident).      
Bonds, issued by a Philippine Corporation, cost, P450,000; ₱450,000.00 ₱450,000.00 ₱0.00

Ordinary shares of stock, issued by a foreign corporation, 80% of the business is located in
the Philippines, par value, time of death, P500,000; book value, time of death, P600,000 ₱600,000.00 ₱0.00 ₱0.00
Proceeds of life insurance, Philippines (the estate is the designated beneficiary) , P1,800,000 ₱1,800,000.00 ₱1,800,000.00 ₱0.00
  ₱12,650,000.00 ₱6,250,000.00 ₱4,000,000.00
 Resident
Mr. Ken Gee died and left the following properties: /Citizen NRA-No Reciprocity NRA-With Reciprocity
       
House and lot, USA, FMV, time of death P4,000,0000, cost, P2.000,000 ₱4,000,000.00 ₱0.00 ₱0.00
House and lot, Philippines, per BIR, time of death, P2,500,000; Value per tax declaration, time of
death, P2,000,000 ₱2,500,000.00 ₱2,500,000.00 ₱2,500,000.00
Furniture and appliances, Philippines, Pawn value time of death, P500,000 ₱1,500,000.00 ₱1,500,000.00 ₱1,500,000.00
Car, Japan, purchase price, P1,800,000 ₱1,800,000.00 ₱0.00 ₱0.00
Preference Shares, Philippines, sold for P300,000 1 day before death, FMV, date of sale, P250,000
Par value, date ₱0.00 ₱0.00 ₱0.00
of death, P350,000 (Reason of death, car accident).      
Bonds, issued by a Philippine Corporation, cost, P450,000; ₱450,000.00 ₱450,000.00 ₱0.00

Ordinary shares of stock, issued by a foreign corporation, 80% of the business is located in
the Philippines, par value, time of death, P500,000; book value, time of death, P600,000 ₱600,000.00 ₱0.00 ₱0.00
Proceeds of life insurance, Philippines (the estate is the designated beneficiary) , P1,800,000 ₱1,800,000.00 ₱1,800,000.00 ₱0.00
  ₱12,650,000.00 ₱6,250,000.00 ₱4,000,000.00
 Resident
Mr. Ken Gee died and left the following properties: /Citizen NRA-No Reciprocity NRA-With Reciprocity
       
House and lot, USA, FMV, time of death P4,000,0000, cost, P2.000,000 ₱4,000,000.00 ₱0.00 ₱0.00
House and lot, Philippines, per BIR, time of death, P2,500,000; Value per tax declaration, time of
death, P2,000,000 ₱2,500,000.00 ₱2,500,000.00 ₱2,500,000.00
Furniture and appliances, Philippines, Pawn value time of death, P500,000 ₱1,500,000.00 ₱1,500,000.00 ₱1,500,000.00
Car, Japan, purchase price, P1,800,000 ₱1,800,000.00 ₱0.00 ₱0.00
Preference Shares, Philippines, sold for P300,000 1 day before death, FMV, date of sale, P250,000
Par value, date ₱0.00 ₱0.00 ₱0.00
of death, P350,000 (Reason of death, car accident).      
Bonds, issued by a Philippine Corporation, cost, P450,000; ₱450,000.00 ₱450,000.00 ₱0.00

Ordinary shares of stock, issued by a foreign corporation, 80% of the business is located in
the Philippines, par value, time of death, P500,000; book value, time of death, P600,000 ₱600,000.00 ₱0.00 ₱0.00
Proceeds of life insurance, Philippines (the estate is the designated beneficiary) , P1,800,000 ₱1,800,000.00 ₱1,800,000.00 ₱0.00
  ₱12,650,000.00 ₱6,250,000.00 ₱4,000,000.00
 Resident
Mr. Ken Gee died and left the following properties: /Citizen NRA-No Reciprocity NRA-With Reciprocity
       
House and lot, USA, FMV, time of death P4,000,0000, cost, P2.000,000 ₱4,000,000.00 ₱0.00 ₱0.00
House and lot, Philippines, per BIR, time of death, P2,500,000; Value per tax declaration, time of
death, P2,000,000 ₱2,500,000.00 ₱2,500,000.00 ₱2,500,000.00
Furniture and appliances, Philippines, Pawn value time of death, P500,000 ₱1,500,000.00 ₱1,500,000.00 ₱1,500,000.00
Car, Japan, purchase price, P1,800,000 ₱1,800,000.00 ₱0.00 ₱0.00
Preference Shares, Philippines, sold for P300,000 1 day before death, FMV, date of sale, P250,000
Par value, date ₱0.00 ₱0.00 ₱0.00
of death, P350,000 (Reason of death, car accident).      
Bonds, issued by a Philippine Corporation, cost, P450,000; ₱450,000.00 ₱450,000.00 ₱0.00

Ordinary shares of stock, issued by a foreign corporation, 80% of the business is located in
the Philippines, par value, time of death, P500,000; book value, time of death, P600,000 ₱600,000.00 ₱0.00 ₱0.00
Proceeds of life insurance, Philippines (the estate is the designated beneficiary) , P1,800,000 ₱1,800,000.00 ₱1,800,000.00 ₱0.00
  ₱12,650,000.00 ₱6,250,000.00 ₱4,000,000.00
 Resident
Mr. Ken Gee died and left the following properties: /Citizen NRA-No Reciprocity NRA-With Reciprocity
       
House and lot, USA, FMV, time of death P4,000,0000, cost, P2.000,000 ₱4,000,000.00 ₱0.00 ₱0.00
House and lot, Philippines, per BIR, time of death, P2,500,000; Value per tax declaration, time of
death, P2,000,000 ₱2,500,000.00 ₱2,500,000.00 ₱2,500,000.00
Furniture and appliances, Philippines, Pawn value time of death, P500,000 ₱1,500,000.00 ₱1,500,000.00 ₱1,500,000.00
Car, Japan, purchase price, P1,800,000 ₱1,800,000.00 ₱0.00 ₱0.00
Preference Shares, Philippines, sold for P300,000 1 day before death, FMV, date of sale, P250,000
Par value, date ₱0.00 ₱0.00 ₱0.00
of death, P350,000 (Reason of death, car accident).      
Bonds, issued by a Philippine Corporation, cost, P450,000; ₱450,000.00 ₱450,000.00 ₱0.00

Ordinary shares of stock, issued by a foreign corporation, 80% of the business is located in
the Philippines, par value, time of death, P500,000; book value, time of death, P600,000 ₱600,000.00 ₱0.00 ₱0.00
Proceeds of life insurance, Philippines (the estate is the designated beneficiary) , P1,800,000 ₱1,800,000.00 ₱1,800,000.00 ₱0.00
  ₱12,650,000.00 ₱6,250,000.00 ₱4,000,000.00
 Resident
Mr. Ken Gee died and left the following properties: /Citizen NRA-No Reciprocity NRA-With Reciprocity
       
House and lot, USA, FMV, time of death P4,000,0000, cost, P2.000,000 ₱4,000,000.00 ₱0.00 ₱0.00
House and lot, Philippines, per BIR, time of death, P2,500,000; Value per tax declaration, time of
death, P2,000,000 ₱2,500,000.00 ₱2,500,000.00 ₱2,500,000.00
Furniture and appliances, Philippines, Pawn value time of death, P500,000 ₱1,500,000.00 ₱1,500,000.00 ₱1,500,000.00
Car, Japan, purchase price, P1,800,000 ₱1,800,000.00 ₱0.00 ₱0.00
Preference Shares, Philippines, sold for P300,000 1 day before death, FMV, date of sale, P250,000
Par value, date ₱0.00 ₱0.00 ₱0.00
of death, P350,000 (Reason of death, car accident).      
Bonds, issued by a Philippine Corporation, cost, P450,000; ₱450,000.00 ₱450,000.00 ₱0.00

Ordinary shares of stock, issued by a foreign corporation, 80% of the business is located in
the Philippines, par value, time of death, P500,000; book value, time of death, P600,000 ₱600,000.00 ₱0.00 ₱0.00
Proceeds of life insurance, Philippines (the estate is the designated beneficiary) , P1,800,000 ₱1,800,000.00 ₱1,800,000.00 ₱0.00
  ₱12,650,000.00 ₱6,250,000.00 ₱4,000,000.00
 Resident
Mr. Ken Gee died and left the following properties: /Citizen NRA-No Reciprocity NRA-With Reciprocity
       
House and lot, USA, FMV, time of death P4,000,0000, cost, P2.000,000 ₱4,000,000.00 ₱0.00 ₱0.00
House and lot, Philippines, per BIR, time of death, P2,500,000; Value per tax declaration, time of
death, P2,000,000 ₱2,500,000.00 ₱2,500,000.00 ₱2,500,000.00
Furniture and appliances, Philippines, Pawn value time of death, P500,000 ₱1,500,000.00 ₱1,500,000.00 ₱1,500,000.00
Car, Japan, purchase price, P1,800,000 ₱1,800,000.00 ₱0.00 ₱0.00
Preference Shares, Philippines, sold for P300,000 1 day before death, FMV, date of sale, P250,000
Par value, date ₱0.00 ₱0.00 ₱0.00
of death, P350,000 (Reason of death, car accident).      
Bonds, issued by a Philippine Corporation, cost, P450,000; ₱450,000.00 ₱450,000.00 ₱0.00

Ordinary shares of stock, issued by a foreign corporation, 80% of the business is located in
the Philippines, par value, time of death, P500,000; book value, time of death, P600,000 ₱600,000.00 ₱0.00 ₱0.00
Proceeds of life insurance, Philippines (the estate is the designated beneficiary) , P1,800,000 ₱1,800,000.00 ₱1,800,000.00 ₱0.00
  ₱12,650,000.00 ₱6,250,000.00 ₱4,000,000.00
 Resident
Mr. Ken Gee died and left the following properties: /Citizen NRA-No Reciprocity NRA-With Reciprocity
       
House and lot, USA, FMV, time of death P4,000,0000, cost, P2.000,000 ₱4,000,000.00 ₱0.00 ₱0.00
House and lot, Philippines, per BIR, time of death, P2,500,000; Value per tax declaration, time of
death, P2,000,000 ₱2,500,000.00 ₱2,500,000.00 ₱2,500,000.00
Furniture and appliances, Philippines, Pawn value time of death, P500,000 ₱1,500,000.00 ₱1,500,000.00 ₱1,500,000.00
Car, Japan, purchase price, P1,800,000 ₱1,800,000.00 ₱0.00 ₱0.00
Preference Shares, Philippines, sold for P300,000 1 day before death, FMV, date of sale, P250,000
Par value, date ₱0.00 ₱0.00 ₱0.00
of death, P350,000 (Reason of death, car accident).      
Bonds, issued by a Philippine Corporation, cost, P450,000; ₱450,000.00 ₱450,000.00 ₱0.00

Ordinary shares of stock, issued by a foreign corporation, 80% of the business is located in
the Philippines, par value, time of death, P500,000; book value, time of death, P600,000 ₱600,000.00 ₱0.00 ₱0.00
Proceeds of life insurance, Philippines (the estate is the designated beneficiary) , P1,800,000 ₱1,800,000.00 ₱1,800,000.00 ₱0.00
  ₱12,650,000.00 ₱6,250,000.00 ₱4,000,000.00
 Resident
Mr. Ken Gee died and left the following properties: /Citizen NRA-No Reciprocity NRA-With Reciprocity
       
House and lot, USA, FMV, time of death P4,000,0000, cost, P2.000,000 ₱4,000,000.00 ₱0.00 ₱0.00
House and lot, Philippines, per BIR, time of death, P2,500,000; Value per tax declaration, time of
death, P2,000,000 ₱2,500,000.00 ₱2,500,000.00 ₱2,500,000.00
Furniture and appliances, Philippines, Pawn value time of death, P500,000 ₱1,500,000.00 ₱1,500,000.00 ₱1,500,000.00
Car, Japan, purchase price, P1,800,000 ₱1,800,000.00 ₱0.00 ₱0.00
Preference Shares, Philippines, sold for P300,000 1 day before death, FMV, date of sale, P250,000
Par value, date ₱0.00 ₱0.00 ₱0.00
of death, P350,000 (Reason of death, car accident).      
Bonds, issued by a Philippine Corporation, cost, P450,000; ₱450,000.00 ₱450,000.00 ₱0.00

Ordinary shares of stock, issued by a foreign corporation, 80% of the business is located in
the Philippines, par value, time of death, P500,000; book value, time of death, P600,000 ₱600,000.00 ₱0.00 ₱0.00
Proceeds of life insurance, Philippines (the estate is the designated beneficiary) , P1,800,000 ₱1,800,000.00 ₱1,800,000.00 ₱0.00
  ₱12,650,000.00 ₱6,250,000.00 ₱4,000,000.00
 Resident
Mr. Ken Gee died and left the following properties: /Citizen NRA-No Reciprocity NRA-With Reciprocity
       
House and lot, USA, FMV, time of death P4,000,0000, cost, P2.000,000 ₱4,000,000.00 ₱0.00 ₱0.00
House and lot, Philippines, per BIR, time of death, P2,500,000; Value per tax declaration, time of
death, P2,000,000 ₱2,500,000.00 ₱2,500,000.00 ₱2,500,000.00
Furniture and appliances, Philippines, Pawn value time of death, P500,000 ₱1,500,000.00 ₱1,500,000.00 ₱1,500,000.00
Car, Japan, purchase price, P1,800,000 ₱1,800,000.00 ₱0.00 ₱0.00
Preference Shares, Philippines, sold for P300,000 1 day before death, FMV, date of sale, P250,000
Par value, date ₱0.00 ₱0.00 ₱0.00
of death, P350,000 (Reason of death, car accident).      
Bonds, issued by a Philippine Corporation, cost, P450,000; ₱450,000.00 ₱450,000.00 ₱0.00

Ordinary shares of stock, issued by a foreign corporation, 80% of the business is located in
the Philippines, par value, time of death, P500,000; book value, time of death, P600,000 ₱600,000.00 ₱0.00 ₱0.00
Proceeds of life insurance, Philippines (the estate is the designated beneficiary) , P1,800,000 ₱1,800,000.00 ₱1,800,000.00 ₱0.00
  ₱12,650,000.00 ₱6,250,000.00 ₱4,000,000.00
 Classification Higher between asses
Real Properties and Zonal value
Completeness Family Home Recently purchase –
Gross Estate Purchase price Not
Status Personal Properties
recently purchase –
Business Interest Pawn value x 3

Taxable Transfers
between the highest
and lowest quotations
Ordinary Exempted on valuation date or on
Less Deductions a date nearest the
Special Exclusions valuation date.

a) Common (ordinary)
share – book value per
Taxable Net Estate share of issuing
corporation. b)
Preferred (preference)
share – Par Value
 Classification Higher between asses
Real Properties and Zonal value
Completeness Family Home Recently purchase –
Gross Estate Purchase price Not
Status Personal Properties
recently purchase –
Business Interest Pawn value x 3

Taxable Transfers
between the highest
and lowest quotations
Ordinary Exempted on valuation date or on
Less Deductions a date nearest the
Special Exclusions valuation date.

Losses, indebtedness,
taxes, etc. (LITE) a) Common (ordinary)
Transfer for public share – book value per
Taxable Net Estate purpose share of issuing
Property previously taxed corporation. b)
(Vanishing Deductions) Preferred (preference)
share – Par Value
 Classification
Real Properties
Completeness Family Home
Gross Estate
Status Personal Properties
Business Interest
Taxable Transfers
Ordinary Exempted
Less Deductions
Special Exclusions
Losses, indebtedness,
Family Home taxes, etc. (LITE)
Transfer for public
Taxable Net Estate Standard purpose
Property previously taxed
. Amount received (Vanishing Deductions)
under R.A. 4917
Higher between asses
and Zonal value
Recently purchase –
Purchase price Not
recently purchase –
Pawn value x 3
between the highest
and lowest quotations
on valuation date or on
a date nearest the
valuation date.
a) Common (ordinary)
share – book value per
share of issuing
corporation. b)
Preferred (preference)
share – Par Value
Losses
• a. It is incurred during the settlement of the estate.
• b. It arose from fire, storm, shipwreck, or other casualties, or from
robbery, theft, or embezzlement.
• c. It is not compensated for by insurance or otherwise.
• d. It must not have been claimed as deduction for income tax
purposes in an income tax return.
• e. It is incurred not later than the last day for the payment of the
estate tax
 Within 12 months

Losses from the time of

death

• a. It is incurred during the settlement of the estate.

• b. It arose from fire, storm, shipwreck, or other casualties, or from
robbery, theft, or embezzlement.
• c. It is not compensated for by insurance or otherwise.
• d. It must not have been claimed as deduction for income tax
purposes in an income tax return.
• e. It is incurred not later than the last day for the payment of the
estate tax
Property at the
time of death
Property at the
time of death
Property at the
time of death
• Provided
• c. It is not compensated for by
insurance or otherwise.
• d. It must not have been
claimed as deduction for
income tax purposes in an
income tax return.
• Not Including Loss on Sale
Indebtedness (Claims against the estate)
• a. The liability represents a personal obligation of the deceased existing at the time of his death
• b. The liability was contracted in good faith and for adequate and full consideration in money or money’s
worth
• c. The claim must be a debt or claim which is valid in law and enforceable in court
• d. The indebtedness must not have been condoned by the creditor or the action to collect from the decedent
must not have prescribed. Claims against the estate or indebtedness in respect of property may arise out of
the following sources:
• 1. Contract
• 2. Tort
• 3. Operation of law
• e. If the claim was based on a debt instrument, such instrument must be NOTARIZED. (Except loans granted by
financial institutions where notarization is not part of the business practice of the financial institution lender.)
• f. If a loan was incurred within 3 years before the decedent death, the administrator, or executor is required to
render a statement showing the disposition of the loan proceeds.
Indebtedness (Claims against the estate)
• a. The liability represents a personal obligation of the deceased existing at the time of his death
• b. The liability was contracted in good faith and for adequate and full consideration in money or money’s
worth
• c. The claim must be a debt or claim which is valid in law and enforceable in court
• d. The indebtedness must not have been condoned by the creditor or the action to collect from the decedent
must not have prescribed. Claims against the estate or indebtedness in respect of property may arise out of
the following sources:
• 1. Contract
• 2. Tort
• 3. Operation of law
• e. If the claim was based on a debt instrument, such instrument must be NOTARIZED. (Except loans granted by
financial institutions where notarization is not part of the business practice of the financial institution lender.)
• f. If a loan was incurred within 3 years before the decedent death, the administrator, or executor is required to
render a statement showing the disposition of the loan proceeds.
Indebtedness (Claims against the estate)
• a. The liability represents a personal obligation of the deceased existing at the time of his death
• b. The liability was contracted in good faith and for adequate and full consideration in money or money’s
worth
• c. The claim must be a debt or claim which is valid in law and enforceable in court
• d. The indebtedness must not have been condoned by the creditor or the action to collect from the decedent
must not have prescribed. Claims against the estate or indebtedness in respect of property may arise out of
the following sources:
• 1. Contract
• 2. Tort
• 3. Operation of law
• e. If the claim was based on a debt instrument, such instrument must be NOTARIZED. (Except loans granted by
financial institutions where notarization is not part of the business practice of the financial institution lender.)
• f. If a loan was incurred within 3 years before the decedent death, the administrator, or executor is required to
render a statement showing the disposition of the loan proceeds.
Unpaid taxes
• a. The tax must have accrued before the death of the decedent
• Unpaid taxes that accrued before the decedent’s death but not
including:
• a. Any income tax upon income received after the death of the
decedent, or
• b. Property taxes not accrued before his death, or
• c. Any estate tax
Unpaid taxes
• a. The tax must have accrued before the death of the decedent
• Unpaid taxes that accrued before the decedent’s death but not
including:
• a. Any income tax upon income received after the death of the
decedent, or
• b. Property taxes not accrued before his death, or
• c. Any estate tax
Claims against insolvent persons
• a. The value of the claims is included in the gross estate.
• b. The debtors are incapable of paying their debts.
Unpaid mortgage
• a. The fair market value of the mortgaged property undiminished by
such mortgage or indebtedness has been included as part of the gross
estate
• b. The mortgage indebtedness was contracted in good faith and for an
adequate and full consideration
Unpaid mortgage
• a. The fair market value of the mortgaged property undiminished by
such mortgage or indebtedness has been included as part of the gross
estate
• b. The mortgage indebtedness was contracted in good faith and for an
adequate and full consideration
Transfer for Public Use
• Amount of all bequests, legacies, devises or transfers to or for the use
of the Government of the Philippines, or any political subdivision for
exclusively public purpose.
• 1. The disposition must be a. testamentary in character (in the last will
and testament) or b. by way of donation mortis causa (should take
effect after death) c. executed by the decedent before his death.
• 2. In favor of the Government of the Philippines or any of its political
subdivisions.
• 3. Exclusive for public purpose.
• 4. The value of the property given is included in the gross estate.
Transfer for Public Use
• Amount of all bequests, legacies, devises or transfers to or for the use
of the Government of the Philippines, or any political subdivision for
exclusively public purpose.
• 1. The disposition must be a. testamentary in character (in the last will
and testament) or b. by way of donation mortis causa (should take
effect after death) c. executed by the decedent before his death.
• 2. In favor of the Government of the Philippines or any of its political
subdivisions.
• 3. Exclusive for public purpose.
• 4. The value of the property given is included in the gross estate.
Transfer for Public Use
• Amount of all bequests, legacies, devises or transfers to or for the use
of the Government of the Philippines, or any political subdivision for
exclusively public purpose.
• 1. The disposition must be a. testamentary in character (in the last will
and testament) or b. by way of donation mortis causa (should take
effect after death) c. executed by the decedent before his death.
• 2. In favor of the Government of the Philippines or any of its political
subdivisions.
• 3. Exclusive for public purpose.
• 4. The value of the propertyUnder
given
Trainis included
Law the propertyin the gross estate.
Donated
Must be Located in the PH to be allowed
as a deduction
Property Previously Tax (Vanishing
Deduction)
• This is a deduction derived from a property that was previously
subjected to transfer tax.
Property Previously Tax (Vanishing
Deduction)
Present Decedent
Prior Decedent
Property Previously Tax (Vanishing
Deduction) Transfer Tax has
been paid Present Decedent
Prior Decedent
Property Previously Tax (Vanishing
Deduction) Transfer Tax has
been paid Present Decedent
Prior Decedent
The present decedent must have died within five (5) years from the
receipt of the property from a prior decedent or donor.
Property Previously Tax (Vanishing
Deduction) Transfer Tax has
been paid Present Decedent
Prior Decedent
The present decedent must have died within five (5) years from the
receipt of the property from a prior decedent or donor.
The property involved must have been a property transferred by a
prior decedent or donor to the present decedent or the property
acquired in exchange for the original property so received.
Property Previously Tax (Vanishing
Deduction) Transfer Tax has
been paid Present Decedent
Prior Decedent
The present decedent must have died within five (5) years from the
receipt of the property from a prior decedent or donor.
The property involved must have been a property transferred by a
prior decedent or donor to the present decedent or the property
acquired in exchange for the original property so received.
The property must have formed part of the prior decedent’s gross
estate situated in the Philippines or been included in the total
amount of the gifts of the donor made within 5 years prior to the
present decedent’s death.
Property Previously Tax (Vanishing
Deduction) Transfer Tax has
been paid Present Decedent
Prior Decedent
The present decedent must have died within five (5) years from the
receipt of the property from a prior decedent or donor.
The property involved must have been a property transferred by a
prior decedent or donor to the present decedent or the property
acquired in exchange for the original property so received.
The property must have formed part of the prior decedent’s gross
estate situated in the Philippines or been included in the total
amount of the gifts of the donor made within 5 years prior to the
present decedent’s death.
The estate tax on the prior succession must have been finally
determined and paid by the prior decedent. The same applies to
gifts, in that donors must have taken care of the donor’s tax.
Property Previously Tax (Vanishing
Deduction) Transfer Tax has
been paid Present Decedent
Prior Decedent
The present decedent must have died within five (5) years from the
receipt of the property from a prior decedent or donor.
The property involved must have been a property transferred by a
prior decedent or donor to the present decedent or the property
acquired in exchange for the original property so received.
The property must have formed part of the prior decedent’s gross
estate situated in the Philippines or been included in the total
amount of the gifts of the donor made within 5 years prior to the
present decedent’s death.
The estate tax on the prior succession must have been finally
determined and paid by the prior decedent. The same applies to
gifts, in that donors must have taken care of the donor’s tax.

The vanishing deduction on the property must not have been

claimed by the previous estate involving the same property.
Ms. Vani Shing died unmarried and left a property she inherited from her father 3 ½ years ago. At the time of
her father’s death the property has a fair market value of P800,000 and an unpaid mortgage of P100,00. During
her death it has a fair market value of P750,000. P50,000 of the unpaid mortgage of the inherited property was
paid by her before she died. Her gross estate, other than her inherited property has a fair market value of
P1,350,000. The total losses, indebtedness, taxes, etc.(LITE) and transfer for public purpose amounted to
P300,000.
Ms. Vani Shing died unmarried and left a property she inherited from her father 3 ½ years ago. At the time of
her father’s death the property has a fair market value of P800,000 and an unpaid mortgage of P100,00. During
her death it has a fair market value of P750,000. P50,000 of the unpaid mortgage of the inherited property was
paid by her before she died. Her gross estate, other than her inherited property has a fair market value of
P1,350,000. The total losses, indebtedness, taxes, etc.(LITE) and transfer for public purpose amounted to
P300,000.

Present
Decedent
Ms. Vani Shing died unmarried and left a property she inherited from her father 3 ½ years ago. At the time of
her father’s death the property has a fair market value of P800,000 and an unpaid mortgage of P100,00. During
her death it has a fair market value of P750,000. P50,000 of the unpaid mortgage of the inherited property was
paid by her before she died. Her gross estate, other than her inherited property has a fair market value of
P1,350,000. The total losses, indebtedness, taxes, etc.(LITE) and transfer for public purpose amounted to
P300,000.

Present
Prior Decedent
Decedent
Ms. Vani Shing died unmarried and left a property she inherited from her father 3 ½ years ago. At the time of
her father’s death the property has a fair market value of P800,000 and an unpaid mortgage of P100,00. During
her death it has a fair market value of P750,000. P50,000 of the unpaid mortgage of the inherited property was
paid by her before she died. Her gross estate, other than her inherited property has a fair market value of
P1,350,000. The total losses, indebtedness, taxes, etc.(LITE) and transfer for public purpose amounted to
P300,000.

Present Property na
may transfer Prior Decedent
Decedent
tax na
 Ms. Vani Shing died unmarried and left a property she inherited from her father 3 ½ years ago. At the time of
her father’s death the property has a fair market value of P800,000 and an unpaid mortgage of P100,00. During
her death it has a fair market value of P750,000. P50,000 of the unpaid mortgage of the inherited property was
paid by her before she died. Her gross estate, other than her inherited property has a fair market value of
P1,350,000. The total losses, indebtedness, taxes, etc.(LITE) and transfer for public purpose amounted to
P300,000.
Rates of vanishing deduction – If the present decedent died within the following period
after the date of prior decedent’s death or after the date of donation:  
0 1 Year 100%
> 1 Year 2 Years 80%
> 2 Years 3 Year 60%
> 3 Years 4 Years 40%
> 4 Years 5 Years 20%
> 5 Years   0%

Format of Computation    
FMV of Inherited property at the time of death ₱750,000.00  
FMV of Gross estate other than Inherited property ₱1,350,000.00  
Total Gross Estate of the present Decedent ₱2,100,000.00  
LITE and property transferred for public used ₱300,000.00  
Value to take   ₱750,000.00
Less Mortgaged paid by the current decedent   -₱50,000.00
Initial basis   ₱700,000.00

Less: Proportional Deductions(LITE and property transferred for public used) (P700,000/ P2,100,0000) *
(Initial basis / Gross estate) x (LITE plus TPU) P300,000 -₱100,000.00
Final Basis   ₱600,000.00
Multiply by Rate of Vanishing Deduction   40%
Vanishing Deduction   ₱240,000.00
 Ms. Vani Shing died unmarried and left a property she inherited from her father 3 ½ years ago. At the time of
her father’s death the property has a fair market value of P800,000 and an unpaid mortgage of P100,00. During
her death it has a fair market value of P750,000. P50,000 of the unpaid mortgage of the inherited property was
paid by her before she died. Her gross estate, other than her inherited property has a fair market value of
P1,350,000. The total losses, indebtedness, taxes, etc.(LITE) and transfer for public purpose amounted to
P300,000.
Rates of vanishing deduction – If the present decedent died within the following period
after the date of prior decedent’s death or after the date of donation:  
0 1 Year 100%
> 1 Year 2 Years 80%
> 2 Years 3 Year 60%
> 3 Years 4 Years 40%
> 4 Years 5 Years 20%
> 5 Years   0%

Format of Computation    
FMV of Inherited property at the time of death ₱750,000.00  
FMV of Gross estate other than Inherited property ₱1,350,000.00  
Total Gross Estate of the present Decedent ₱2,100,000.00  
LITE and property transferred for public used ₱300,000.00  
Value to take   ₱750,000.00
Less Mortgaged paid by the current decedent   -₱50,000.00
Initial basis   ₱700,000.00

Less: Proportional Deductions(LITE and property transferred for public used) (P700,000/ P2,100,0000) *
(Initial basis / Gross estate) x (LITE plus TPU) P300,000 -₱100,000.00
Final Basis   ₱600,000.00
Multiply by Rate of Vanishing Deduction   40%
Vanishing Deduction   ₱240,000.00
 Ms. Vani Shing died unmarried and left a property she inherited from her father 3 ½ years ago. At the time of
her father’s death the property has a fair market value of P800,000 and an unpaid mortgage of P100,00. During
her death it has a fair market value of P750,000. P50,000 of the unpaid mortgage of the inherited property was
paid by her before she died. Her gross estate, other than her inherited property has a fair market value of
P1,350,000. The total losses, indebtedness, taxes, etc.(LITE) and transfer for public purpose amounted to
P300,000.
Rates of vanishing deduction – If the present decedent died within the following period
after the date of prior decedent’s death or after the date of donation:  
0 1 Year 100%
> 1 Year 2 Years 80%
> 2 Years 3 Year 60%
> 3 Years 4 Years 40%
> 4 Years 5 Years 20%
> 5 Years   0%

Format of Computation    
FMV of Inherited property at the time of death ₱750,000.00  
FMV of Gross estate other than Inherited property ₱1,350,000.00  
Total Gross Estate of the present Decedent ₱2,100,000.00  
LITE and property transferred for public used ₱300,000.00  
Value to take   ₱750,000.00
Less Mortgaged paid by the current decedent   -₱50,000.00
Initial basis   ₱700,000.00

Less: Proportional Deductions(LITE and property transferred for public used) (P700,000/ P2,100,0000) *
(Initial basis / Gross estate) x (LITE plus TPU) P300,000 -₱100,000.00
Final Basis   ₱600,000.00
Multiply by Rate of Vanishing Deduction   40%
Vanishing Deduction   ₱240,000.00
 Ms. Vani Shing died unmarried and left a property she inherited from her father 3 ½ years ago. At the time of
her father’s death the property has a fair market value of P800,000 and an unpaid mortgage of P100,00. During
her death it has a fair market value of P750,000. P50,000 of the unpaid mortgage of the inherited property was
paid by her before she died. Her gross estate, other than her inherited property has a fair market value of
P1,350,000. The total losses, indebtedness, taxes, etc.(LITE) and transfer for public purpose amounted to
P300,000.
Rates of vanishing deduction – If the present decedent died within the following period
after the date of prior decedent’s death or after the date of donation:  
0 1 Year 100%
> 1 Year 2 Years 80%
> 2 Years 3 Year 60%
> 3 Years 4 Years 40%
> 4 Years 5 Years 20%
> 5 Years   0%

Format of Computation    
FMV of Inherited property at the time of death ₱750,000.00  
FMV of Gross estate other than Inherited property ₱1,350,000.00  
Total Gross Estate of the present Decedent ₱2,100,000.00  
LITE and property transferred for public used ₱300,000.00  
Value to take   ₱750,000.00
Less Mortgaged paid by the current decedent   -₱50,000.00
Initial basis   ₱700,000.00

Less: Proportional Deductions(LITE and property transferred for public used) (P700,000/ P2,100,0000) *
(Initial basis / Gross estate) x (LITE plus TPU) P300,000 -₱100,000.00
Final Basis   ₱600,000.00
Multiply by Rate of Vanishing Deduction   40%
Vanishing Deduction   ₱240,000.00
 Ms. Vani Shing died unmarried and left a property she inherited from her father 3 ½ years ago. At the time of
her father’s death the property has a fair market value of P800,000 and an unpaid mortgage of P100,00. During
her death it has a fair market value of P750,000. P50,000 of the unpaid mortgage of the inherited property was
paid by her before she died. Her gross estate, other than her inherited property has a fair market value of
P1,350,000. The total losses, indebtedness, taxes, etc.(LITE) and transfer for public purpose amounted to
P300,000.
Rates of vanishing deduction – If the present decedent died within the following period
after the date of prior decedent’s death or after the date of donation:  
0 1 Year 100%
> 1 Year 2 Years 80%
> 2 Years 3 Year 60%
> 3 Years 4 Years 40%
> 4 Years 5 Years 20%
> 5 Years   0%

Format of Computation    
FMV of Inherited property at the time of death ₱750,000.00  
FMV of Gross estate other than Inherited property ₱1,350,000.00  
Total Gross Estate of the present Decedent ₱2,100,000.00  
LITE and property transferred for public used ₱300,000.00  
Value to take   ₱750,000.00
Less Mortgaged paid by the current decedent   -₱50,000.00
Initial basis   ₱700,000.00

Less: Proportional Deductions(LITE and property transferred for public used) (P700,000/ P2,100,0000) *
(Initial basis / Gross estate) x (LITE plus TPU) P300,000 -₱100,000.00
Final Basis   ₱600,000.00
Multiply by Rate of Vanishing Deduction   40%
Vanishing Deduction   ₱240,000.00
 Ms. Vani Shing died unmarried and left a property she inherited from her father 3 ½ years ago. At the time of
her father’s death the property has a fair market value of P800,000 and an unpaid mortgage of P100,00. During
her death it has a fair market value of P750,000. P50,000 of the unpaid mortgage of the inherited property was
paid by her before she died. Her gross estate, other than her inherited property has a fair market value of
P1,350,000. The total losses, indebtedness, taxes, etc.(LITE) and transfer for public purpose amounted to
P300,000.
Rates of vanishing deduction – If the present decedent died within the following period
after the date of prior decedent’s death or after the date of donation:  
0 1 Year 100%
> 1 Year 2 Years 80%
> 2 Years 3 Year 60%
> 3 Years 4 Years 40%
> 4 Years 5 Years 20%
> 5 Years   0%

Format of Computation    
FMV of Inherited property at the time of death ₱750,000.00  
FMV of Gross estate other than Inherited property ₱1,350,000.00  
Total Gross Estate of the present Decedent ₱2,100,000.00  
LITE and property transferred for public used ₱300,000.00  
Value to take   ₱750,000.00
Less Mortgaged paid by the current decedent   -₱50,000.00
Initial basis   ₱700,000.00

Less: Proportional Deductions(LITE and property transferred for public used) (P700,000/ P2,100,0000) *
(Initial basis / Gross estate) x (LITE plus TPU) P300,000 -₱100,000.00
Final Basis   ₱600,000.00
Multiply by Rate of Vanishing Deduction   40%
Vanishing Deduction   ₱240,000.00
 Ms. Vani Shing died unmarried and left a property she inherited from her father 3 ½ years ago. At the time of
her father’s death the property has a fair market value of P800,000 and an unpaid mortgage of P100,00. During
her death it has a fair market value of P750,000. P50,000 of the unpaid mortgage of the inherited property was
paid by her before she died. Her gross estate, other than her inherited property has a fair market value of
P1,350,000. The total losses, indebtedness, taxes, etc.(LITE) and transfer for public purpose amounted to
P300,000.
Rates of vanishing deduction – If the present decedent died within the following period
after the date of prior decedent’s death or after the date of donation:  
0 1 Year 100%
> 1 Year 2 Years 80%
> 2 Years 3 Year 60%
> 3 Years 4 Years 40%
> 4 Years 5 Years 20%
> 5 Years   0%

Format of Computation    
FMV of Inherited property at the time of death ₱750,000.00  
FMV of Gross estate other than Inherited property ₱1,350,000.00  
Total Gross Estate of the present Decedent ₱2,100,000.00  
LITE and property transferred for public used ₱300,000.00  
Value to take   ₱750,000.00
Less Mortgaged paid by the current decedent   -₱50,000.00
Initial basis   ₱700,000.00

Less: Proportional Deductions(LITE and property transferred for public used) (P700,000/ P2,100,0000) *
(Initial basis / Gross estate) x (LITE plus TPU) P300,000 -₱100,000.00
Final Basis   ₱600,000.00
Multiply by Rate of Vanishing Deduction   40%
Vanishing Deduction   ₱240,000.00
 Ms. Vani Shing died unmarried and left a property she inherited from her father 3 ½ years ago. At the time of
her father’s death the property has a fair market value of P800,000 and an unpaid mortgage of P100,00. During
her death it has a fair market value of P750,000. P50,000 of the unpaid mortgage of the inherited property was
paid by her before she died. Her gross estate, other than her inherited property has a fair market value of
P1,350,000. The total losses, indebtedness, taxes, etc.(LITE) and transfer for public purpose amounted to
P300,000.
Rates of vanishing deduction – If the present decedent died within the following period
after the date of prior decedent’s death or after the date of donation:  
0 1 Year 100%
> 1 Year 2 Years 80%
> 2 Years 3 Year 60%
> 3 Years 4 Years 40%
> 4 Years 5 Years 20%
> 5 Years   0%

Format of Computation    
FMV of Inherited property at the time of death ₱750,000.00  
FMV of Gross estate other than Inherited property ₱1,350,000.00  
Total Gross Estate of the present Decedent ₱2,100,000.00  
LITE and property transferred for public used ₱300,000.00  
Value to take   ₱750,000.00
Less Mortgaged paid by the current decedent   -₱50,000.00
Initial basis   ₱700,000.00

Less: Proportional Deductions(LITE and property transferred for public used) (P700,000/ P2,100,0000) *
(Initial basis / Gross estate) x (LITE plus TPU) P300,000 -₱100,000.00
Final Basis   ₱600,000.00
Multiply by Rate of Vanishing Deduction   40%
Vanishing Deduction   ₱240,000.00
 Ms. Vani Shing died unmarried and left a property she inherited from her father 3 ½ years ago. At the time of
her father’s death the property has a fair market value of P800,000 and an unpaid mortgage of P100,00. During
her death it has a fair market value of P750,000. P50,000 of the unpaid mortgage of the inherited property was
paid by her before she died. Her gross estate, other than her inherited property has a fair market value of
P1,350,000. The total losses, indebtedness, taxes, etc.(LITE) and transfer for public purpose amounted to
P300,000.
Rates of vanishing deduction – If the present decedent died within the following period
after the date of prior decedent’s death or after the date of donation:  
0 1 Year 100%
> 1 Year 2 Years 80%
> 2 Years 3 Year 60%
> 3 Years 4 Years 40%
> 4 Years 5 Years 20%
> 5 Years   0%

Format of Computation    
FMV of Inherited property at the time of death ₱750,000.00  
FMV of Gross estate other than Inherited property ₱1,350,000.00  
Total Gross Estate of the present Decedent ₱2,100,000.00  
LITE and property transferred for public used ₱300,000.00  
Value to take   ₱750,000.00
Less Mortgaged paid by the current decedent   -₱50,000.00
Initial basis   ₱700,000.00

Less: Proportional Deductions(LITE and property transferred for public used) (P700,000/ P2,100,0000) *
(Initial basis / Gross estate) x (LITE plus TPU) P300,000 -₱100,000.00
Final Basis   ₱600,000.00
Multiply by Rate of Vanishing Deduction   40%
Vanishing Deduction   ₱240,000.00
 Ms. Vani Shing died unmarried and left a property she inherited from her father 3 ½ years ago. At the time of
her father’s death the property has a fair market value of P800,000 and an unpaid mortgage of P100,00. During
her death it has a fair market value of P750,000. P50,000 of the unpaid mortgage of the inherited property was
paid by her before she died. Her gross estate, other than her inherited property has a fair market value of
P1,350,000. The total losses, indebtedness, taxes, etc.(LITE) and transfer for public purpose amounted to
P300,000.
Rates of vanishing deduction – If the present decedent died within the following period
after the date of prior decedent’s death or after the date of donation:  
0 1 Year 100%
> 1 Year 2 Years 80%
> 2 Years 3 Year 60%
> 3 Years 4 Years 40%
> 4 Years 5 Years 20%
> 5 Years   0%

Format of Computation    
FMV of Inherited property at the time of death ₱750,000.00  
FMV of Gross estate other than Inherited property ₱1,350,000.00  
Total Gross Estate of the present Decedent ₱2,100,000.00  
LITE and property transferred for public used ₱300,000.00  
Value to take   ₱750,000.00
Less Mortgaged paid by the current decedent   -₱50,000.00
Initial basis   ₱700,000.00

Less: Proportional Deductions(LITE and property transferred for public used) (P700,000/ P2,100,0000) *
(Initial basis / Gross estate) x (LITE plus TPU) P300,000 -₱100,000.00
Final Basis   ₱600,000.00
Multiply by Rate of Vanishing Deduction   40%
Vanishing Deduction   ₱240,000.00
 Ms. Vani Shing died unmarried and left a property she inherited from her father 3 ½ years ago. At the time of
her father’s death the property has a fair market value of P800,000 and an unpaid mortgage of P100,00. During
her death it has a fair market value of P750,000. P50,000 of the unpaid mortgage of the inherited property was
paid by her before she died. Her gross estate, other than her inherited property has a fair market value of
P1,350,000. The total losses, indebtedness, taxes, etc.(LITE) and transfer for public purpose amounted to
P300,000.
Rates of vanishing deduction – If the present decedent died within the following period
after the date of prior decedent’s death or after the date of donation:  
0 1 Year 100%
> 1 Year 2 Years 80%
> 2 Years 3 Year 60%
> 3 Years 4 Years 40%
> 4 Years 5 Years 20%
> 5 Years   0%

Format of Computation    
FMV of Inherited property at the time of death ₱750,000.00  
FMV of Gross estate other than Inherited property ₱1,350,000.00  
Total Gross Estate of the present Decedent ₱2,100,000.00  
LITE and property transferred for public used ₱300,000.00  
Value to take   ₱750,000.00
Less Mortgaged paid by the current decedent   -₱50,000.00
Initial basis   ₱700,000.00

Less: Proportional Deductions(LITE and property transferred for public used) (P700,000/ P2,100,0000) *
(Initial basis / Gross estate) x (LITE plus TPU) P300,000 -₱100,000.00
Final Basis   ₱600,000.00
Multiply by Rate of Vanishing Deduction   40%
Vanishing Deduction   ₱240,000.00
 Ms. Vani Shing died unmarried and left a property she inherited from her father 3 ½ years ago. At the time of
her father’s death the property has a fair market value of P800,000 and an unpaid mortgage of P100,00. During
her death it has a fair market value of P750,000. P50,000 of the unpaid mortgage of the inherited property was
paid by her before she died. Her gross estate, other than her inherited property has a fair market value of
P1,350,000. The total losses, indebtedness, taxes, etc.(LITE) and transfer for public purpose amounted to
P300,000.
Rates of vanishing deduction – If the present decedent died within the following period
after the date of prior decedent’s death or after the date of donation:  
0 1 Year 100%
> 1 Year 2 Years 80%
> 2 Years 3 Year 60%
> 3 Years 4 Years 40%
> 4 Years 5 Years 20%
> 5 Years   0%

Format of Computation    
FMV of Inherited property at the time of death ₱750,000.00  
FMV of Gross estate other than Inherited property ₱1,350,000.00  
Total Gross Estate of the present Decedent ₱2,100,000.00  
LITE and property transferred for public used ₱300,000.00  
Value to take   ₱750,000.00
Less Mortgaged paid by the current decedent   -₱50,000.00
Initial basis   ₱700,000.00

Less: Proportional Deductions(LITE and property transferred for public used) (P700,000/ P2,100,0000) *
(Initial basis / Gross estate) x (LITE plus TPU) P300,000 -₱100,000.00
Final Basis   ₱600,000.00
Multiply by Rate of Vanishing Deduction   40%
Vanishing Deduction   ₱240,000.00
 Ms. Vani Shing died unmarried and left a property she inherited from her father 3 ½ years ago. At the time of
her father’s death the property has a fair market value of P800,000 and an unpaid mortgage of P100,00. During
her death it has a fair market value of P750,000. P50,000 of the unpaid mortgage of the inherited property was
paid by her before she died. Her gross estate, other than her inherited property has a fair market value of
P1,350,000. The total losses, indebtedness, taxes, etc.(LITE) and transfer for public purpose amounted to
P300,000.
Rates of vanishing deduction – If the present decedent died within the following period
after the date of prior decedent’s death or after the date of donation:  
0 1 Year 100%
> 1 Year 2 Years 80%
> 2 Years 3 Year 60%
> 3 Years 4 Years 40%
> 4 Years 5 Years 20%
> 5 Years   0%

Format of Computation    
FMV of Inherited property at the time of death ₱750,000.00  
FMV of Gross estate other than Inherited property ₱1,350,000.00  
Total Gross Estate of the present Decedent ₱2,100,000.00  
LITE and property transferred for public used ₱300,000.00  
Value to take   ₱750,000.00
Less Mortgaged paid by the current decedent   -₱50,000.00
Initial basis   ₱700,000.00

Less: Proportional Deductions(LITE and property transferred for public used) (P700,000/ P2,100,0000) *
(Initial basis / Gross estate) x (LITE plus TPU) P300,000 -₱100,000.00
Final Basis   ₱600,000.00
Multiply by Rate of Vanishing Deduction   40%
Vanishing Deduction   ₱240,000.00
• Value taken is the LOWER between the fair market value of the
property in the gross estate of the prior decedent or the fair market
value of the gift and the fair market value of the same property in the
gross estate of the present decedent. Notes:
• 1. Under conjugal partnership of gains vanishing is a deduction from
exclusive property.
• 2. Under absolute community of property, vanishing deduction may
be deducted from exclusive property or community property.
Special Deductions
• Family Home - The family home refers to the dwelling house, including the land on which it
is situated, where the husband and the wife, or an unmarried person who is the head of the
family and members of the family reside, as certified by the Barangay Captain of the locality.
• Conditions for the allowance of family home deduction from the gross estate:
• a. The family home must be the actual residential home of the decedent and his family at
the time of his death, as certified by the Barangay Captain of the locality the family home is
situated
• b. The total value of the family home must be included as part of the gross estate of the
decedent, and
• c. Allowable deduction must be in an amount equivalent to the current fair market value of
the family home as declared or included in the gross estate, or to the extent of the
decedent’s interest (whether conjugal/community or exclusive), whichever is lower, but not
exceeding P10,000,000
Special Deductions
• Family Home - The family home refers to the dwelling house, including the land on which it
is situated, where the husband and the wife, or an unmarried person who is the head of the
family and members of the family reside, as certified by the Barangay Captain of the locality.
• Conditions for the allowance of family home deduction from the gross estate:
• a. The family home must be the actual residential home of the decedent and his family at
the time of his death, as certified by the Barangay Captain of the locality the family home is
situated
• b. The total value of the family home must be included as part of the gross estate of the
decedent, and
• c. Allowable deduction must be in an amount equivalent to the current fair market value of
the family home as declared or included in the gross estate, or to the extent of the
decedent’s interest (whether conjugal/community or exclusive), whichever is lower, but not
exceeding P10,000,000
Standard Deduction
• For resident citizen, non-resident citizen and resident alien  The
amount deductible is P5,000,000 (TRAIN Law) without any required
substantiation
• For non-resident alien  The amount deductible is P500,000 without
any required substantiation.
 Non Resident Resident Non resident
  Exclusive Common Resident Citizen Citizen Alien Alien
Ordinary Deductions          
Losses Yes Yes Yes Yes Yes Yes Prorated
Indebtedness Yes Yes Yes Yes Yes Yes Prorated
Taxes Yes Yes Yes Yes Yes Yes Prorated
Etc. Unpaid mortgage/ Claims Against
Insolvent Yes Yes Yes Yes Yes Yes Prorated
Transfer for public use Yes No Yes Yes Yes Yes
Property Previously Taxed ( Vanishing
Deductions) Yes Yes Yes Yes Yes Yes
Special Deductions            
Family Home NA   Yes Yes Yes No
Standard Deduction NA   5,000,000 5,000,000 5,000,000 500,000
RA 4917 NA   Yes Yes Yes No
 Non Resident Resident Non resident
  Exclusive Common Resident Citizen Citizen Alien Alien
Ordinary Deductions          
Losses Yes Yes Yes Yes Yes Yes Prorated
Indebtedness Yes Yes Yes Yes Yes Yes Prorated
Taxes Yes Yes Yes Yes Yes Yes Prorated
Etc. Unpaid mortgage/ Claims Against
Insolvent Yes Yes Yes Yes Yes Yes Prorated
Transfer for public use Yes No Yes Yes Yes Yes
Property Previously Taxed ( Vanishing
Deductions) Yes Yes Yes Yes Yes Yes
Special Deductions            
Family Home NA   Yes Yes Yes No
Standard Deduction NA   5,000,000 5,000,000 5,000,000 500,000
RA 4917 NA   Yes Yes Yes No
 Non Resident Resident Non resident
  Exclusive Common Resident Citizen Citizen Alien Alien
Ordinary Deductions          
Losses Yes Yes Yes Yes Yes Yes Prorated
Indebtedness Yes Yes Yes Yes Yes Yes Prorated
Taxes Yes Yes Yes Yes Yes Yes Prorated
Etc. Unpaid mortgage/ Claims Against
Insolvent Yes Yes Yes Yes Yes Yes Prorated
Transfer for public use Yes No Yes Yes Yes Yes
Property Previously Taxed ( Vanishing
Deductions) Yes Yes Yes Yes Yes Yes
Special Deductions            
Family Home NA   Yes Yes Yes No
Standard Deduction NA   5,000,000 5,000,000 5,000,000 500,000
RA 4917 NA   Yes Yes Yes No
 Non Resident Resident Non resident
  Exclusive Common Resident Citizen Citizen Alien Alien
Ordinary Deductions          
Losses Yes Yes Yes Yes Yes Yes Prorated
Indebtedness Yes Yes Yes Yes Yes Yes Prorated
Taxes Yes Yes Yes Yes Yes Yes Prorated
Etc. Unpaid mortgage/ Claims Against
Insolvent Yes Yes Yes Yes Yes Yes Prorated
Transfer for public use Yes No Yes Yes Yes Yes
Property Previously Taxed ( Vanishing
Deductions) Yes Yes Yes Yes Yes Yes
Special Deductions            
Family Home NA   Yes Yes Yes No
Standard Deduction NA   5,000,000 5,000,000 5,000,000 500,000
RA 4917 NA   Yes Yes Yes No
 Non Resident Resident Non resident
  Exclusive Common Resident Citizen Citizen Alien Alien
Ordinary Deductions          
Losses Yes Yes Yes Yes Yes Yes Prorated
Indebtedness Yes Yes Yes Yes Yes Yes Prorated
Taxes Yes Yes Yes Yes Yes Yes Prorated
Etc. Unpaid mortgage/ Claims Against
Insolvent Yes Yes Yes Yes Yes Yes Prorated
Transfer for public use Yes No Yes Yes Yes Yes
Property Previously Taxed ( Vanishing
Deductions) Yes Yes Yes Yes Yes Yes
Special Deductions            
Family Home NA   Yes Yes Yes No
Standard Deduction NA   5,000,000 5,000,000 5,000,000 500,000
RA 4917 NA   Yes Yes Yes No
 Non Resident Resident Non resident
  Exclusive Common Resident Citizen Citizen Alien Alien
Ordinary Deductions          
Losses Yes Yes Yes Yes Yes Yes Prorated
Indebtedness Yes Yes Yes Yes Yes Yes Prorated
Taxes Yes Yes Yes Yes Yes Yes Prorated
Etc. Unpaid mortgage/ Claims Against
Insolvent Yes Yes Yes Yes Yes Yes Prorated
Transfer for public use Yes No Yes Yes Yes Yes
Property Previously Taxed ( Vanishing
Deductions) Yes Yes Yes Yes Yes Yes
Special Deductions            
Family Home NA   Yes Yes Yes No
Standard Deduction NA   5,000,000 5,000,000 5,000,000 500,000
RA 4917 NA   Yes Yes Yes No
 Non Resident Resident Non resident
  Exclusive Common Resident Citizen Citizen Alien Alien
Ordinary Deductions          
Losses Yes Yes Yes Yes Yes Yes Prorated
Indebtedness Yes Yes Yes Yes Yes Yes Prorated
Taxes Yes Yes Yes Yes Yes Yes Prorated
Etc. Unpaid mortgage/ Claims Against
Insolvent Yes Yes Yes Yes Yes Yes Prorated
Transfer for public use Yes No Yes Yes Yes Yes
Property Previously Taxed ( Vanishing
Deductions) Yes Yes Yes Yes Yes Yes
Special Deductions            
Family Home NA   Yes Yes Yes No
Standard Deduction NA   5,000,000 5,000,000 5,000,000 500,000
RA 4917 NA   Yes Yes Yes No
 Non Resident Resident Non resident
  Exclusive Common Resident Citizen Citizen Alien Alien
Ordinary Deductions          
Losses Yes Yes Yes Yes Yes Yes Prorated
Indebtedness Yes Yes Yes Yes Yes Yes Prorated
Taxes Yes Yes Yes Yes Yes Yes Prorated
Etc. Unpaid mortgage/ Claims Against
Insolvent Yes Yes Yes Yes Yes Yes Prorated
Transfer for public use Yes No Yes Yes Yes Yes
Property Previously Taxed ( Vanishing
Deductions) Yes Yes Yes Yes Yes Yes
Special Deductions            
Family Home NA   Yes Yes Yes No
Standard Deduction NA   5,000,000 5,000,000 5,000,000 500,000
RA 4917 NA   Yes Yes Yes No
Less Share of
the Surviving
Spouse
George James is non-resident Chinese citizen. He died testate and left the following properties:   With in With out Total
Car, Philippines (Received as donation 2 years before his death, FMV, date of donation
P1,500,000) ₱1,000,000.00 ₱1,000,000.00   ₱1,000,000.00
Car, Shanghai, China ₱900,000.00   ₱900,000.00 ₱900,000.00
Bonds, Philippines ₱1,000,000.00 ₱1,000,000.00   ₱1,000,000.00
Shares of stock, Shanghai, China ₱600,000.00   ₱600,000.00 ₱600,000.00
House and lot, China (Mortgaged for P200,000) ₱1,800,000.00   ₱1,800,000.00 ₱1,800,000.00
Cash deposit, BDO-Sampaloc, Manila ₱1,200,000.00 ₱1,200,000.00   ₱1,200,000.00
Other tangible personal properties, Manila ₱500,000.00 ₱500,000.00   ₱500,000.00
Franchise, exercised in the Philippines ₱2,500,000.00 ₱2,500,000.00   ₱2,500,000.00
Shares of stock issued by a foreign corporation ₱1,500,000.00   ₱1,500,000.00 ₱1,500,000.00
Claims Against Insolvent peron   ₱100,000.00    
Gross Estate   ₱6,300,000.00 ₱4,800,000.00 ₱11,100,000.00
His cousin, Lebron James was assigned as the executor of his last will and testament. Lebron
sought your advice and presented to you the list of
expenses and deductions relating to the estate of George as follows:        
Actual funeral expenses (defrayed by relatives) ₱100,000.00   ₱0.00  
Judicial expenses (extra judicial settlement) ₱300,000.00   ₱0.00  
Loss of certain tangible personal properties ₱250,000.00   ₱250,000.00  
Claims against the estate ₱100,000.00   ₱100,000.00  
Unpaid taxes, accrued after death ₱150,000.00   ₱0.00  
Claims against insolvent person ₱100,000.00   ₱100,000.00  
Unpaid Mortgage ₱200,000.00   ₱200,000.00  
Total LITE     ₱650,000.00  
Allowed LITE PRO RATED (P6,300.000/P11,000,000) P650,000       ₱368,918.92
Transfer for public use ₱100,000.00     ₱100,000.00
Medical expenses ₱100,000.00      
Vanishing Deductions       ₱740,454.74
Total Ordinary Deduction       ₱1,209,373.66
Standard Deduction       ₱500,000.00
Taxable Net Estate       ₱4,590,626.34
        6%
Tax Due       ₱275,437.58
George James is non-resident Chinese citizen. He died testate and left the following properties:   With in With out Total
Car, Philippines (Received as donation 2 years before his death, FMV, date of donation
P1,500,000) ₱1,000,000.00 ₱1,000,000.00   ₱1,000,000.00
Car, Shanghai, China ₱900,000.00   ₱900,000.00 ₱900,000.00
Bonds, Philippines ₱1,000,000.00 ₱1,000,000.00   ₱1,000,000.00
Shares of stock, Shanghai, China ₱600,000.00   ₱600,000.00 ₱600,000.00
House and lot, China (Mortgaged for P200,000) ₱1,800,000.00   ₱1,800,000.00 ₱1,800,000.00
Cash deposit, BDO-Sampaloc, Manila ₱1,200,000.00 ₱1,200,000.00   ₱1,200,000.00
Other tangible personal properties, Manila ₱500,000.00 ₱500,000.00   ₱500,000.00
Franchise, exercised in the Philippines ₱2,500,000.00 ₱2,500,000.00   ₱2,500,000.00
Shares of stock issued by a foreign corporation ₱1,500,000.00   ₱1,500,000.00 ₱1,500,000.00
Claims Against Insolvent peron   ₱100,000.00    
Gross Estate   ₱6,300,000.00 ₱4,800,000.00 ₱11,100,000.00
His cousin, Lebron James was assigned as the executor of his last will and testament. Lebron
sought your advice and presented to you the list of
expenses and deductions relating to the estate of George as follows:        
Actual funeral expenses (defrayed by relatives) ₱100,000.00   ₱0.00  
Judicial expenses (extra judicial settlement) ₱300,000.00   ₱0.00  
Loss of certain tangible personal properties ₱250,000.00   ₱250,000.00  
Claims against the estate ₱100,000.00   ₱100,000.00  
Unpaid taxes, accrued after death ₱150,000.00   ₱0.00  
Claims against insolvent person ₱100,000.00   ₱100,000.00  
Unpaid Mortgage ₱200,000.00   ₱200,000.00  
Total LITE     ₱650,000.00  
Allowed LITE PRO RATED (P6,300.000/P11,000,000) P650,000       ₱368,918.92
Transfer for public use ₱100,000.00     ₱100,000.00
Medical expenses ₱100,000.00      
Vanishing Deductions       ₱740,454.74
Total Ordinary Deduction       ₱1,209,373.66
Standard Deduction       ₱500,000.00
Taxable Net Estate       ₱4,590,626.34
        6%
Tax Due       ₱275,437.58
George James is non-resident Chinese citizen. He died testate and left the following properties:   With in With out Total
Car, Philippines (Received as donation 2 years before his death, FMV, date of donation
P1,500,000) ₱1,000,000.00 ₱1,000,000.00   ₱1,000,000.00
Car, Shanghai, China ₱900,000.00   ₱900,000.00 ₱900,000.00
Bonds, Philippines ₱1,000,000.00 ₱1,000,000.00   ₱1,000,000.00
Shares of stock, Shanghai, China ₱600,000.00   ₱600,000.00 ₱600,000.00
House and lot, China (Mortgaged for P200,000) ₱1,800,000.00   ₱1,800,000.00 ₱1,800,000.00
Cash deposit, BDO-Sampaloc, Manila ₱1,200,000.00 ₱1,200,000.00   ₱1,200,000.00
Other tangible personal properties, Manila ₱500,000.00 ₱500,000.00   ₱500,000.00
Franchise, exercised in the Philippines ₱2,500,000.00 ₱2,500,000.00   ₱2,500,000.00
Shares of stock issued by a foreign corporation ₱1,500,000.00   ₱1,500,000.00 ₱1,500,000.00
Claims Against Insolvent peron   ₱100,000.00    
Gross Estate   ₱6,300,000.00 ₱4,800,000.00 ₱11,100,000.00
His cousin, Lebron James was assigned as the executor of his last will and testament. Lebron
sought your advice and presented to you the list of
expenses and deductions relating to the estate of George as follows:        
Actual funeral expenses (defrayed by relatives) ₱100,000.00   ₱0.00  
Judicial expenses (extra judicial settlement) ₱300,000.00   ₱0.00  
Loss of certain tangible personal properties ₱250,000.00   ₱250,000.00  
Claims against the estate ₱100,000.00   ₱100,000.00  
Unpaid taxes, accrued after death ₱150,000.00   ₱0.00  
Claims against insolvent person ₱100,000.00   ₱100,000.00  
Unpaid Mortgage ₱200,000.00   ₱200,000.00  
Total LITE     ₱650,000.00  
Allowed LITE PRO RATED (P6,300.000/P11,000,000) P650,000       ₱368,918.92
Transfer for public use ₱100,000.00     ₱100,000.00
Medical expenses ₱100,000.00      
Vanishing Deductions       ₱740,454.74
Total Ordinary Deduction       ₱1,209,373.66
Standard Deduction       ₱500,000.00
Taxable Net Estate       ₱4,590,626.34
        6%
Tax Due       ₱275,437.58
George James is non-resident Chinese citizen. He died testate and left the following properties:   With in With out Total
Car, Philippines (Received as donation 2 years before his death, FMV, date of donation
P1,500,000) ₱1,000,000.00 ₱1,000,000.00   ₱1,000,000.00
Car, Shanghai, China ₱900,000.00   ₱900,000.00 ₱900,000.00
Bonds, Philippines ₱1,000,000.00 ₱1,000,000.00   ₱1,000,000.00
Shares of stock, Shanghai, China ₱600,000.00   ₱600,000.00 ₱600,000.00
House and lot, China (Mortgaged for P200,000) ₱1,800,000.00   ₱1,800,000.00 ₱1,800,000.00
Cash deposit, BDO-Sampaloc, Manila ₱1,200,000.00 ₱1,200,000.00   ₱1,200,000.00
Other tangible personal properties, Manila ₱500,000.00 ₱500,000.00   ₱500,000.00
Franchise, exercised in the Philippines ₱2,500,000.00 ₱2,500,000.00   ₱2,500,000.00
Shares of stock issued by a foreign corporation ₱1,500,000.00   ₱1,500,000.00 ₱1,500,000.00
Claims Against Insolvent peron   ₱100,000.00    
Gross Estate   ₱6,300,000.00 ₱4,800,000.00 ₱11,100,000.00
His cousin, Lebron James was assigned as the executor of his last will and testament. Lebron
sought your advice and presented to you the list of
expenses and deductions relating to the estate of George as follows:        
Actual funeral expenses (defrayed by relatives) ₱100,000.00   ₱0.00  
Judicial expenses (extra judicial settlement) ₱300,000.00   ₱0.00  
Loss of certain tangible personal properties ₱250,000.00   ₱250,000.00  
Claims against the estate ₱100,000.00   ₱100,000.00  
Unpaid taxes, accrued after death ₱150,000.00   ₱0.00  
Claims against insolvent person ₱100,000.00   ₱100,000.00  
Unpaid Mortgage ₱200,000.00   ₱200,000.00  
Total LITE     ₱650,000.00  
Allowed LITE PRO RATED (P6,300.000/P11,000,000) P650,000       ₱368,918.92
Transfer for public use ₱100,000.00     ₱100,000.00
Medical expenses ₱100,000.00      
Vanishing Deductions       ₱740,454.74
Total Ordinary Deduction       ₱1,209,373.66
Standard Deduction       ₱500,000.00
Taxable Net Estate       ₱4,590,626.34
        6%
Tax Due       ₱275,437.58
George James is non-resident Chinese citizen. He died testate and left the following properties:   With in With out Total
Car, Philippines (Received as donation 2 years before his death, FMV, date of donation
P1,500,000) ₱1,000,000.00 ₱1,000,000.00   ₱1,000,000.00
Car, Shanghai, China ₱900,000.00   ₱900,000.00 ₱900,000.00
Bonds, Philippines ₱1,000,000.00 ₱1,000,000.00   ₱1,000,000.00
Shares of stock, Shanghai, China ₱600,000.00   ₱600,000.00 ₱600,000.00
House and lot, China (Mortgaged for P200,000) ₱1,800,000.00   ₱1,800,000.00 ₱1,800,000.00
Cash deposit, BDO-Sampaloc, Manila ₱1,200,000.00 ₱1,200,000.00   ₱1,200,000.00
Other tangible personal properties, Manila ₱500,000.00 ₱500,000.00   ₱500,000.00
Franchise, exercised in the Philippines ₱2,500,000.00 ₱2,500,000.00   ₱2,500,000.00
Shares of stock issued by a foreign corporation ₱1,500,000.00   ₱1,500,000.00 ₱1,500,000.00
Claims Against Insolvent peron   ₱100,000.00    
Gross Estate   ₱6,300,000.00 ₱4,800,000.00 ₱11,100,000.00
His cousin, Lebron James was assigned as the executor of his last will and testament. Lebron
sought your advice and presented to you the list of
expenses and deductions relating to the estate of George as follows:        
Actual funeral expenses (defrayed by relatives) ₱100,000.00   ₱0.00  
Judicial expenses (extra judicial settlement) ₱300,000.00   ₱0.00  
Loss of certain tangible personal properties ₱250,000.00   ₱250,000.00  
Claims against the estate ₱100,000.00   ₱100,000.00  
Unpaid taxes, accrued after death ₱150,000.00   ₱0.00  
Claims against insolvent person ₱100,000.00   ₱100,000.00  
Unpaid Mortgage ₱200,000.00   ₱200,000.00  
Total LITE     ₱650,000.00  
Allowed LITE PRO RATED (P6,300.000/P11,000,000) P650,000       ₱368,918.92
Transfer for public use ₱100,000.00     ₱100,000.00
Medical expenses ₱100,000.00      
Vanishing Deductions       ₱740,454.74
Total Ordinary Deduction       ₱1,209,373.66
Standard Deduction       ₱500,000.00
Taxable Net Estate       ₱4,590,626.34
        6%
Tax Due       ₱275,437.58
George James is non-resident Chinese citizen. He died testate and left the following properties:   With in With out Total
Car, Philippines (Received as donation 2 years before his death, FMV, date of donation
P1,500,000) ₱1,000,000.00 ₱1,000,000.00   ₱1,000,000.00
Car, Shanghai, China ₱900,000.00   ₱900,000.00 ₱900,000.00
Bonds, Philippines ₱1,000,000.00 ₱1,000,000.00   ₱1,000,000.00
Shares of stock, Shanghai, China ₱600,000.00   ₱600,000.00 ₱600,000.00
House and lot, China (Mortgaged for P200,000) ₱1,800,000.00   ₱1,800,000.00 ₱1,800,000.00
Cash deposit, BDO-Sampaloc, Manila ₱1,200,000.00 ₱1,200,000.00   ₱1,200,000.00
Other tangible personal properties, Manila ₱500,000.00 ₱500,000.00   ₱500,000.00
Franchise, exercised in the Philippines ₱2,500,000.00 ₱2,500,000.00   ₱2,500,000.00
Shares of stock issued by a foreign corporation ₱1,500,000.00   ₱1,500,000.00 ₱1,500,000.00
Claims Against Insolvent peron   ₱100,000.00    
Gross Estate   ₱6,300,000.00 ₱4,800,000.00 ₱11,100,000.00
His cousin, Lebron James was assigned as the executor of his last will and testament. Lebron
sought your advice and presented to you the list of
expenses and deductions relating to the estate of George as follows:        
Actual funeral expenses (defrayed by relatives) ₱100,000.00   ₱0.00  
Judicial expenses (extra judicial settlement) ₱300,000.00   ₱0.00  
Loss of certain tangible personal properties ₱250,000.00   ₱250,000.00  
Claims against the estate ₱100,000.00   ₱100,000.00  
Unpaid taxes, accrued after death ₱150,000.00   ₱0.00  
Claims against insolvent person ₱100,000.00   ₱100,000.00  
Unpaid Mortgage ₱200,000.00   ₱200,000.00  
Total LITE     ₱650,000.00  
Allowed LITE PRO RATED (P6,300.000/P11,000,000) P650,000       ₱368,918.92
Transfer for public use ₱100,000.00     ₱100,000.00
Medical expenses ₱100,000.00      
Vanishing Deductions       ₱740,454.74
Total Ordinary Deduction       ₱1,209,373.66
Standard Deduction       ₱500,000.00
Taxable Net Estate       ₱4,590,626.34
        6%
Tax Due       ₱275,437.58
George James is non-resident Chinese citizen. He died testate and left the following properties:   With in With out Total
Car, Philippines (Received as donation 2 years before his death, FMV, date of donation
P1,500,000) ₱1,000,000.00 ₱1,000,000.00   ₱1,000,000.00
Car, Shanghai, China ₱900,000.00   ₱900,000.00 ₱900,000.00
Bonds, Philippines ₱1,000,000.00 ₱1,000,000.00   ₱1,000,000.00
Shares of stock, Shanghai, China ₱600,000.00   ₱600,000.00 ₱600,000.00
House and lot, China (Mortgaged for P200,000) ₱1,800,000.00   ₱1,800,000.00 ₱1,800,000.00
Cash deposit, BDO-Sampaloc, Manila ₱1,200,000.00 ₱1,200,000.00   ₱1,200,000.00
Other tangible personal properties, Manila ₱500,000.00 ₱500,000.00   ₱500,000.00
Franchise, exercised in the Philippines ₱2,500,000.00 ₱2,500,000.00   ₱2,500,000.00
Shares of stock issued by a foreign corporation ₱1,500,000.00   ₱1,500,000.00 ₱1,500,000.00
Claims Against Insolvent peron   ₱100,000.00    
Gross Estate   ₱6,300,000.00 ₱4,800,000.00 ₱11,100,000.00
His cousin, Lebron James was assigned as the executor of his last will and testament. Lebron
sought your advice and presented to you the list of
expenses and deductions relating to the estate of George as follows:        
Actual funeral expenses (defrayed by relatives) ₱100,000.00   ₱0.00  
Judicial expenses (extra judicial settlement) ₱300,000.00   ₱0.00  
Loss of certain tangible personal properties ₱250,000.00   ₱250,000.00  
Claims against the estate ₱100,000.00   ₱100,000.00  
Unpaid taxes, accrued after death ₱150,000.00   ₱0.00  
Claims against insolvent person ₱100,000.00   ₱100,000.00  
Unpaid Mortgage ₱200,000.00   ₱200,000.00  
Total LITE     ₱650,000.00  
Allowed LITE PRO RATED (P6,300.000/P11,000,000) P650,000       ₱368,918.92
Transfer for public use ₱100,000.00     ₱100,000.00
Medical expenses ₱100,000.00      
Vanishing Deductions       ₱740,454.74
Total Ordinary Deduction       ₱1,209,373.66
Standard Deduction       ₱500,000.00
Taxable Net Estate       ₱4,590,626.34
        6%
Tax Due       ₱275,437.58
George James is non-resident Chinese citizen. He died testate and left the following properties:   With in With out Total
Car, Philippines (Received as donation 2 years before his death, FMV, date of donation
P1,500,000) ₱1,000,000.00 ₱1,000,000.00   ₱1,000,000.00
Car, Shanghai, China ₱900,000.00   ₱900,000.00 ₱900,000.00
Bonds, Philippines ₱1,000,000.00 ₱1,000,000.00   ₱1,000,000.00
Shares of stock, Shanghai, China ₱600,000.00   ₱600,000.00 ₱600,000.00
House and lot, China (Mortgaged for P200,000) ₱1,800,000.00   ₱1,800,000.00 ₱1,800,000.00
Cash deposit, BDO-Sampaloc, Manila ₱1,200,000.00 ₱1,200,000.00   ₱1,200,000.00
Other tangible personal properties, Manila ₱500,000.00 ₱500,000.00   ₱500,000.00
Franchise, exercised in the Philippines ₱2,500,000.00 ₱2,500,000.00   ₱2,500,000.00
Shares of stock issued by a foreign corporation ₱1,500,000.00   ₱1,500,000.00 ₱1,500,000.00
Claims Against Insolvent peron   ₱100,000.00    
Gross Estate   ₱6,300,000.00 ₱4,800,000.00 ₱11,100,000.00
His cousin, Lebron James was assigned as the executor of his last will and testament. Lebron
sought your advice and presented to you the list of
expenses and deductions relating to the estate of George as follows:        
Actual funeral expenses (defrayed by relatives) ₱100,000.00   ₱0.00  
Judicial expenses (extra judicial settlement) ₱300,000.00   ₱0.00  
Loss of certain tangible personal properties ₱250,000.00   ₱250,000.00  
Claims against the estate ₱100,000.00   ₱100,000.00  
Unpaid taxes, accrued after death ₱150,000.00   ₱0.00  
Claims against insolvent person ₱100,000.00   ₱100,000.00  
Unpaid Mortgage ₱200,000.00   ₱200,000.00  
Total LITE     ₱650,000.00  
Allowed LITE PRO RATED (P6,300.000/P11,000,000) P650,000       ₱368,918.92
Transfer for public use ₱100,000.00     ₱100,000.00
Medical expenses ₱100,000.00      
Vanishing Deductions       ₱740,454.74
Total Ordinary Deduction       ₱1,209,373.66
Standard Deduction       ₱500,000.00
Taxable Net Estate       ₱4,590,626.34
        6%
Tax Due       ₱275,437.58
George James is non-resident Chinese citizen. He died testate and left the following properties:   With in With out Total
Car, Philippines (Received as donation 2 years before his death, FMV, date of donation
P1,500,000) ₱1,000,000.00 ₱1,000,000.00   ₱1,000,000.00
Car, Shanghai, China ₱900,000.00   ₱900,000.00 ₱900,000.00
Bonds, Philippines ₱1,000,000.00 ₱1,000,000.00   ₱1,000,000.00
Shares of stock, Shanghai, China ₱600,000.00   ₱600,000.00 ₱600,000.00
House and lot, China (Mortgaged for P200,000) ₱1,800,000.00   ₱1,800,000.00 ₱1,800,000.00
Cash deposit, BDO-Sampaloc, Manila ₱1,200,000.00 ₱1,200,000.00   ₱1,200,000.00
Other tangible personal properties, Manila ₱500,000.00 ₱500,000.00   ₱500,000.00
Franchise, exercised in the Philippines ₱2,500,000.00 ₱2,500,000.00   ₱2,500,000.00
Shares of stock issued by a foreign corporation ₱1,500,000.00   ₱1,500,000.00 ₱1,500,000.00
Claims Against Insolvent peron   ₱100,000.00    
Gross Estate   ₱6,300,000.00 ₱4,800,000.00 ₱11,100,000.00
His cousin, Lebron James was assigned as the executor of his last will and testament. Lebron
sought your advice and presented to you the list of
expenses and deductions relating to the estate of George as follows:        
Actual funeral expenses (defrayed by relatives) ₱100,000.00   ₱0.00  
Judicial expenses (extra judicial settlement) ₱300,000.00   ₱0.00  
Loss of certain tangible personal properties ₱250,000.00   ₱250,000.00  
Claims against the estate ₱100,000.00   ₱100,000.00  
Unpaid taxes, accrued after death ₱150,000.00   ₱0.00  
Claims against insolvent person ₱100,000.00   ₱100,000.00  
Unpaid Mortgage ₱200,000.00   ₱200,000.00  
Total LITE     ₱650,000.00  
Allowed LITE PRO RATED (P6,300.000/P11,000,000) P650,000       ₱368,918.92
Transfer for public use ₱100,000.00     ₱100,000.00
Medical expenses ₱100,000.00      
Vanishing Deductions       ₱740,454.74
Total Ordinary Deduction       ₱1,209,373.66
Standard Deduction       ₱500,000.00
Taxable Net Estate       ₱4,590,626.34
        6%
Tax Due       ₱275,437.58
George James is non-resident Chinese citizen. He died testate and left the following properties:   With in With out Total
Car, Philippines (Received as donation 2 years before his death, FMV, date of donation
P1,500,000) ₱1,000,000.00 ₱1,000,000.00   ₱1,000,000.00
Car, Shanghai, China ₱900,000.00   ₱900,000.00 ₱900,000.00
Bonds, Philippines ₱1,000,000.00 ₱1,000,000.00   ₱1,000,000.00
Shares of stock, Shanghai, China ₱600,000.00   ₱600,000.00 ₱600,000.00
House and lot, China (Mortgaged for P200,000) ₱1,800,000.00   ₱1,800,000.00 ₱1,800,000.00
Cash deposit, BDO-Sampaloc, Manila ₱1,200,000.00 ₱1,200,000.00   ₱1,200,000.00
Other tangible personal properties, Manila ₱500,000.00 ₱500,000.00   ₱500,000.00
Franchise, exercised in the Philippines ₱2,500,000.00 ₱2,500,000.00   ₱2,500,000.00
Shares of stock issued by a foreign corporation ₱1,500,000.00   ₱1,500,000.00 ₱1,500,000.00
Claims Against Insolvent peron   ₱100,000.00    
Gross Estate   ₱6,300,000.00 ₱4,800,000.00 ₱11,100,000.00
His cousin, Lebron James was assigned as the executor of his last will and testament. Lebron
sought your advice and presented to you the list of
expenses and deductions relating to the estate of George as follows:        
Actual funeral expenses (defrayed by relatives) ₱100,000.00   ₱0.00  
Judicial expenses (extra judicial settlement) ₱300,000.00   ₱0.00  
Loss of certain tangible personal properties ₱250,000.00   ₱250,000.00  
Claims against the estate ₱100,000.00   ₱100,000.00  
Unpaid taxes, accrued after death ₱150,000.00   ₱0.00  
Claims against insolvent person ₱100,000.00   ₱100,000.00  
Unpaid Mortgage ₱200,000.00   ₱200,000.00  
Total LITE     ₱650,000.00  
Allowed LITE PRO RATED (P6,300.000/P11,000,000) P650,000       ₱368,918.92
Transfer for public use ₱100,000.00     ₱100,000.00
Medical expenses ₱100,000.00      
Vanishing Deductions       ₱740,454.74
Total Ordinary Deduction       ₱1,209,373.66
Standard Deduction       ₱500,000.00
Taxable Net Estate       ₱4,590,626.34
        6%
Tax Due       ₱275,437.58
George James is non-resident Chinese citizen. He died testate and left the following properties:   With in With out Total
Car, Philippines (Received as donation 2 years before his death, FMV, date of donation
P1,500,000) ₱1,000,000.00 ₱1,000,000.00   ₱1,000,000.00
Car, Shanghai, China ₱900,000.00   ₱900,000.00 ₱900,000.00
Bonds, Philippines ₱1,000,000.00 ₱1,000,000.00   ₱1,000,000.00
Shares of stock, Shanghai, China ₱600,000.00   ₱600,000.00 ₱600,000.00
House and lot, China (Mortgaged for P200,000) ₱1,800,000.00   ₱1,800,000.00 ₱1,800,000.00
Cash deposit, BDO-Sampaloc, Manila ₱1,200,000.00 ₱1,200,000.00   ₱1,200,000.00
Other tangible personal properties, Manila ₱500,000.00 ₱500,000.00   ₱500,000.00
Franchise, exercised in the Philippines ₱2,500,000.00 ₱2,500,000.00   ₱2,500,000.00
Shares of stock issued by a foreign corporation ₱1,500,000.00   ₱1,500,000.00 ₱1,500,000.00
Claims Against Insolvent peron   ₱100,000.00    
Gross Estate   ₱6,300,000.00 ₱4,800,000.00 ₱11,100,000.00
His cousin, Lebron James was assigned as the executor of his last will and testament. Lebron
sought your advice and presented to you the list of
expenses and deductions relating to the estate of George as follows:        
Actual funeral expenses (defrayed by relatives) ₱100,000.00   ₱0.00  
Judicial expenses (extra judicial settlement) ₱300,000.00   ₱0.00  
Loss of certain tangible personal properties ₱250,000.00   ₱250,000.00  
Claims against the estate ₱100,000.00   ₱100,000.00  
Unpaid taxes, accrued after death ₱150,000.00   ₱0.00  
Claims against insolvent person ₱100,000.00   ₱100,000.00  
Unpaid Mortgage ₱200,000.00   ₱200,000.00  
Total LITE     ₱650,000.00  
Allowed LITE PRO RATED (P6,300.000/P11,000,000) P650,000       ₱368,918.92
Transfer for public use ₱100,000.00     ₱100,000.00
Medical expenses ₱100,000.00      
Vanishing Deductions       ₱740,454.74
Total Ordinary Deduction       ₱1,209,373.66
Standard Deduction       ₱500,000.00
Taxable Net Estate       ₱4,590,626.34
        6%
Tax Due       ₱275,437.58
George James is non-resident Chinese citizen. He died testate and left the following properties:   With in With out Total
Car, Philippines (Received as donation 2 years before his death, FMV, date of donation
P1,500,000) ₱1,000,000.00 ₱1,000,000.00   ₱1,000,000.00
Car, Shanghai, China ₱900,000.00   ₱900,000.00 ₱900,000.00
Bonds, Philippines ₱1,000,000.00 ₱1,000,000.00   ₱1,000,000.00
Shares of stock, Shanghai, China ₱600,000.00   ₱600,000.00 ₱600,000.00
House and lot, China (Mortgaged for P200,000) ₱1,800,000.00   ₱1,800,000.00 ₱1,800,000.00
Cash deposit, BDO-Sampaloc, Manila ₱1,200,000.00 ₱1,200,000.00   ₱1,200,000.00
Other tangible personal properties, Manila ₱500,000.00 ₱500,000.00   ₱500,000.00
Franchise, exercised in the Philippines ₱2,500,000.00 ₱2,500,000.00   ₱2,500,000.00
Shares of stock issued by a foreign corporation ₱1,500,000.00   ₱1,500,000.00 ₱1,500,000.00
Claims Against Insolvent peron   ₱100,000.00    
Gross Estate   ₱6,300,000.00 ₱4,800,000.00 ₱11,100,000.00
His cousin, Lebron James was assigned as the executor of his last will and testament. Lebron
sought your advice and presented to you the list of
expenses and deductions relating to the estate of George as follows:        
Actual funeral expenses (defrayed by relatives) ₱100,000.00   ₱0.00  
Judicial expenses (extra judicial settlement) ₱300,000.00   ₱0.00  
Loss of certain tangible personal properties ₱250,000.00   ₱250,000.00  
Claims against the estate ₱100,000.00   ₱100,000.00  
Unpaid taxes, accrued after death ₱150,000.00   ₱0.00  
Claims against insolvent person ₱100,000.00   ₱100,000.00  
Unpaid Mortgage ₱200,000.00   ₱200,000.00  
Total LITE     ₱650,000.00  
Allowed LITE PRO RATED (P6,300.000/P11,000,000) P650,000       ₱368,918.92
Transfer for public use ₱100,000.00     ₱100,000.00
Medical expenses ₱100,000.00      
Vanishing Deductions       ₱740,454.74
Total Ordinary Deduction       ₱1,209,373.66
Standard Deduction       ₱500,000.00
Taxable Net Estate       ₱4,590,626.34
        6%
Tax Due       ₱275,437.58
George James is non-resident Chinese citizen. He died testate and left the following properties:   With in With out Total
Car, Philippines (Received as donation 2 years before his death, FMV, date of donation
P1,500,000) ₱1,000,000.00 ₱1,000,000.00   ₱1,000,000.00
Car, Shanghai, China ₱900,000.00   ₱900,000.00 ₱900,000.00
Bonds, Philippines ₱1,000,000.00 ₱1,000,000.00   ₱1,000,000.00
Shares of stock, Shanghai, China ₱600,000.00   ₱600,000.00 ₱600,000.00
House and lot, China (Mortgaged for P200,000) ₱1,800,000.00   ₱1,800,000.00 ₱1,800,000.00
Cash deposit, BDO-Sampaloc, Manila ₱1,200,000.00 ₱1,200,000.00   ₱1,200,000.00
Other tangible personal properties, Manila ₱500,000.00 ₱500,000.00   ₱500,000.00
Franchise, exercised in the Philippines ₱2,500,000.00 ₱2,500,000.00   ₱2,500,000.00
Shares of stock issued by a foreign corporation ₱1,500,000.00   ₱1,500,000.00 ₱1,500,000.00
Claims Against Insolvent peron   ₱100,000.00    
Gross Estate   ₱6,300,000.00 ₱4,800,000.00 ₱11,100,000.00
His cousin, Lebron James was assigned as the executor of his last will and testament. Lebron
sought your advice and presented to you the list of
expenses and deductions relating to the estate of George as follows:        
Actual funeral expenses (defrayed by relatives) ₱100,000.00   ₱0.00  
Judicial expenses (extra judicial settlement) ₱300,000.00   ₱0.00  
Loss of certain tangible personal properties ₱250,000.00   ₱250,000.00  
Claims against the estate ₱100,000.00   ₱100,000.00  
Unpaid taxes, accrued after death ₱150,000.00   ₱0.00  
Claims against insolvent person ₱100,000.00   ₱100,000.00  
Unpaid Mortgage ₱200,000.00   ₱200,000.00  
Total LITE     ₱650,000.00  
Allowed LITE PRO RATED (P6,300.000/P11,000,000) P650,000       ₱368,918.92
Transfer for public use ₱100,000.00     ₱100,000.00
Medical expenses ₱100,000.00      
Vanishing Deductions       ₱740,454.74
Total Ordinary Deduction       ₱1,209,373.66
Standard Deduction       ₱500,000.00
Taxable Net Estate       ₱4,590,626.34
        6%
Tax Due       ₱275,437.58
George James is non-resident Chinese citizen. He died testate and left the following properties:   With in With out Total
Car, Philippines (Received as donation 2 years before his death, FMV, date of donation
P1,500,000) ₱1,000,000.00 ₱1,000,000.00   ₱1,000,000.00
Car, Shanghai, China ₱900,000.00   ₱900,000.00 ₱900,000.00
Bonds, Philippines ₱1,000,000.00 ₱1,000,000.00   ₱1,000,000.00
Shares of stock, Shanghai, China ₱600,000.00   ₱600,000.00 ₱600,000.00
House and lot, China (Mortgaged for P200,000) ₱1,800,000.00   ₱1,800,000.00 ₱1,800,000.00
Cash deposit, BDO-Sampaloc, Manila ₱1,200,000.00 ₱1,200,000.00   ₱1,200,000.00
Other tangible personal properties, Manila ₱500,000.00 ₱500,000.00   ₱500,000.00
Franchise, exercised in the Philippines ₱2,500,000.00 ₱2,500,000.00   ₱2,500,000.00
Shares of stock issued by a foreign corporation ₱1,500,000.00   ₱1,500,000.00 ₱1,500,000.00
Claims Against Insolvent peron   ₱100,000.00    
Gross Estate   ₱6,300,000.00 ₱4,800,000.00 ₱11,100,000.00
His cousin, Lebron James was assigned as the executor of his last will and testament. Lebron
sought your advice and presented to you the list of
expenses and deductions relating to the estate of George as follows:        
Actual funeral expenses (defrayed by relatives) ₱100,000.00   ₱0.00  
Judicial expenses (extra judicial settlement) ₱300,000.00   ₱0.00  
Loss of certain tangible personal properties ₱250,000.00   ₱250,000.00  
Claims against the estate ₱100,000.00   ₱100,000.00  
Unpaid taxes, accrued after death ₱150,000.00   ₱0.00  
Claims against insolvent person ₱100,000.00   ₱100,000.00  
Unpaid Mortgage ₱200,000.00   ₱200,000.00  
Total LITE     ₱650,000.00  
Allowed LITE PRO RATED (P6,300.000/P11,000,000) P650,000       ₱368,918.92
Transfer for public use ₱100,000.00     ₱100,000.00
Medical expenses ₱100,000.00      
Vanishing Deductions       ₱740,454.74
Total Ordinary Deduction       ₱1,209,373.66
Standard Deduction       ₱500,000.00
Taxable Net Estate       ₱4,590,626.34
        6%
Tax Due       ₱275,437.58
George James is non-resident Chinese citizen. He died testate and left the following properties:   With in With out Total
Car, Philippines (Received as donation 2 years before his death, FMV, date of donation
P1,500,000) ₱1,000,000.00 ₱1,000,000.00   ₱1,000,000.00
Car, Shanghai, China ₱900,000.00   ₱900,000.00 ₱900,000.00
Bonds, Philippines ₱1,000,000.00 ₱1,000,000.00   ₱1,000,000.00
Shares of stock, Shanghai, China ₱600,000.00   ₱600,000.00 ₱600,000.00
House and lot, China (Mortgaged for P200,000) ₱1,800,000.00   ₱1,800,000.00 ₱1,800,000.00
Cash deposit, BDO-Sampaloc, Manila ₱1,200,000.00 ₱1,200,000.00   ₱1,200,000.00
Other tangible personal properties, Manila ₱500,000.00 ₱500,000.00   ₱500,000.00
Franchise, exercised in the Philippines ₱2,500,000.00 ₱2,500,000.00   ₱2,500,000.00
Shares of stock issued by a foreign corporation ₱1,500,000.00   ₱1,500,000.00 ₱1,500,000.00
Claims Against Insolvent peron   ₱100,000.00    
Gross Estate   ₱6,300,000.00 ₱4,800,000.00 ₱11,100,000.00
His cousin, Lebron James was assigned as the executor of his last will and testament. Lebron
sought your advice and presented to you the list of
expenses and deductions relating to the estate of George as follows:        
Actual funeral expenses (defrayed by relatives) ₱100,000.00   ₱0.00  
Judicial expenses (extra judicial settlement) ₱300,000.00   ₱0.00  
Loss of certain tangible personal properties ₱250,000.00   ₱250,000.00  
Claims against the estate ₱100,000.00   ₱100,000.00  
Unpaid taxes, accrued after death ₱150,000.00   ₱0.00  
Claims against insolvent person ₱100,000.00   ₱100,000.00  
Unpaid Mortgage ₱200,000.00   ₱200,000.00  
Total LITE     ₱650,000.00  
Allowed LITE PRO RATED (P6,300.000/P11,000,000) P650,000       ₱368,918.92
Transfer for public use ₱100,000.00     ₱100,000.00
Medical expenses ₱100,000.00      
Vanishing Deductions       ₱740,454.74
Total Ordinary Deduction       ₱1,209,373.66
Standard Deduction       ₱500,000.00
Taxable Net Estate       ₱4,590,626.34
        6%
Tax Due       ₱275,437.58
George James is non-resident Chinese citizen. He died testate and left the following properties:   With in With out Total
Car, Philippines (Received as donation 2 years before his death, FMV, date of donation
P1,500,000) ₱1,000,000.00 ₱1,000,000.00   ₱1,000,000.00
Car, Shanghai, China ₱900,000.00   ₱900,000.00 ₱900,000.00
Bonds, Philippines ₱1,000,000.00 ₱1,000,000.00   ₱1,000,000.00
Shares of stock, Shanghai, China ₱600,000.00   ₱600,000.00 ₱600,000.00
House and lot, China (Mortgaged for P200,000) ₱1,800,000.00   ₱1,800,000.00 ₱1,800,000.00
Cash deposit, BDO-Sampaloc, Manila ₱1,200,000.00 ₱1,200,000.00   ₱1,200,000.00
Other tangible personal properties, Manila ₱500,000.00 ₱500,000.00   ₱500,000.00
Franchise, exercised in the Philippines ₱2,500,000.00 ₱2,500,000.00   ₱2,500,000.00
Shares of stock issued by a foreign corporation ₱1,500,000.00   ₱1,500,000.00 ₱1,500,000.00
Claims Against Insolvent peron   ₱100,000.00    
Gross Estate   ₱6,300,000.00 ₱4,800,000.00 ₱11,100,000.00
His cousin, Lebron James was assigned as the executor of his last will and testament. Lebron
sought your advice and presented to you the list of
expenses and deductions relating to the estate of George as follows:        
Actual funeral expenses (defrayed by relatives) ₱100,000.00   ₱0.00  
Judicial expenses (extra judicial settlement) ₱300,000.00   ₱0.00  
Loss of certain tangible personal properties ₱250,000.00   ₱250,000.00  
Claims against the estate ₱100,000.00   ₱100,000.00  
Unpaid taxes, accrued after death ₱150,000.00   ₱0.00  
Claims against insolvent person ₱100,000.00   ₱100,000.00  
Unpaid Mortgage ₱200,000.00   ₱200,000.00  
Total LITE     ₱650,000.00  
Allowed LITE PRO RATED (P6,300.000/P11,000,000) P650,000       ₱368,918.92
Transfer for public use ₱100,000.00     ₱100,000.00
Medical expenses ₱100,000.00      
Vanishing Deductions       ₱740,454.74
Total Ordinary Deduction       ₱1,209,373.66
Standard Deduction       ₱500,000.00
Taxable Net Estate       ₱4,590,626.34
        6%
Tax Due       ₱275,437.58
George James is non-resident Chinese citizen. He died testate and left the following properties:   With in With out Total
Car, Philippines (Received as donation 2 years before his death, FMV, date of donation
P1,500,000) ₱1,000,000.00 ₱1,000,000.00   ₱1,000,000.00
Car, Shanghai, China ₱900,000.00   ₱900,000.00 ₱900,000.00
Bonds, Philippines ₱1,000,000.00 ₱1,000,000.00   ₱1,000,000.00
Shares of stock, Shanghai, China ₱600,000.00   ₱600,000.00 ₱600,000.00
House and lot, China (Mortgaged for P200,000) ₱1,800,000.00   ₱1,800,000.00 ₱1,800,000.00
Cash deposit, BDO-Sampaloc, Manila ₱1,200,000.00 ₱1,200,000.00   ₱1,200,000.00
Other tangible personal properties, Manila ₱500,000.00 ₱500,000.00   ₱500,000.00
Franchise, exercised in the Philippines ₱2,500,000.00 ₱2,500,000.00   ₱2,500,000.00
Shares of stock issued by a foreign corporation ₱1,500,000.00   ₱1,500,000.00 ₱1,500,000.00
Claims Against Insolvent peron   ₱100,000.00    
Gross Estate   ₱6,300,000.00 ₱4,800,000.00 ₱11,100,000.00
His cousin, Lebron James was assigned as the executor of his last will and testament. Lebron
sought your advice and presented to you the list of
expenses and deductions relating to the estate of George as follows:        
Actual funeral expenses (defrayed by relatives) ₱100,000.00   ₱0.00  
Judicial expenses (extra judicial settlement) ₱300,000.00   ₱0.00  
Loss of certain tangible personal properties ₱250,000.00   ₱250,000.00  
Claims against the estate ₱100,000.00   ₱100,000.00  
Unpaid taxes, accrued after death ₱150,000.00   ₱0.00  
Claims against insolvent person ₱100,000.00   ₱100,000.00  
Unpaid Mortgage ₱200,000.00   ₱200,000.00  
Total LITE     ₱650,000.00  
Allowed LITE PRO RATED (P6,300.000/P11,000,000) P650,000       ₱368,918.92
Transfer for public use ₱100,000.00     ₱100,000.00
Medical expenses ₱100,000.00      
Vanishing Deductions       ₱740,454.74
Total Ordinary Deduction       ₱1,209,373.66
Standard Deduction       ₱500,000.00
Taxable Net Estate       ₱4,590,626.34
        6%
Tax Due       ₱275,437.58
George James is non-resident Chinese citizen. He died testate and left the following properties:   With in With out Total
Car, Philippines (Received as donation 2 years before his death, FMV, date of donation
P1,500,000) ₱1,000,000.00 ₱1,000,000.00   ₱1,000,000.00
Car, Shanghai, China ₱900,000.00   ₱900,000.00 ₱900,000.00
Bonds, Philippines ₱1,000,000.00 ₱1,000,000.00   ₱1,000,000.00
Shares of stock, Shanghai, China ₱600,000.00   ₱600,000.00 ₱600,000.00
House and lot, China (Mortgaged for P200,000) ₱1,800,000.00   ₱1,800,000.00 ₱1,800,000.00
Cash deposit, BDO-Sampaloc, Manila ₱1,200,000.00 ₱1,200,000.00   ₱1,200,000.00
Other tangible personal properties, Manila ₱500,000.00 ₱500,000.00   ₱500,000.00
Franchise, exercised in the Philippines ₱2,500,000.00 ₱2,500,000.00   ₱2,500,000.00
Shares of stock issued by a foreign corporation ₱1,500,000.00   ₱1,500,000.00 ₱1,500,000.00
Claims Against Insolvent peron   ₱100,000.00    
Gross Estate   ₱6,300,000.00 ₱4,800,000.00 ₱11,100,000.00
His cousin, Lebron James was assigned as the executor of his last will and testament. Lebron
sought your advice and presented to you the list of
expenses and deductions relating to the estate of George as follows:        
Actual funeral expenses (defrayed by relatives) ₱100,000.00   ₱0.00  
Judicial expenses (extra judicial settlement) ₱300,000.00   ₱0.00  
Loss of certain tangible personal properties ₱250,000.00   ₱250,000.00  
Claims against the estate ₱100,000.00   ₱100,000.00  
Unpaid taxes, accrued after death ₱150,000.00   ₱0.00  
Claims against insolvent person ₱100,000.00   ₱100,000.00  
Unpaid Mortgage ₱200,000.00   ₱200,000.00  
Total LITE     ₱650,000.00  
Allowed LITE PRO RATED (P6,300.000/P11,000,000) P650,000       ₱368,918.92
Transfer for public use ₱100,000.00     ₱100,000.00
Medical expenses ₱100,000.00      
Vanishing Deductions       ₱740,454.74
Total Ordinary Deduction       ₱1,209,373.66
Standard Deduction       ₱500,000.00
Taxable Net Estate       ₱4,590,626.34
        6%
Tax Due       ₱275,437.58
George James is non-resident Chinese citizen. He died testate and left the following properties:   With in With out Total
Car, Philippines (Received as donation 2 years before his death, FMV, date of donation
P1,500,000) ₱1,000,000.00 ₱1,000,000.00   ₱1,000,000.00
Car, Shanghai, China ₱900,000.00   ₱900,000.00 ₱900,000.00
Bonds, Philippines ₱1,000,000.00 ₱1,000,000.00   ₱1,000,000.00
Shares of stock, Shanghai, China ₱600,000.00   ₱600,000.00 ₱600,000.00
House and lot, China (Mortgaged for P200,000) ₱1,800,000.00   ₱1,800,000.00 ₱1,800,000.00
Cash deposit, BDO-Sampaloc, Manila ₱1,200,000.00 ₱1,200,000.00   ₱1,200,000.00
Other tangible personal properties, Manila ₱500,000.00 ₱500,000.00   ₱500,000.00
Franchise, exercised in the Philippines ₱2,500,000.00 ₱2,500,000.00   ₱2,500,000.00
Shares of stock issued by a foreign corporation ₱1,500,000.00   ₱1,500,000.00 ₱1,500,000.00
Claims Against Insolvent peron   ₱100,000.00    
Gross Estate   ₱6,300,000.00 ₱4,800,000.00 ₱11,100,000.00
His cousin, Lebron James was assigned as the executor of his last will and testament. Lebron
sought your advice and presented to you the list of
expenses and deductions relating to the estate of George as follows:        
Actual funeral expenses (defrayed by relatives) ₱100,000.00   ₱0.00  
Judicial expenses (extra judicial settlement) ₱300,000.00   ₱0.00  
Loss of certain tangible personal properties ₱250,000.00   ₱250,000.00  
Claims against the estate ₱100,000.00   ₱100,000.00  
Unpaid taxes, accrued after death ₱150,000.00   ₱0.00  
Claims against insolvent person ₱100,000.00   ₱100,000.00  
Unpaid Mortgage ₱200,000.00   ₱200,000.00  
Total LITE     ₱650,000.00  
Allowed LITE PRO RATED (P6,300.000/P11,000,000) P650,000       ₱368,918.92
Transfer for public use ₱100,000.00     ₱100,000.00
Medical expenses ₱100,000.00      
Vanishing Deductions       ₱740,454.74
Total Ordinary Deduction       ₱1,209,373.66
Standard Deduction       ₱500,000.00
Taxable Net Estate       ₱4,590,626.34
        6%
Tax Due       ₱275,437.58
George James is non-resident Chinese citizen. He died testate and left the following properties:   With in With out Total
Car, Philippines (Received as donation 2 years before his death, FMV, date of donation
P1,500,000) ₱1,000,000.00 ₱1,000,000.00   ₱1,000,000.00
Car, Shanghai, China ₱900,000.00   ₱900,000.00 ₱900,000.00
Bonds, Philippines ₱1,000,000.00 ₱1,000,000.00   ₱1,000,000.00
Shares of stock, Shanghai, China ₱600,000.00   ₱600,000.00 ₱600,000.00
House and lot, China (Mortgaged for P200,000) ₱1,800,000.00   ₱1,800,000.00 ₱1,800,000.00
Cash deposit, BDO-Sampaloc, Manila ₱1,200,000.00 ₱1,200,000.00   ₱1,200,000.00
Other tangible personal properties, Manila ₱500,000.00 ₱500,000.00   ₱500,000.00
Franchise, exercised in the Philippines ₱2,500,000.00 ₱2,500,000.00   ₱2,500,000.00
Shares of stock issued by a foreign corporation ₱1,500,000.00   ₱1,500,000.00 ₱1,500,000.00
Claims Against Insolvent peron   ₱100,000.00    
Gross Estate   ₱6,300,000.00 ₱4,800,000.00 ₱11,100,000.00
His cousin, Lebron James was assigned as the executor of his last will and testament. Lebron
sought your advice and presented to you the list of
expenses and deductions relating to the estate of George as follows:        
Actual funeral expenses (defrayed by relatives) ₱100,000.00   ₱0.00  
Judicial expenses (extra judicial settlement) ₱300,000.00   ₱0.00  
Loss of certain tangible personal properties ₱250,000.00   ₱250,000.00  
Claims against the estate ₱100,000.00   ₱100,000.00  
Unpaid taxes, accrued after death ₱150,000.00   ₱0.00  
Claims against insolvent person ₱100,000.00   ₱100,000.00  
Unpaid Mortgage ₱200,000.00   ₱200,000.00  
Total LITE     ₱650,000.00  
Allowed LITE PRO RATED (P6,300.000/P11,000,000) P650,000       ₱368,918.92
Transfer for public use ₱100,000.00     ₱100,000.00
Medical expenses ₱100,000.00      
Vanishing Deductions       ₱740,454.74
Total Ordinary Deduction       ₱1,209,373.66
Standard Deduction       ₱500,000.00
Taxable Net Estate       ₱4,590,626.34
        6%
Tax Due       ₱275,437.58
George James is non-resident Chinese citizen. He died testate and left the following properties:   With in With out Total
Car, Philippines (Received as donation 2 years before his death, FMV, date of donation
P1,500,000) ₱1,000,000.00 ₱1,000,000.00   ₱1,000,000.00
Car, Shanghai, China ₱900,000.00   ₱900,000.00 ₱900,000.00
Bonds, Philippines ₱1,000,000.00 ₱1,000,000.00   ₱1,000,000.00
Shares of stock, Shanghai, China ₱600,000.00   ₱600,000.00 ₱600,000.00
House and lot, China (Mortgaged for P200,000) ₱1,800,000.00   ₱1,800,000.00 ₱1,800,000.00
Cash deposit, BDO-Sampaloc, Manila ₱1,200,000.00 ₱1,200,000.00   ₱1,200,000.00
Other tangible personal properties, Manila ₱500,000.00 ₱500,000.00   ₱500,000.00
Franchise, exercised in the Philippines ₱2,500,000.00 ₱2,500,000.00   ₱2,500,000.00
Shares of stock issued by a foreign corporation ₱1,500,000.00   ₱1,500,000.00 ₱1,500,000.00
Claims Against Insolvent peron   ₱100,000.00    
Gross Estate   ₱6,300,000.00 ₱4,800,000.00 ₱11,100,000.00
His cousin, Lebron James was assigned as the executor of his last will and testament. Lebron
sought your advice and presented to you the list of
expenses and deductions relating to the estate of George as follows:        
Actual funeral expenses (defrayed by relatives) ₱100,000.00   ₱0.00  
Judicial expenses (extra judicial settlement) ₱300,000.00   ₱0.00  
Loss of certain tangible personal properties ₱250,000.00   ₱250,000.00  
Claims against the estate ₱100,000.00   ₱100,000.00  
Unpaid taxes, accrued after death ₱150,000.00   ₱0.00  
Claims against insolvent person ₱100,000.00   ₱100,000.00  
Unpaid Mortgage ₱200,000.00   ₱200,000.00  
Total LITE     ₱650,000.00  
Allowed LITE PRO RATED (P6,300.000/P11,000,000) P650,000       ₱368,918.92
Transfer for public use ₱100,000.00     ₱100,000.00
Medical expenses ₱100,000.00      
Vanishing Deductions       ₱740,454.74
Total Ordinary Deduction       ₱1,209,373.66
Standard Deduction       ₱500,000.00
Taxable Net Estate       ₱4,590,626.34
        6%
Tax Due       ₱275,437.58
George James is non-resident Chinese citizen. He died testate and left the following properties:   With in With out Total
Car, Philippines (Received as donation 2 years before his death, FMV, date of donation
P1,500,000) ₱1,000,000.00 ₱1,000,000.00   ₱1,000,000.00
Car, Shanghai, China ₱900,000.00   ₱900,000.00 ₱900,000.00
Bonds, Philippines ₱1,000,000.00 ₱1,000,000.00   ₱1,000,000.00
Shares of stock, Shanghai, China ₱600,000.00   ₱600,000.00 ₱600,000.00
House and lot, China (Mortgaged for P200,000) ₱1,800,000.00   ₱1,800,000.00 ₱1,800,000.00
Cash deposit, BDO-Sampaloc, Manila ₱1,200,000.00 ₱1,200,000.00   ₱1,200,000.00
Other tangible personal properties, Manila ₱500,000.00 ₱500,000.00   ₱500,000.00
Franchise, exercised in the Philippines ₱2,500,000.00 ₱2,500,000.00   ₱2,500,000.00
Shares of stock issued by a foreign corporation ₱1,500,000.00   ₱1,500,000.00 ₱1,500,000.00
Claims Against Insolvent peron   ₱100,000.00    
Gross Estate   ₱6,300,000.00 ₱4,800,000.00 ₱11,100,000.00
His cousin, Lebron James was assigned as the executor of his last will and testament. Lebron
sought your advice and presented to you the list of
expenses and deductions relating to the estate of George as follows:        
Actual funeral expenses (defrayed by relatives) ₱100,000.00   ₱0.00  
Judicial expenses (extra judicial settlement) ₱300,000.00   ₱0.00  
Loss of certain tangible personal properties ₱250,000.00   ₱250,000.00  
Claims against the estate ₱100,000.00   ₱100,000.00  
Unpaid taxes, accrued after death ₱150,000.00   ₱0.00  
Claims against insolvent person ₱100,000.00   ₱100,000.00  
Unpaid Mortgage ₱200,000.00   ₱200,000.00  
Total LITE     ₱650,000.00  
Allowed LITE PRO RATED (P6,300.000/P11,000,000) P650,000       ₱368,918.92
Transfer for public use ₱100,000.00     ₱100,000.00
Medical expenses ₱100,000.00      
Vanishing Deductions       ₱740,454.74
Total Ordinary Deduction       ₱1,209,373.66
Standard Deduction       ₱500,000.00
Taxable Net Estate       ₱4,590,626.34
        6%
Tax Due       ₱275,437.58
George James is non-resident Chinese citizen. He died testate and left the following properties:   With in With out Total
Car, Philippines (Received as donation 2 years before his death, FMV, date of donation
P1,500,000) ₱1,000,000.00 ₱1,000,000.00   ₱1,000,000.00
Car, Shanghai, China ₱900,000.00   ₱900,000.00 ₱900,000.00
Bonds, Philippines ₱1,000,000.00 ₱1,000,000.00   ₱1,000,000.00
Shares of stock, Shanghai, China ₱600,000.00   ₱600,000.00 ₱600,000.00
House and lot, China (Mortgaged for P200,000) ₱1,800,000.00   ₱1,800,000.00 ₱1,800,000.00
Cash deposit, BDO-Sampaloc, Manila ₱1,200,000.00 ₱1,200,000.00   ₱1,200,000.00
Other tangible personal properties, Manila ₱500,000.00 ₱500,000.00   ₱500,000.00
Franchise, exercised in the Philippines ₱2,500,000.00 ₱2,500,000.00   ₱2,500,000.00
Shares of stock issued by a foreign corporation ₱1,500,000.00   ₱1,500,000.00 ₱1,500,000.00
Claims Against Insolvent peron   ₱100,000.00    
Gross Estate   ₱6,300,000.00 ₱4,800,000.00 ₱11,100,000.00
His cousin, Lebron James was assigned as the executor of his last will and testament. Lebron
sought your advice and presented to you the list of
expenses and deductions relating to the estate of George as follows:        
Actual funeral expenses (defrayed by relatives) ₱100,000.00   ₱0.00  
Judicial expenses (extra judicial settlement) ₱300,000.00   ₱0.00  
Loss of certain tangible personal properties ₱250,000.00   ₱250,000.00  
Claims against the estate ₱100,000.00   ₱100,000.00  
Unpaid taxes, accrued after death ₱150,000.00   ₱0.00  
Claims against insolvent person ₱100,000.00   ₱100,000.00  
Unpaid Mortgage ₱200,000.00   ₱200,000.00  
Total LITE     ₱650,000.00  
Allowed LITE PRO RATED (P6,300.000/P11,000,000) P650,000       ₱368,918.92
Transfer for public use ₱100,000.00     ₱100,000.00
Medical expenses ₱100,000.00      
Vanishing Deductions       ₱740,454.74
Total Ordinary Deduction       ₱1,209,373.66
Standard Deduction       ₱500,000.00
Taxable Net Estate       ₱4,590,626.34
        6%
Tax Due       ₱275,437.58
George James is non-resident Chinese citizen. He died testate and left the following properties:   With in With out Total
Car, Philippines (Received as donation 2 years before his death, FMV, date of donation
P1,500,000) ₱1,000,000.00 ₱1,000,000.00   ₱1,000,000.00
Car, Shanghai, China ₱900,000.00   ₱900,000.00 ₱900,000.00
Bonds, Philippines ₱1,000,000.00 ₱1,000,000.00   ₱1,000,000.00
Shares of stock, Shanghai, China ₱600,000.00   ₱600,000.00 ₱600,000.00
House and lot, China (Mortgaged for P200,000) ₱1,800,000.00   ₱1,800,000.00 ₱1,800,000.00
Cash deposit, BDO-Sampaloc, Manila ₱1,200,000.00 ₱1,200,000.00   ₱1,200,000.00
Other tangible personal properties, Manila ₱500,000.00 ₱500,000.00   ₱500,000.00
Franchise, exercised in the Philippines ₱2,500,000.00 ₱2,500,000.00   ₱2,500,000.00
Shares of stock issued by a foreign corporation ₱1,500,000.00   ₱1,500,000.00 ₱1,500,000.00
Claims Against Insolvent peron   ₱100,000.00    
Gross Estate   ₱6,300,000.00 ₱4,800,000.00 ₱11,100,000.00
His cousin, Lebron James was assigned as the executor of his last will and testament. Lebron
sought your advice and presented to you the list of
expenses and deductions relating to the estate of George as follows:        
Actual funeral expenses (defrayed by relatives) ₱100,000.00   ₱0.00  
Judicial expenses (extra judicial settlement) ₱300,000.00   ₱0.00  
Loss of certain tangible personal properties ₱250,000.00   ₱250,000.00  
Claims against the estate ₱100,000.00   ₱100,000.00  
Unpaid taxes, accrued after death ₱150,000.00   ₱0.00  
Claims against insolvent person ₱100,000.00   ₱100,000.00  
Unpaid Mortgage ₱200,000.00   ₱200,000.00  
Total LITE     ₱650,000.00  
Allowed LITE PRO RATED (P6,300.000/P11,000,000) P650,000       ₱368,918.92
Transfer for public use ₱100,000.00     ₱100,000.00
Medical expenses ₱100,000.00      
Vanishing Deductions       ₱740,454.74
Total Ordinary Deduction       ₱1,209,373.66
Standard Deduction       ₱500,000.00
Taxable Net Estate       ₱4,590,626.34
        6%
Tax Due       ₱275,437.58
Rates of vanishing deduction – If the present decedent died within the
following period    
after the date of prior decedent’s death or after the date of donation:    
0 1 Year 100%
> 1 Year 2 Years 80%
> 2 Years 3 Year 60%
> 3 Years 4 Years 40%
> 4 Years 5 Years 20%
> 5 Years   0%

Format of Computation    
₱1,000,000.0
FMV of Inherited property at the time of death 0  
FMV of Gross estate other than Inherited property  
₱6,300,000.0
Total Gross Estate of the present Decedent PH 0  
LITE and property transferred for public used ₱468,918.92  
Value to take   ₱1,000,000.00
Less Mortgaged paid by the current decedent   ₱0.00
Initial basis   ₱1,000,000.00
(P1,000,000/
Less: Proportional Deductions(LITE and property transferred for public used) P6,300,000) *
(Initial basis / Gross estate) x (LITE plus TPU) P300,000 -₱74,431.57
Final Basis   ₱925,568.43
Multiply by Rate of Vanishing Deduction   80%
Vanishing Deduction   ₱740,454.74
George James is non-resident Chinese citizen. He died testate and left the following properties:   With in With out Total
Car, Philippines (Received as donation 2 years before his death, FMV, date of donation
P1,500,000) ₱1,000,000.00 ₱1,000,000.00   ₱1,000,000.00
Car, Shanghai, China ₱900,000.00   ₱900,000.00 ₱900,000.00
Bonds, Philippines ₱1,000,000.00 ₱1,000,000.00   ₱1,000,000.00
Shares of stock, Shanghai, China ₱600,000.00   ₱600,000.00 ₱600,000.00
House and lot, China (Mortgaged for P200,000) ₱1,800,000.00   ₱1,800,000.00 ₱1,800,000.00
Cash deposit, BDO-Sampaloc, Manila ₱1,200,000.00 ₱1,200,000.00   ₱1,200,000.00
Other tangible personal properties, Manila ₱500,000.00 ₱500,000.00   ₱500,000.00
Franchise, exercised in the Philippines ₱2,500,000.00 ₱2,500,000.00   ₱2,500,000.00
Shares of stock issued by a foreign corporation ₱1,500,000.00   ₱1,500,000.00 ₱1,500,000.00
Claims Against Insolvent peron   ₱100,000.00    
Gross Estate   ₱6,300,000.00 ₱4,800,000.00 ₱11,100,000.00
His cousin, Lebron James was assigned as the executor of his last will and testament. Lebron
sought your advice and presented to you the list of
expenses and deductions relating to the estate of George as follows:        
Actual funeral expenses (defrayed by relatives) ₱100,000.00   ₱0.00  
Judicial expenses (extra judicial settlement) ₱300,000.00   ₱0.00  
Loss of certain tangible personal properties ₱250,000.00   ₱250,000.00  
Claims against the estate ₱100,000.00   ₱100,000.00  
Unpaid taxes, accrued after death ₱150,000.00   ₱0.00  
Claims against insolvent person ₱100,000.00   ₱100,000.00  
Unpaid Mortgage ₱200,000.00   ₱200,000.00  
Total LITE     ₱650,000.00  
Allowed LITE PRO RATED (P6,300.000/P11,000,000) P650,000       ₱368,918.92
Transfer for public use ₱100,000.00     ₱100,000.00
Medical expenses ₱100,000.00      
Vanishing Deductions       ₱740,454.74
Total Ordinary Deduction       ₱1,209,373.66
Standard Deduction       ₱500,000.00
Taxable Net Estate       ₱4,590,626.34
        6%
Tax Due       ₱275,437.58
George James is non-resident Chinese citizen. He died testate and left the following properties:   With in With out Total
Car, Philippines (Received as donation 2 years before his death, FMV, date of donation
P1,500,000) ₱1,000,000.00 ₱1,000,000.00   ₱1,000,000.00
Car, Shanghai, China ₱900,000.00   ₱900,000.00 ₱900,000.00
Bonds, Philippines ₱1,000,000.00 ₱1,000,000.00   ₱1,000,000.00
Shares of stock, Shanghai, China ₱600,000.00   ₱600,000.00 ₱600,000.00
House and lot, China (Mortgaged for P200,000) ₱1,800,000.00   ₱1,800,000.00 ₱1,800,000.00
Cash deposit, BDO-Sampaloc, Manila ₱1,200,000.00 ₱1,200,000.00   ₱1,200,000.00
Other tangible personal properties, Manila ₱500,000.00 ₱500,000.00   ₱500,000.00
Franchise, exercised in the Philippines ₱2,500,000.00 ₱2,500,000.00   ₱2,500,000.00
Shares of stock issued by a foreign corporation ₱1,500,000.00   ₱1,500,000.00 ₱1,500,000.00
Claims Against Insolvent peron   ₱100,000.00    
Gross Estate   ₱6,300,000.00 ₱4,800,000.00 ₱11,100,000.00
His cousin, Lebron James was assigned as the executor of his last will and testament. Lebron
sought your advice and presented to you the list of
expenses and deductions relating to the estate of George as follows:        
Actual funeral expenses (defrayed by relatives) ₱100,000.00   ₱0.00  
Judicial expenses (extra judicial settlement) ₱300,000.00   ₱0.00  
Loss of certain tangible personal properties ₱250,000.00   ₱250,000.00  
Claims against the estate ₱100,000.00   ₱100,000.00  
Unpaid taxes, accrued after death ₱150,000.00   ₱0.00  
Claims against insolvent person ₱100,000.00   ₱100,000.00  
Unpaid Mortgage ₱200,000.00   ₱200,000.00  
Total LITE     ₱650,000.00  
Allowed LITE PRO RATED (P6,300.000/P11,000,000) P650,000       ₱368,918.92
Transfer for public use ₱100,000.00     ₱100,000.00
Medical expenses ₱100,000.00      
Vanishing Deductions       ₱740,454.74
Total Ordinary Deduction       ₱1,209,373.66
Standard Deduction       ₱500,000.00
Taxable Net Estate       ₱4,590,626.34
        6%
Tax Due       ₱275,437.58
George James is non-resident Chinese citizen. He died testate and left the following properties:   With in With out Total
Car, Philippines (Received as donation 2 years before his death, FMV, date of donation
P1,500,000) ₱1,000,000.00 ₱1,000,000.00   ₱1,000,000.00
Car, Shanghai, China ₱900,000.00   ₱900,000.00 ₱900,000.00
Bonds, Philippines ₱1,000,000.00 ₱1,000,000.00   ₱1,000,000.00
Shares of stock, Shanghai, China ₱600,000.00   ₱600,000.00 ₱600,000.00
House and lot, China (Mortgaged for P200,000) ₱1,800,000.00   ₱1,800,000.00 ₱1,800,000.00
Cash deposit, BDO-Sampaloc, Manila ₱1,200,000.00 ₱1,200,000.00   ₱1,200,000.00
Other tangible personal properties, Manila ₱500,000.00 ₱500,000.00   ₱500,000.00
Franchise, exercised in the Philippines ₱2,500,000.00 ₱2,500,000.00   ₱2,500,000.00
Shares of stock issued by a foreign corporation ₱1,500,000.00   ₱1,500,000.00 ₱1,500,000.00
Claims Against Insolvent peron   ₱100,000.00    
Gross Estate   ₱6,300,000.00 ₱4,800,000.00 ₱11,100,000.00
His cousin, Lebron James was assigned as the executor of his last will and testament. Lebron
sought your advice and presented to you the list of
expenses and deductions relating to the estate of George as follows:        
Actual funeral expenses (defrayed by relatives) ₱100,000.00   ₱0.00  
Judicial expenses (extra judicial settlement) ₱300,000.00   ₱0.00  
Loss of certain tangible personal properties ₱250,000.00   ₱250,000.00  
Claims against the estate ₱100,000.00   ₱100,000.00  
Unpaid taxes, accrued after death ₱150,000.00   ₱0.00  
Claims against insolvent person ₱100,000.00   ₱100,000.00  
Unpaid Mortgage ₱200,000.00   ₱200,000.00  
Total LITE     ₱650,000.00  
Allowed LITE PRO RATED (P6,300.000/P11,000,000) P650,000       ₱368,918.92
Transfer for public use ₱100,000.00     ₱100,000.00
Medical expenses ₱100,000.00      
Vanishing Deductions       ₱740,454.74
Total Ordinary Deduction       ₱1,209,373.66
Standard Deduction       ₱500,000.00
Taxable Net Estate       ₱4,590,626.34
        6%
Tax Due       ₱275,437.58
George James is non-resident Chinese citizen. He died testate and left the following properties:   With in With out Total
Car, Philippines (Received as donation 2 years before his death, FMV, date of donation
P1,500,000) ₱1,000,000.00 ₱1,000,000.00   ₱1,000,000.00
Car, Shanghai, China ₱900,000.00   ₱900,000.00 ₱900,000.00
Bonds, Philippines ₱1,000,000.00 ₱1,000,000.00   ₱1,000,000.00
Shares of stock, Shanghai, China ₱600,000.00   ₱600,000.00 ₱600,000.00
House and lot, China (Mortgaged for P200,000) ₱1,800,000.00   ₱1,800,000.00 ₱1,800,000.00
Cash deposit, BDO-Sampaloc, Manila ₱1,200,000.00 ₱1,200,000.00   ₱1,200,000.00
Other tangible personal properties, Manila ₱500,000.00 ₱500,000.00   ₱500,000.00
Franchise, exercised in the Philippines ₱2,500,000.00 ₱2,500,000.00   ₱2,500,000.00
Shares of stock issued by a foreign corporation ₱1,500,000.00   ₱1,500,000.00 ₱1,500,000.00
Claims Against Insolvent peron   ₱100,000.00    
Gross Estate   ₱6,300,000.00 ₱4,800,000.00 ₱11,100,000.00
His cousin, Lebron James was assigned as the executor of his last will and testament. Lebron
sought your advice and presented to you the list of
expenses and deductions relating to the estate of George as follows:        
Actual funeral expenses (defrayed by relatives) ₱100,000.00   ₱0.00  
Judicial expenses (extra judicial settlement) ₱300,000.00   ₱0.00  
Loss of certain tangible personal properties ₱250,000.00   ₱250,000.00  
Claims against the estate ₱100,000.00   ₱100,000.00  
Unpaid taxes, accrued after death ₱150,000.00   ₱0.00  
Claims against insolvent person ₱100,000.00   ₱100,000.00  
Unpaid Mortgage ₱200,000.00   ₱200,000.00  
Total LITE     ₱650,000.00  
Allowed LITE PRO RATED (P6,300.000/P11,000,000) P650,000       ₱368,918.92
Transfer for public use ₱100,000.00     ₱100,000.00
Medical expenses ₱100,000.00      
Vanishing Deductions       ₱740,454.74
Total Ordinary Deduction       ₱1,209,373.66
Standard Deduction       ₱500,000.00
Taxable Net Estate       ₱4,590,626.34
        6%
Tax Due       ₱275,437.58
George James isnon-resident Chinese citizen. He died testate and left the following properties:   With in With out Total
Car, Philippines (Received as donation 2 years before his death, FMV, date of donation
P1,500,000) ₱1,000,000.00 ₱1,000,000.00   ₱1,000,000.00
Car, Shanghai, China ₱900,000.00   ₱900,000.00 ₱900,000.00
Bonds, Philippines ₱1,000,000.00 ₱1,000,000.00   ₱1,000,000.00
Shares of stock, Shanghai, China ₱600,000.00   ₱600,000.00 ₱600,000.00
House and lot, China (Mortgaged for P200,000) ₱1,800,000.00   ₱1,800,000.00 ₱1,800,000.00
Cash deposit, BDO-Sampaloc, Manila ₱1,200,000.00 ₱1,200,000.00   ₱1,200,000.00
Other tangible personal properties, Manila ₱500,000.00 ₱500,000.00   ₱500,000.00
Franchise, exercised in the Philippines ₱2,500,000.00 ₱2,500,000.00   ₱2,500,000.00
Shares of stock issued by a foreign corporation ₱1,500,000.00   ₱1,500,000.00 ₱1,500,000.00
Claims Against Insolvent peron   ₱100,000.00    
Gross Estate   ₱6,300,000.00 ₱4,800,000.00 ₱11,100,000.00
His cousin, Lebron James was assigned as the executor of his last will and testament. Lebron
sought your advice and presented to you the list of
expenses and deductions relating to the estate of George as follows:        
Actual funeral expenses (defrayed by relatives) ₱100,000.00   ₱0.00  
Judicial expenses (extra judicial settlement) ₱300,000.00   ₱0.00  
Loss of certain tangible personal properties ₱250,000.00   ₱250,000.00  
Claims against the estate ₱100,000.00   ₱100,000.00  
Unpaid taxes, accrued after death ₱150,000.00   ₱0.00  
Claims against insolvent person ₱100,000.00   ₱100,000.00  
Unpaid Mortgage ₱200,000.00   ₱200,000.00  
Total LITE     ₱650,000.00  
Allowed LITE PRO RATED (P6,300.000/P11,000,000) P650,000       ₱368,918.92
Transfer for public use ₱100,000.00     ₱100,000.00
Medical expenses ₱100,000.00      
Vanishing Deductions       ₱740,454.74
Total Ordinary Deduction       ₱1,209,373.66
Standard Deduction       ₱500,000.00
Taxable Net Estate       ₱4,590,626.34
        6%
Tax Due       ₱275,437.58
Types of heirs
• Compulsory Legitime
• Voluntary
• Legal or intestate
Compulsory heirs

Legitimate children
Spouse
Illegitimate children
Important notes on OLD Donors nd estate tax
threshold of funeral expense is
funeral expense

• threshold of 200000 lang

threshold of funeral expense is

• 200000 lang
• For actual funeral expenses or in an amount equal to five
percent (5%) of the gross estate, whichever is lower, but in no
case to exceed Two hundred thousand pesos (P200,000)
Judicial expense
Medical Expenses.
• Up to 500000 lang
Medical Expenses.
• Medical Expenses incurred by the decedent within one (1)
year prior to his death which shall be duly substantiated with
receipts: Provided, That in no case shall the deductible medical
expenses exceed Five Hundred Thousand Pesos (P500,000).
Standard and Family home
• Parehas 1million lang yan Sa OLD LAW
Both sa OLD LAW and TRAIN LAW
• Ang amount received by heirs under RA 4917 ay
• INCLUDED SA GROSS ESTATE KUNG SINAMA LANG HA SA GROSS
ESTATE
• Amount Received by Heirs Under Republic Act No. 4917. – Any
amount received by the heirs from the decedent – employee as
a consequence of the death of the decedent-employee in
accordance with Republic Act No. 4917: Provided, That
such amount is included in the gross estate of
the decedent.
• HINDI REQUIRED ISAMA YAN SA GROSS ESTATE
Dahil Donated yan

• Kasama sya sa exclusive

properties ng decedent
• Syemre ordinary deductions yan diba kasama
yan sa 7 ordinary sa train law ha
• Tatlo lang kasi yung special
Ang mga ordinary deduction sa train law ay
Ang mga ordinary deduction sa train law ay
• Claims against the estate
Ang mga ordinary deduction sa train law ay
• Claims against the estate
• Claims against insolvent persons
Ang mga ordinary deduction sa train law ay
• Claims against the estate
• Claims against insolvent persons
• Unpaid mortgage payable
Ang mga ordinary deduction sa train law ay
• Claims against the estate
• Claims against insolvent persons
• Unpaid mortgage payable
• Lolo thunder
Ang mga ordinary deduction sa train law ay
• Claims against the estate
• Claims against insolvent persons
• Unpaid mortgage payable
• Joks hehe losses
Ang mga ordinary deduction sa train law ay
• Claims against the estate
• Claims against insolvent persons
• Unpaid mortgage payable
• Joks hehe losses
• Upaid taxes
• Transfer for public use
• Vanishing deductions
Special deductions under train
• Family home
• Standard deductions
• Amounts received by heir under RA 4917