FEU MAKATI

FEU MAKATI
TAXATION M.V.U. SIA
Estate Tax MAY 2020

LECTURE NOTES

INTRODUCTION TO ESTATE TAX C. Elements of Succession

A. Nature of Estate Tax – It is a tax on the right to a. Decedent - the person whose property is
transfer property at death (succession) and on transmitted through succession, whether or not
certain transfers which are made by law the he left a will (Art. 775, CCP).
equivalent of testamentary disposition and is
measured by the value of the property. b. Heir - the person called to the succession either
by the provision of a will or by operation of law
 It is an excise tax, the object of which is the (Art. 782, CCP).
shifting of economic benefits and enjoyment of
property from the dead to the living. c. Estate - refers to all the property, rights and
obligations of a person which are not
 It accrues as of the death of the decedent, extinguished by his death (Art. 776, CCP).
notwithstanding the postponement of the actual
D. Kinds of Succession
possession or enjoyment of the estate by the
beneficiary.
1) Testamentary - succession which results from
the designation of an heir, made in a will
 The taxpayer in the estate taxation is the estate
executed in the form prescribed by law (Art. 779,
of the decedent represented by the administrator,
CCP).
executor or legal heirs.
 While the decedent may dispose of his properties
B. Concept of Succession - is a mode of acquisition by
in a last will and testament, he must, however,
virtue of which the property, rights and obligations to
reserve some for certain persons who are called
the extent of the value of the inheritance, of a person
by law as compulsory or forced heirs.
are transmitted through his death to another or
others either by will or by operation of law (Art.
 Kinds of successors in a testamentary
774, Civil Code of the Philippines).
succession
 Will- an act whereby a person is permitted with
1. Legatee, an heir to a particular personal
the formalities prescribed by law, to control to a
property given by virtue of a will.
certain degree the disposition of his estate, to
take effect after his death (Art. 783, CCP) from
2. Devisee, an heir to a particular real property
the moment of the death of the decedent, the
given by virtue of a will.
rights to the succession are transmitted, and the
possession of the hereditary property is deemed
 Executor is the person nominated by a testator
transmitted to the heir (Art. 777, CCP).
to carry out the directions and request in his will
and to dispose of his property according to his
 Kinds of Wills:
testamentary provisions after his death.
1. Notarial or Ordinary or Attested Will – is one
 Compulsory or Forced Heirs:
which is executed in accordance with the
1. legitimate children and descendants
formalities prescribed by Art. 804 to 808 of
2. In default of the foregoing, legitimate
the New Civil Code. It is a will that is created
parents or ascendants
for the testator by a third party, usually his
3. Widow or widower; and
lawyer, follows proper form, signed and dated
4. Illegitimate children
in front of the required number of witnesses
(3 or more witnesses) and acknowledged by
 Under testamentary succession, the mass of
the presence of a notary public.
properties left by the decedent may be
classified into:
2. Holographic Will–is a written will which must
1. Legitime is the portion of the testator’s
be entirely written, dated and signed by the
property which could not be disposed of
hand of the testator himself, without the
freely because the law has reserved it for the
necessity of any witness. This kind of will
compulsory heirs. (Art. 886, CCP).
does not need formalities because many
people can recognize his handwriting and it
2. Free portion is that part of the whole estate
can be verified by a penmanship expert.
which the testator could dispose of freely
through written will irrespective of his
Codicil – a supplement or addition to a will,
relationship to the recipient.
made after the execution of a will and
annexed to be taken as a part thereof, by
2) Legal or Intestate - transmission of properties
which any disposition made in the original will
where there is no will, or if there is a will, the
is explained, added to or altered.
same is void or lost its validity, or nobody
succeeds in the will.

Page 1 of 17 TAX.01
  In intestate succession, the entire estate of the
decedent is distributed to the heirs. The
compulsory heirs in testamentary succession are E. FORMAT OF COMPUTATION
also heirs in intestate succession. However,
intestate heirs include, brothers and sisters, 1) SINGLE DECEDENT
collateral relatives within the fifth civil degree,
and the state. Gross Estate PXXX
Ordinary Deductions (XXX)
 Administrator is a person appointed by the Special Deductions (XXX)
court, in accordance with the governing statute, Net Taxable Estate PXXX
to administer and settle intestate estate and such
testate estate as no competent executor was Estate Tax Due PXXX
designated by the testator. Less: Tax Credit (XXX)
Estate Tax Payable PXXX
3) Mixed - transmission of properties, which is
effected partly by will and partly by operation of
law.
3.
Exclusive Common Total
Gross Estate PXXX PXXX PXXX
Less: Ordinary Deductions (XXX) (XXX) (XXX)
PXXX PXXX PXXX
Less: Share of Surviving Spouse (Net Common Estate*/2) (XXX)
PXXX
Less: Special Deductions (XXX)
Net Taxable Estate PXXX

Estate Tax Due PXXX

Less: Tax Credit (XXX)
Estate Tax Payable PXXX

Page 2 of 17 TAX.01

GROSS ESTATE
A. Gross Estate Defined – consists of all properties
and interests in properties of the decedent at the
time of his death as well as properties transferred
during lifetime (only in form), but in substance was
only transferred at the time death.
B. Classification of Decedent
1) Citizen or Resident (RC/NRC/RA)
2) Non-resident Alien (NRA)
i. With reciprocity
ii. Without reciprocity
C. Reciprocity Clause – No tax shall be imposed with
respect to intangible personal properties of a
NRA situated in the Philippines:
1) When the foreign country, where such NRA is a
resident and citizen, does not impose transfer
tax with respect to intangible personal
properties of Filipino citizens not residing in that
country; or
2) When the foreign country imposes transfer
taxes, but grants similar exemption with respect
to intangible personal properties of Filipino
citizens not residing in that country.
D. Intangible Properties considered Located in the
Philippines:
1) Franchise which must be exercised in the
Philippines;
2) Shares, obligations or bonds issued by any
corporation or sociedad anonima organized or
constituted in the Philippines;
3) Shares obligations or bonds issued by any
foreign corporation, at least 85% of the business
of which is located in the Philippines;
4) Shares, obligations, or bonds issued by any
foreign corporation if such shares, obligations, or
bonds have acquired a business situs (used in
the furtherance of its business in the Philippines)
in the Philippines;
5) Shares or rights in partnership, business or
industry established in the Philippines.
E. Components of the Gross Estate
1) Properties existing at the time of death such as:
a. Real Property
b. Tangible Personal Property
c. Intangible Personal Property
2) Decedent’s Interest – Refers to the extent of
equity or ownership participation of the decedent
on any property physically existing and present
in the gross estate, whether or not in his
possession, control or dominion. It also refers to
the value of ANY INTEREST IN PROPERTY
OWNED OR POSSESSED by the decedent at the
time of his death (interest having value or
capable of being valued, transferred)
Example:
Page 3 of 11
 Dividends declared before his death but received
after death.
 Partnership profit which have accrued before his
death
 Usufructuary rights, etc.
3) Properties transferred gratuitously during
lifetime, but in substance, transferred upon
death: (CRRIG)
a. Transfer in contemplation of death – the
thought of death must be the impelling cause
of the transfer.
EXCEPTION (NOT IN CONTEMPLATION OF
DEATH):
1. To relieve the donor from the burden of
management.
2. To save income or property taxes.
3. To settle family litigated and un-litigated
disputes.
4. To provide independent income for
dependents.
5. To see the children enjoy the property
while the donor is still alive.
6. To protect the family from the hazards of
business operations.
7. To reward services rendered.
b. Transfer with retention or reservation of
certain right – allows the transferor to
continue enjoying, possessing or controlling
the property (beneficial ownership) because
only the naked title has been transferred.
c. Revocable transfer – decedent transfers the
enjoyment of his property to another, subject
to his right to revoke the transfer at will, with
or without notifying the transferee, any time
before he dies.
d. Property passing under general power of
appointment
e. Transfers for insufficient consideration – sale
of property below fair market value (FMV)
under the cases in letter a to d above.
 Amount included in gross estate:
FMV at the time of death PXXX
Less: Selling Price (XXX)
Included in Gross Estate PXXX
4) Proceeds from life insurance – the following are
included in the gross estate:
a. Whether REVOCABLE or IRREVOCABLE,
when the beneficiary is the :
i. Estate of the deceased
ii. His executor; or
iii. Administrator
b. When the beneficiary is a third person, only if
REVOCABLE.
F. Valuation of Gross Estate – the items comprising
the gross estate shall be valued at the time of death
or date nearest such date.
1) Usufruct – based on latest Basic Mortality Table
to be approved by the Secretary of Finance,
TAX.1702
 upon recommendation of the Insurance
Commissioner.
2) Real Property – the higher amount between:
a. Fair Market Value
b. Zonal Value
3) Personal Properties – Fair market value
4) Shares of stock
a. Traded in the Local Stock Exchange (LSE) –
mean between the highest and lowest
quotations, at a date nearest the date of
death, if none is available at the date of
death itself (RR 2-2003/RR 12-2018).
b. Not traded in the local stock exchange:
i. Common (ordinary) shares – Book
value
ii. Preferred (preference) shares – Par 3) Under Special Laws
Value
c. Units of participation in any association,
recreation or amusement club (such as golf,
polo, or similar clubs) – bid price nearest the
date of death published in any newspaper or
publication of general circulation.
G. Exemptions and Exclusions from Gross Estate
1) Under Section 85 and 86, NIRC
a. Capital or exclusive property of the surviving
spouse
b. Properties outside the Philippines of a non-
resident alien decedent
c. Intangible personal property in the Philippines
of a non-resident alien when the rule of
Reciprocity applies.
2) Under Section 87, NIRC
a. The merger of the usufruct (right to use) in
the owner of the naked title (without right to
use).
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 will of the predecessor.
d. All bequests, devices, legacies or transfers to
social welfare, cultural and charitable
institutions, provided:
 No part of the net income of said
institutions inure to the benefit of any
individual;
 Not more than 30% of such transfers
shall be used for administration
purposes.
a. Proceeds of life insurance and benefits
received by members of the GSIS (RA728).
b. Benefits received by members from the SSS
by reason of death (RA1792).
c. Amounts received from Philippine and United
States governments for war damages.
d. Amounts received from United States
Veterans Administration.
e. Benefits received from the Philippines and US
government for damages suffered during
World War II (RA227).
f. Retirement benefits of officials/employees of a
private firm (RA4917).
g. Payments from the Philippines of US
government to the legal heirs of deceased of
World War II Veterans and deceased civilian
for supplies/services furnished to the US and
Philippine Army (RA136).
h. Personal Equity and Retirement Account
(PERA) asset of the decedent-contributor
(Section 14, RA 9505)

GROSS ESTATE BASED ON CITIZENSHIP & RESIDENCE

Real Property Tangible Personal Intangible Personal

Property Property
Decedent w/in w/out w/in w/out w/in w/out
Citizen or √ √ √ √ √ √
Resident
NRA w/o √ X √ X √ X
reciprocity
NRA w/ √ X √ X X X
reciprocity

 Exclusive Properties:
PROPERTY RELATIONSHIP BETWEEN SPOUSES a. That which is brought to the marriage as his
or her own;
A. COMPONENTS OF GROSS ESTATE OF A
MARRIED DECEDENT b. That which each acquires during marriage by
gratuitous title;

Exclusive Properties of the Decedent PXXX c. That which is acquired by right of

Add: Common Properties (100%) XXX redemption, by barter or by exchange with
Gross Estate PXXX property belonging to any one of the spouses;
and
NOTE: Exclusive properties of the surviving spouse
are excluded in computing gross estate. d. That which is purchased with exclusive
money of the wife or of the husband.
B. PROPERTY RELATIONSHIP BETWEEN SPOUSES
 Conjugal Properties:
1) Conjugal Partnership of Gains (CPOG)

Page 4 of 11 TAX.01
 a. Those acquired by onerous title during marriage
at the expense of the common fund, whether the
2. Absolute Community of Property (ACOP)
acquisition be for the partnership, or for only one
of the spouses;
 Community Properties:
a. All properties owned by the spouses at the
b. Those obtained from labor, industry, work or
time of celebration of the marriage; or
profession of either or both spouses;
b. Acquired thereafter
c. The fruits, natural or industrial, or civil, due or
 Exclusive Properties:
received during marriage from common
a. Property acquired during marriage by gratuitous
property, as well as the net fruits from the
title by spouse, and the fruits as well as the
exclusive property of each spouse;
income thereof.
d. The share of either spouse in the hidden treasure
EXCEPTION: unless it is expressly provided by
which the law awards to the finder or owner of
the donor, testator or grantor that they shall
the property where the treasure is found;
form part of the community property.
e. Those acquired through occupation such as
b. Property for personal and exclusive use of either
fishing or hunting;
spouse.
f. Livestock existing upon dissolution of the
EXCEPTION: jewelry shall form part of the
partnership in excess of the number of each kind
community property.
brought to the marriage by either spouse; and
c. Property acquired before the marriage by either
g. Those acquired by chance, such as winnings
spouse who has legitimate descendants by the
from gambling or betting. However, losses
former marriage, and the fruits as well as the
therefrom shall be borne exclusively by the
income, if any of such property.
loser-spouse.

Page 5 of 11 TAX.01
 C. Similarities between CPOG and ACOP

Property CPOG ACOP

1. Property inherited or received as donation during Exclusive Exclusive
marriage
2. Property acquired during marriage (other than Conjugal Community
inheritance or donation)
3. Property acquired from labor, industry, work or Conjugal Community
profession of spouses
4. Fruits or income due or derived during the Conjugal Community
marriage coming from common property

D. Difference between CPOG and ACOP

Property CPOG ACOP

1. Property before marriage or brought to the Exclusive Community
marriage
2. Fruits or income due or derived during the Conjugal Exclusive
marriage coming from exclusive property

E. RULES IN DETERMINING THE PROPERTY RELATIONSHIP

If NO agreement on marriage settlement

Date of Marriage Regime
Before August 3, 1988 CPOG
On or After August 3, 1988 ACOP

DEDUCTIONS
b. Claims Against Insolvent Persons
I. ALLOWABLE DEDUCTIONS DEFINED
 Requisites:
 Deductions are items which the law on estate 1. Value of the claims is included in the gross
tax allows to be subtracted from the value of estate; and
the gross estate in order to arrive at the net
taxable estate. 2. The insolvency of the debtor must be
established.
 As a rule, deductions from gross estate are
presumed to be common deductions unless c. Claims Against the Estate
specially identified as exclusive.
 Requisites:
II. CLASSIFICATION OF DEDUCTIONS 1. Personal debt of the decedent existing at
the time of his death;
1) Ordinary deductions 2. Contracted in good faith;
2) Special Deductions 3. Must be valid in law and enforceable in
3) Share of the surviving spouse court;
4. Must not have been condoned by the
III. ORDINARY DEDUCTIONS – classified as creditors;
exclusive or common deduction. 5. Must not have prescribed;
6. Debt instrument must be notarized;
1) LOSSESS, INDEBTEDNESS, TAXES (LIT) 7. If the loan was contracted 3 years before
death, submit statement showing the
a. Casualty Losses disposition of the proceeds.

 Requisites: d. Unpaid Mortgage

1. Incurred during the settlement of the
estate;
2. Arising from fires, storms, shipwreck,
or other casualties, or from robbery,
theft or embezzlement;
3. Not compensated by insurance;
 Requisites:
1. The fair market value of the mortgaged
property undiminished by the mortgage
indebtedness should be included in the
gross estate;
2. Contracted in good faith; and
3. For an adequate and full consideration.

4. Not claimed as deduction for income e. Unpaid Taxes

tax purposes;  Requisite – the tax must have accrued before
the death of the decedent.
5. Incurred not later than the last day for
the payment of the estate tax. The following are not deductible:
 1. Any income tax upon income received after Exclusive
death; Claims against insolvent Common or
2. Property taxes not accrued before death; persons Exclusive
and Claims against the Common or
3. Estate tax from the transmission of his estate Exclusive
estate. Unpaid Mortgage Common or
Exclusive
2) TRANSFER FOR PUBLIC USE Unpaid Taxes Common or
Exclusive
 Requisites: Transfer for public use Exclusive
1. Given to the Government of the Philippines Vanishing Deduction - Under CPOG –
(National or local); exclusive
2. Must be testamentary in character; or - Under ACOP –
3. By way of donation mortis causa executed exclusive or
by the decedent before his death; common
4. Exclusively for public purpose.

3) PROPERTY PREVIOUSLY IV. SPECIAL DEDUCTIONS

TAXED/VANISHING DEDUCTION
1) Standard Deduction – the amount deductible
 Requisites: without any required substantiation is:
1. The decedent died within 5 years from  Decedent is a citizen or resident =
receipt of the property from a prior P5,000,000
decedent or donor;  Decedent is NRA = P500,000
2. The property on which the vanishing 2) Family Home Allowance
deduction is being claimed is located in the  Allowed only to citizen and resident decedents
Philippines.
 Requisites:
3. The property must have formed part of the a. The decedent is married or head of a
taxable estate of the prior decedent or the family;
taxable gift of the donor and the transfer b. The family home must be the actual
tax relative thereto had been paid; residential home of the decedent and his
family at the time of his death, as certified
4. The property on which vanishing deduction by the Brgy. Captain of the locality the
is being taken must be identified as the family home is situated;
one received from the prior decedent, or c. It is located in the Philippines;
from the donor, or something acquired in d. The value of the family home is included in
exchange therefore; the gross estate; and
e. Must not exceed the limit set by law.
5. No vanishing deduction on the property
was allowable to the estate of the prior  Amount Deductible:
decedent. a. Actual Interest vs.
whichever
b. Limit is lower
 Amount deductible:
 LIMIT = P10,000,000
PROFORMA COMPUTATION
Initial Value PXXX Rule in Determining Actual Interest
Less: Mortgage paid by present Exclusive Property 100%
decedent (XXX) Common Property 50%
Initial Basis (IB) PXXX
Less: Proportional Deduction
[(IB/GE) x (LIT+TPU)] (XXX) 3) Amount Received by heirs under R.A. 4917
Final Basis PXXX Requisite – Include such amount in the gross
Rate X% estate.
Vanishing Deduction PXXX
 Amount Deductible – amount received
by the heirs from the decedent’s employer
INTERVAL OF ACQUISITION RATE as a consequence of the death of the
AND DEATH OF PRESENT decedent-employee.
DECEDENT
Within 1 year 100%  Allowed only to citizen and resident
More than 1 year but not more decedents
than 2 years 80%
More than 2 years but not more
than 3 years 60% V. SHARE OF THE SURVIVING SPOUSE –
More than 3 years but not more applicable only to married decedents.
than 4 years 40%
More than 4 years but not more  Amount Deductible:
than 5 years 20%
Common Properties PXXX
CLASSIFICATION OF ORDINARY Common Deductions (XXX)
DEDUCTIONS FOR MARRIED DECEDENT Net Common Properties PXXX
Casualty Losses Common or Multiply by: 50%
 Share of the Surviving Spouse PXXX

VI. SUMMARY RULES ON DEDUCTIBILITY BASED ON RESIDENCE AND/OR CITIZENSHIP

Decedent is Resident Decedent is Nonresident Alien
Items of Deduction or Citizen
1. LIT (Losses, Indebtedness and Deductible Phil. GE X LIT WORLD
Taxes) Total GE
2. Vanishing Deduction Deductible Deductible
3. Transfer for Public Purpose Deductible Deductible
5. RA 4917 Deductible Non-Deductible
6. Share of the Surviving Spouse Deductible Deductible
7. Family Home Deductible Non-Deductible
8. Standard Deduction Deductible (5M) Deductible (500,000)

RATES OF ESTATE TAX

 If decedent died on or after Jan. 1, 2018, estate tax due is equivalent to 6% of Taxable Net Estate.
 When shall certification by a Certified
TAX CREDIT FOR ESTATE TAX PAID TO A Public Accountant (CPA) needed?
FOREIGN COUNTRY
 It shall be supported with a statement duly
 Who can claim? certified to by a CPA when the estate tax
Only resident or citizens can claim tax credit. return shows a gross value exceeding
P5,000,000.
 Amount Deductible:
a. Actual estate tax paid abroad  Place of filing the return:
whichever is
b. Limit a. In case of a resident decedent:
lower
a. Authorized agent bank; or
 Limit: b. Revenue District Officer;
a. Only one foreign country is involved c. Collection Officer; or
d. Duly authorized Treasurer of the city or
Net Estate, foreign municipality in which the decedent was
X Philippine Estate Tax
World Net Estate domiciled at the time of his death.

b. In case of a non-resident decedent:

b. Two or more foreign countries are
involved (whichever is lower of the
following):
Limit A – Per Foreign Country
Net Estate, per foreign
X Philippine Estate Tax
World Net Estate
Limit B – By Total
Net Estate, all foreign countries
World Net Estate
a. Revenue District Office where the
executor or administrator is registered
b. Revenue District Office having
jurisdiction over the executor or
administrator’s legal residence (if
executor or administrator is not
registered)
c. Office of the BIR Commissioner (RDO
No. 39 – South Quezon City) if the
estate does not have an executor or
administrator in the Philippines.
Philippine
X Payment of Estate Tax
Estate Tax 

 Estate tax shall be paid at the time the

COMPLIANCE REQUIREMENTS return is filed (Pay as you file)

A. ESTATE TAX RETURN  Allowed extension:

a. 5 years if settled judicially
 When is it required? b. 2 years if settled extra-judicially
1. In all cases of transfer subject to estate
tax;  Payment of the estate tax by installment
2. Regardless of the amount of the gross and partial disposition of estate.
estate, where it consists of registered or
registrable property. In case of insufficiency of cash for the
immediate payment of the total estate tax due,
 Who shall file? the estate may be allowed to pay the estate
1. Executor tax due through the following options,
2. Administrator including the corresponding terms and
3. Any of the legal heirs conditions:

 When is the deadline? 1) Cash installment

Within one year after death
Can be extended not exceeding 30 days if
authorized by the BIR Commissioner.
 The cash installments shall be made
within two (2) years from the date of
filing of the estate tax return;
 The estate tax return shall be filed
within one (1) year from the date of
decedent’s death;
  The frequency (i.e., monthly,
quarterly, semi-annually or annually),
deadline and amount of each
installment shall be indicated in the
estate tax return, subject to the prior
approval by the BIR;
 In case of lapse of two years without
the payment of the entire tax due, the
remaining balance thereof shall be and
demandable subject to the applicable
penalties and interest reckoned from
the prescribed deadline for filing the
return and payment of the estate tax;
and
 No civil penalties or interest may be
imposed on estates permitted to pay
the estate tax due by installment.
Nothing in this provision, however,
prevents the Commissioner from
executing enforcement action against
the estate after the due date of estate
tax.
2) Partial disposition of estate and application
of its proceeds to the estate tax due
 The disposition , for purposes of this
option, shall refer to the conveyance of
property, whether real, personal or
intangible property, with the equivalent
cash consideration;
 The estate tax return shall be filed
within one year from the date of
decedent’s death;
 The written request for the partial
disposition of the estate shall be
approved by the BIR. The said request
shall be filed, together with a notarized
undertaking that the proceeds thereof
shall be exclusively used for the
payment of the total estate tax due;
 The computed estate tax due shall be
allocated in proportion to the value of
each property;
 The estate shall pay to the BIR the
proportionate estate tax due of the
property intended to be disposed of.
 An electronic Certificate Authorizing
Registration (eCAR) shall be issued
upon presentation of the proof of
payment of the proportionate estate
tax due of the property intended to be
disposed. Accordingly, eCARs shall be
issued as many as there are properties
intended to be disposed to cover the
total estate tax due, net of the
proportionate estate tax(es) previously
paid under this option; and
 In case of failure to pay the total
estate due out from the proceeds of
the said disposition, the estate tax due
shall be immediately due and
demandable subject to the applicable
penalties and interest reckoned from
the prescribed deadline for filing the
return and payment of the estate tax,
without prejudice of withholding the
issuance of eCAR(s) on the remaining
properties until the payment of the
remaining balance of the estate tax
due, including penalties and interest.
 Request for Extension of Time,
Installment Payment and Partial
Disposition of Estate.
The request for extension of time to file the
retrun, extension of time to pay estate tax and
payment by installment shall be filed with the
Revenue District Officer (RDO) where the
estate is required to secure its TIN and file the
estate tax return. This request shall be
approved by the Commissioner or his duly
authorized representative.
B. Duties of Certain Officers and Persons
 No judge shall authorize the executor or
judicial administrator to deliver a distributive
share to any party interested in the estate,
unless a certification from the Bureau of
Internal Revenue (BIR) that the estate tax has
been paid is shown.
 Register of Deeds shall not register in the
registry of property any transfer of real
property or real rights therein, or any
mortgage, by way of donation mortis causa or
inheritance, without a certification from the
BIR of payment of estate tax, and they shall
immediately notify the BIR of non-payment of
tax discovered by them.
 Any lawyer, notary public or any government
officer who, by reason of his official duties,
intervenes in the preparation or
acknowledgment of documents regarding
partition or disposal of donations inter vivos or
mortis causa, legacy or inheritance shall
furnish the BIR with copies of such documents
and any information whatsoever which may
facilitate the collection of the estate tax.
 There shall not be transferred to any new
owner in the books of any corporation,
sociedad anonima, partnership, business, or
industry organized or established in the
Philippines any share, obligation, bond or right
by way of gift inter-vivos or mortis causa,
legacy or inheritance, unless an eCAR is issued
by the Commissioner or his duly authorize
representative.
 If bank has knowledge of the death of a person
who maintained a bank account alone, or
jointly with another, it shall allow the
withdrawal from said deposit account, subject
to a final withholding tax of 6% of the amount
to be withdraw, provided, that the withdrawal
shall only be made within one year from the
date of said decedent.
In all cases, the final tax withheld shall not be
refunded, or credited on the tax due, on the
net taxable estate of the decedent.
In instances where the deposit accounts have
been duly included in the gross estate of the
decedent and the estate tax due thereon paid,
the executor, administrator, or any of the legal
heirs shall present the eCAR issued for the said
estate prior to withdrawing from the bank
deposit account. Such withdrawal shall no
longer be subject to the withholding tax
imposed under this section.
MULTIPLE CHOICE
1. Estate tax is III. By onerous transfer
a. A property tax because it is imposed on the a. I only c. I and III only
property transmitted by the decedent to his heirs. b. I and II only d. I, II and III
b. An indirect tax because the burden of paying the
tax is shifted on the executor or any of the heirs of 10. An act whereby a person is permitted, with the
the decedent formalities prescribed by law, to control to a certain
c. An excise tax because the object of which is the degree the disposition of his estate, to take effect after
shifting of economic benefits and enjoyment of his death.
property from the dead to the living a. Contract c. Will
d. A poll tax because it is also imposed on residents b. Trust d. Legacy
of the Philippines whether Filipino citizens or not
11. The following are the elements of succession, except:
2. Estate tax accrues from: a. Decedent c. Heir
a. The moment of death of the decedent b. Estate d. Executor
b. The moment the notice of death is filed
c. The moment the estate tax return is filed 12. Succession which results from the designation of an
d. The moment the properties are delivered to the heir, made in a will executed in the form prescribed by
heirs law is known as:
a. Legal or intestate succession
3. The taxpayer in estate tax is: b. Testamentary succession
a. The decedent c. Mixed succession
b. The estate as a juridical entity d. Ordinary succession.
c. The heirs or succession
d. The administrator or executor 13. The portion of the decedent’s estate which the law
reserves to his compulsory heir is called:
4. Who has the personal liability to pay estate tax? a. Legitime c. Legacy
a. The decedent b. Free portion d. Bequest
b. The estate as a juridical entity
c. The heirs or successors
14. Which of the following is a valid will?
d. The administrator or executor
a. That which reduces the legitime of compulsory
heirs.
5. It is a well settled rule that estate taxation is governed
b. That which increase the share of one heir without
by the statute in force at the time of:
impairing the legitime of the other heirs.
a. Creation of the last will testament or death of the
c. That which transfer the legitime of one heir to the
decedent in case of intestate succession other heir.
b. Death of the decedent d. That which impair the legitime of compulsory heirs.
c. Filing of estate tax return
d. Either letter “b” or “c” whichever will result to 15. A person who inherits specific personal property thru a
higher estate tax liability will:
a. Devisee c. Heir
6. An executor or administrator, after paying the estate b. Legatee d. Successor
tax, and to escape a future liability for a deficiency
16. A person who inherits specific real property thru a will:
estate tax, must secure a written discharge from
a. Devisee c. Heir
personal liability from:
b. Legatee d. Successor
a. The heirs.
b. The Commissioner of Internal Revenue.
17. One of the following is subject to estate tax on
c. The court where the estate was being settled.
properties situated within the Philippines only
d. Need not secure a written discharge as long as he
a. resident citizen c. nonresident citizen
has a receipt on payment of the estate tax.
b. resident alien d. nonresident alien
7. It is a mode of acquisition by virtue of which, the
18. The personal properties of a non-resident, not citizen
property, rights and obligations, to the extent of the
of the Philippines, would not be included in the gross
value of the inheritance, of a person are transmitted
estate if:
through his death to another either by his will or by
a. The intangible personal property is in the
operation of law.
Philippines
a. Succession c. Prescription
b. The intangible personal property is in the
b. Donation d. Exchanges
Philippines and the reciprocity clause of the estate
tax law applies
8. Which statement is false about succession:
c. The tangible personal property is in the Philippines
a. The successor inherits all the transmissible
d. The personal property is shares of stock of a
property of a decedent including his liabilities.
domestic corporation 80% of whose business is in
b. The successor can be made liable for the
the Philippines.
obligations of the decedent beyond the value of the
asset he received.
19. All of the following are considered intangible in the
c. In succession, fruits and credits maturing after the
Philippines, except:
death of the decedent pass to the heirs even if
a. Franchise which must be exercised in the
they were not subjected to estate tax.
Philippines
d. In succession, the successor can refuse the
b. Shares, obligations or bonds issued by any
inheritance.
corporation or sociedad anonima organized or
9. Which of the following could legally effect transfer of constituted in the Philippines in accordance with its
properties through succession? laws
I. By virtue of a will
II. By operations of law

Page 11 of 17 TAX.1702
FEU MAKATI

c. Shares, obligations or bonds by any foreign 25. Lolo Sot, 95 years old, was diagnosed of various
corporation 75% of the business of which is ailments on January 1, 2018. Motivated by thought of
located in the Philippines death, he decided to dispose all his properties to his
d. Shares, obligations of bonds issued by any foreign children and relatives. He executed a last will and
corporation if such shares, obligations or bonds testament disposing all his properties in the Philippines
have acquired a business situs in the Philippines; to his children. On the same day, he made donations
inter-vivos to his other relatives as to his properties in
20. Part of the estate left by A are preference shares of the United States. Lolo Sot died a month after
MERALCO. The shares are listed and traded in the disposing all his properties. Should the properties
Philippine Stock Exchange. Which of the following rules donated by Lolo Sot to his other relatives be included
of valuation is correct? in his gross estate upon his death?
a. The preference shares will be valued using the a. No, because they were not his properties anymore
arithmetic mean between the highest and lowest at the time of death.
quotation at the date nearest the date of death, if b. Yes, because the donations were donations mortis
causa and should be governed by the rules on
none is available on the date of death itself.
estate taxation.
b. The preference shares will be valued based on
c. No, if the donor’s tax had been paid already on
their book value. the donations.
c. The preference shares will be valued based on d. No, because they were not transfers in
their par value. contemplation of death, since the donations were
d. The preference shares will be valued based on not simultaneous with the execution of the last
their fair market value as determined by the will and testament.
Commissioner of Internal Revenue
26. The following are subject to estate tax, except
a. While still alive, the decedent donated property
21. Binat died on April 13, 2018, leaving the following where the donation will take effect at the time
properties: of his death.
Common stocks of Sunchamp Corporation (2,000 b. The decedent transferred a property in the
shares) - listed in the Philippine Stock Exchange regular course of the business operation.
(highest - P40; lowest - P39). c. The decedent donated a property with the
Common stocks of AgriNurture Corporation (1,500 condition that he/she will enjoy the fruits of
shares) - not listed in the stock exchange. Cost - P50 such while he/she is still alive.
per share; book value - P45 per share. d. The decedent transferred a property to take
effect after his/her death
Preferred stocks of Greenergy Inc. (3,000 shares) –
not listed in the stock exchange. Cost - P70 per share; 27. One of the following donations is not included as part
book value - P60 per share; par value – P50 per share of gross estate
Car (cost - P600,000; book value - P350,000; market a. Revocable transfers
value - P400,000) b. Transfers with reservation of certain rights
c. Transfers under special power of appointment
Real properties (zonal value - P120,000; assessed d. Transfers in contemplation of death
value - P72,000)
The gross estate of Binat is – 28. Statement 1: Aguinaldo devised in his will a piece of
a. P817,500 c. P824,000 land; naked title to Bonifacio and usufruct to Rizal for
b. P816,500 d. P846,500 as long as Rizal lives, thereafter to Bonifacio. The
transmission from Aguinaldo to Bonifacio and Rizal is
22. Lina Lamay, Filipina, died in Syria leaving the following subject to estate tax but the merger of the usufruct
properties: and the naked title to Bonifacio upon the death of Rizal
House and Lot in Syria 1,000,000 is exempt.
Vacant Lot in Manila 2,000,000
Shares of stock in a domestic corp., 60% 100,000 Statement 2: Erap devised in his will real property to
of the business is located in the his brother Alfredo who is entrusted with the obligation
Philippines to preserve and transmit the property to Isko, son of
Shares of stock in a foreign corp., 70% 200,000 Alfredo, when Isko becomes of age. The transmission
of the business is located in the from Alfredo to his son Isko is subject to tax.
Philippines a. Only statement 1 is correct
Car in Manila 500,000 b. Only statement 2 is correct
c. Both statements are correct
How much is the gross estate? d. Both statements are incorrect
a. P3,800,000 c. P2,500,000
b. P2,600,000 d. P2,000,000 29. Pedro, decedent, owns a property valued at
P1,500,000 at the time of his death. The said property
23. Based on the preceding number, but assuming the decedent is was sold by Pedro during his lifetime to Juan for
a non-resident alien, the gross estate is: P700,000 when its value was P1,200,000. It was
a. P3,800,000 c. P2,500,000 agreed by Pedro and Juan that the former will enjoy
b. P2,600,000 d. P2,000,000 the income of the property as long as he lives. For
Philippine estate tax purposes, how much will be
24. Continuing number 23 and the rule of reciprocity included in determining gross estate?
applies, the gross estate is: a. P500,000 c. P800,000
a. P3,800,000 c. P2,500,000 b. P1,200,000 d. P0
b. P2,600,000 d. P2,000,000

Page 12 of 17 TAX.01
FEU MAKATI

30. Based on the preceding number, if the fair market

value of the property at the time of death is only 37. Statement 1: In the absence of marriage settlements
P600,000, how much will form part of gross estate? executed before the marriage, the property
a. P500,000 c. P800,000 relationship between husband and wife shall be
b. P1,200,000 d. P0 governed by local custom and by the provisions of law,
respectively.
31. Vlad died on October 20, 2018. During his lifetime, Statement 2: Claims against insolvent persons may be
upon knowing that he had Stage 4 cancer, sold his charged against exclusive property
Lamborghini car to his son for P4,000,000. The fair a. Only statement 1 is correct
market value of the car at the time of sale is b. Only statement 2 is correct
P3,000,000 while it is already valued at P5,000,000 at c. Both statements are correct
the time of death. The amount that will be added to d. Both statements are incorrect
gross estate is:
a. P1,000,000 c. P2,000,000 38. One of the following is a conjugal property of the
b. P5,000,000 d. nil spouses
a. That which is brought to the marriage as his or her
32. Based on the preceding number, if the consideration is own.
fictitious, how much will form part of gross estate? b. That which each acquires during the marriage by
a. P1,000,000 c. P2,000,000 inheritance.
b. P5,000,000 d. nil c. The fruits of an exclusive property.
d. That which is purchased with the exclusive
33. Who among the following transferors is not liable for property of the wife.
estate tax on the property transferred during his
lifetime? 39. One of the following is not a community property of
a. The testator who bequeaths property to his heirs in the spouses
a last will and testament executed and probated a. Property inherited by the husband before marriage
during his lifetime. b. Winnings in gambling
b. The donor who reserves his right to amend or c. Fruits of property inherited during the marriage
revoke the donation of property in favor of the d. Fruits of property inherited before the marriage
donee.
c. The donee of an appointed property who is 40. If the decedent is married under the conjugal
required under a power of appointment to transfer partnership of gains, vanishing deduction shall be
such property upon death to his eldest child. chargeable against?
d. The transferor of personal property who sold it for a. Exclusive Properties
insufficient consideration. b. Conjugal Properties
c. Either Exclusive Properties or Conjugal Properties
34. Which of the following life insurance proceeds shall not d. Neither Exclusive nor Conjugal Properties
be included in the computation of gross estate?
a. Beneficiary is the estate, executor or administrator Use the following data for the next two questions:
and the designation of the beneficiary is revocable; Pedro, married to Susan, died leaving the following:
b. Beneficiary is the estate, executor or administrator
and the designation of the beneficiary is Car acquired before marriage by Pedro P300,000
Car acquired before marriage by Susan 450,000
irrevocable;
c. Beneficiary is other than the estate, executor or House and lot acquired during marriage 1,500,000
Jewelries of Susan 100,000
administrator and the designation of the
beneficiary is revocable; Personal properties inherited by Pedro 250,000
d. Beneficiary is other than the estate, executor or during marriage
administrator and the designation of the Land inherited by Susan during 1,000,000
beneficiary is irrevocable. marriage
Rental income on land inherited by 200,000
35. The list provided below is not included in the gross Susan (25% of which was earned after
estate of a decedent, except: Pedro’s death)
a. Share in common properties of the surviving Benefits from SSS 350,000
spouse; Retirement benefits 480,000
b. Exclusive property of the surviving spouse; Proceeds of group insurance taken by 175,000
c. Properties outside the Philippines of a non- Juan’s employer
resident alien decedent;
d. Intangible personal property in the Philippines 41. How much is the correct gross estate if the property
of a non-resident alien when the rule of Reciprocity relationship is conjugal partnership of gains?
applies. a. P1,950,000 c. P2,600,000
b. P2,200,000 d. P3,600,000
36. The following are transactions and acquisitions exempt
from transfer tax, except 42. How much is the correct gross estate if the property
a. Transmission from the first heir or donee in favor
relationship is absolute community of property?
of another beneficiary in accordance with the
a. P1,950,000 c. P2,600,000
desire of the predecessor
b. P2,200,000 d. P3,600,000
b. Transmission or delivery of the inheritance or
legacy by the fiduciary heir or legatee to the
Use the following data for the next two (2) questions:
fideicommissary
The estate of Pedro, resident citizen decedent, married,
c. The merger of usufruct in the owner of the
who died on April 1, 2018 are as follows:
naked title
House and lot (Family Home) P14,000,00
d. All bequests, devises, legacies or transfers to
The lot was acquired at a cost of 0
social welfare, cultural and charitable institutions
P3,000,000 before marriage while

Page 13 of 17 TAX.01
FEU MAKATI

the house was constructed on d. If the loan was contracted 3 years before death,
March 1, 2018, during marriage, submit statement showing the disposition of the
at a cost of P10,000,000 from proceeds.
partnership funds. The lot had a
fair market value of P4,000,000 49. Mr. Pobre is in need of money to start a small
after construction of the house. business. However, he has no property to secure a
Other properties acquired during 6,000,000 loan from a bank so he sought the help of his good
marriage friend Mr. Rich. Mr. Rich then obtained a loan from
Jewelry inherited on Feb. 14, 2017, 2,500,000 Banco de Uro amounting to 1million pesos secured by
during marriage, then with a fair a real property worth 2million pesos to accommodate
market value of P1,300,000 the request of Mr. Pobre. If subsequent to securing the
Property in U.S., received as gift 2,300,000 loan and delivering to Mr. Pobre the proceeds, Mr. Rich
during marriage from a friend on Jan. died, how much gross estate should be reported?
12, 2017 (the applicable donor’s tax a. P1,000,000 c. P3,000,000
was not paid by the donor) b. P2,000,000 d. nil
Rental income on the above property 1,200,000
up to time of death 50. Which of the following is not deductible from the gross
Expenses/Claims: estate of a decedent?
Funeral expenses 420,000 I. Income taxes on income received after death
Judicial expenses 800,000 II. Property taxes not accrued before death
Casualty losses incurred on Dec. 10, 600,000 III. Estate Tax
2018 a. I and II only c. All of the above
Claims against the estate 1,600,000 b. II and III only d. None of the above
Medical expenses within 1 year prior 4,000,000
to death, only half was receipted 51. The following are the requisites for vanishing deduction
to be allowable, except one.
43. How much is the net taxable estate under Conjugal a. The estate tax of the prior succession must have
Partnership of Gains? been finally determined and paid.
a. P3,926,000 c. P3,426,000 b. The present decedent died within five (5) years
b. P6,426,000 d. P1,348,000 from date of death of the prior decedent.
c. The property with respect to which deduction is
44. How much is the net taxable estate under Absolute sought can be identified as having been received
Community of Property? by the present decedent from the prior decedent.
a. P4,836,000 c. P1,174,000 d. None of the above
b. (P2,174,000) d. P2,174,000
52. Ded Nha, a citizen of the Philippines and resident of
45. The following data were taken from the estate of Oslo: Manila died intestate on November 2, 2018. Among
 Claims against Juan (insolvent), P100,000, fully his gross estate are properties acquired through public
uncollectible. sale of properties left by Bernardo who died 4½ years
 Claims against Manuel (insolvent), P200,000, 50% ago. What percentage of deduction will be used in
collectible. computing the amount of vanishing deduction?
 Claims against a person who absconded, a. 60% c. 20%
P300,000. b. 40% d. nil

Based on the data provided, how much should be 53. Mr. Sabillo, resident decedent, married, died, leaving the
deducted from Pedro’s gross estate? following properties:
a. P600,000 c. P200,000 Real and personal properties P 3,000,000
b. P500,000 d. nil acquired during the marriage
House and lot inherited from his 2,000,000
46. Which statement is incorrect about claims against father one year and 3 months before
insolvent persons? he died (fair market value when
a. They must be included in the gross estate even if inherited, P1,500,000) used as the
uncollectible. decedent's family home
b. They must be duly notarized as a rule. Car purchased with cash received as 500,000
c. The deduction is only the uncollectible portion. gift from his mother during the year
d. The insolvency of the debtor must be established. he died
Cash (inclusive of P500,000 received 1,500,000
47. Deductible claims against the estate or indebtedness in as inheritance from the father)
respect of property may arise out of, except:
a. Contract The following obligations and expenses were also
b. Tort made available:
c. Operation of law Claims against conjugal properties 600,000
d. None of the choices Unpaid mortgage on the inherited house 100,000
and lot (original mortgage was for
48. The following are the requisites in order for claims P600,000)
against the decedent's estate may be deductible,
except which one? How much is the vanishing deduction?
a. They must be the personal debt of the decedent a. P1,530,000 c. P1,000,000
b. They must be enforceable in court. b. P1,080,000 d. None of the choices
c. They may have been condoned prior to death.
54. Teh Pok died on November 20, 2018 . Some of the
properties he left are the following:

Page 14 of 17 TAX.01
FEU MAKATI

Mode Market Value 61. In computing the estate tax, which of the following
of Date Date Date of shall not be allowed to claim tax credit for taxes paid
Asset Acquisition Acquired Acquired Death abroad?
Land Purchase 7-3-14 500,000 350,000 a. Resident alien decedent
Car Donation 10-2-17 800,000 980,000 b. Non-resident alien decedent
c. Resident citizen decedent
Other information: d. Non-resident citizen decedent
a) The gross estate of the decedent amounts to
P3,000,000. 62. Jiraiya, non-resident Japanese, died on May 1, 2018
b) The car was mortgaged for P50,000 when it leaving the following:
was acquired and Teh Pok paid the same Exclusive properties, Philippines P5,600,000
before he died. Conjugal properties, Philippines 4,200,000
c) The allowable deductions totaled P325,000, Conjugal properties, Abroad 18,200,000
which includes judicial expenses of P30,000 Claims against insolvent persons 1,000,000
and funeral expenses of P150,000. Funeral expenses 200,000
Judicial expenses 850,000
The vanishing deduction is – Claims against the estate 1,500,000
a. P581,000 c. P648,783 Losses: occurring 8 mos. after death
b. P571,000 d. P637,617 due to fire 1,700,000
Donation mortis causa to Makati City
55. Which of the following statements is incorrect in Hall 1,800,000
connection with family home? Family Home (inc. above), located
a. Family home deduction shall be allowed only if abroad 10,000,000
such family home is situated in the Philippines Standard deduction 10,000,000
b. The total value of the family home must be
included as part of the gross estate of the The taxable net estate is:
decedent a. P5,165,000 c. P4,165,000
c. For purposes of availing family home deduction, a b. P4,665,000 d. P21,000,000
person may constitute only one family home 63. If decedent is a Filipino citizen, the taxable net estate
d. Family home deduction may not be lower than
is:
P10,000,000
a. P11,490,000 c. P4,100,000
b. P12,645,000 d. P7,900,000
56. Pedro died on Nov. 1, 2018 leaving a family home
composed of the following: Conjugal house worth
64. Mr. Nakalimot Huminga, head of family, died on
P8,000,000, and the land which he exclusively owned
January 15, 2018 , leaving the following properties and
valued at P4,000,000. He also owns a vacation house
obligations:
in Baguio worth P7,000,000.
Cash in bank, 50%, donated mortis
causa to Natl Govt;50-% to Q.C. P300,000
The deductible amount of family home is:
gov’t
a. P8,000,000 c. P4,000,000
House and lot in Makati, F. 1,500,000
b. P12,000,000 d. P10,000,000
Home
Personal properties 1,500,000
57. Based on the preceding number, if the house is also an
Farm lot 825,000
exclusive property, how much is the deductible family
Claim against an insolvent debtor 225,000
home allowance?
Transfer in contemplation of death 1,500,000
a. P8,000,000 c. P4,000,000
(gratuitous)
b. P12,000,000 d. P10,000,000
Transfer passing under special power 75,000
of appointment
58. The following statements are correct regarding
Deductions claimed:
standard deduction, except:
Funeral expenses 575,000
a. A deduction in the amount of P5,000,000 shall be
Judicial expenses 67,500
allowed as an additional deduction without need of
Donation mortis causa to Quezon City 150,000
substantiation.
government
b. The full amount of P5,000,000 shall be allowed as
Unpaid mortgage on the farm lot 75,000
deduction for the benefit of the decedent.
Medical expenses (included in the 225,000
c. Standard deduction is not allowed to decedents
funeral expenses incurred within the
who are non-resident aliens.
1 year period with receipts)
d. None of the above
The farm lot was inherited 5 ½ years ago by the
59. All of the following, except one, are not deductible
decedent before his death with a value then of
from the gross estate of a non-resident alien:
P575,000 and a mortgage indebtedness of P150,000.
a. Casualty losses
b. Death benefits under RA 4917
The taxable net estate is:
c. Family home allowance
a. P3,757,500 c. P2,757,500
d. Standard deduction
b. P4,982,500 d. (P1,250,000)
60. One of the following cannot be claimed as deduction
Next two (2) questions are based on the following:
from the gross estate of a non-resident alien decedent:
A citizen-decedent died in 2018 with the following data:
a. Vanishing deduction
Philippines USA
b. Family home allowance
Gross Estate P14,200,00 P4,400,000
c. Share of surviving spouse
0
d. Transfer for public use

Page 15 of 17 TAX.01
FEU MAKATI
Allowable Deductions 6,400,000 2,200,000
(excluding standard
deduction)
Estate tax paid - 150,000
65. How much is the estate tax payable in the Philippines
assuming the decedent is a non-resident citizen?
a. P168,000 c. P150,000
b. P132,000 d. P300,000
66. How much is the estate tax payable in the Philippines
assuming the decedent is a non-resident alien?
a. P168,000 c. P150,000
b. P438,000 d. P300,000
67. Lola Trining died in 2019 leaving a gross estate
amounting to P150,000 only. No estate tax is due
based on the tax code. The gross estate is composed
of a second hand car worth P80,000, shares of stocks
valued at P50,000 and P20,000 time deposit. The
administrator believes that only notice of death should
be filed since the value of the gross estate is exempt
from tax. What will you tell him?
a. Notice of death and estate tax return have to be
filed because the gross estate exceeds P20,000
and when the gross estate consists of registered or
registrable properties, estate tax is required to be
filed regardless of the value of the gross estate.
b. Only notice of death is required to be filed because
the gross estate exceeds P20,000. Estate tax
return is required to be filed only when the gross
estate exceeds P200,000 and/or there is estate tax
due.
c. Neither notice of death nor estate tax return need
to be filed in this particular case.
d. Only estate tax return has to be filed.
68. Which of the following is not correct?
a. When a compulsory heir is given by will less than
his legitime, the provisions of the will should be
modified in such a way that he will receive his
legitime.
b. The CIR may examine the bank deposit of a
decedent for the purpose of determining his gross
estate even if the estate did not request for a
compromise on the ground of financial incapacity.
c. The sharing of heirs in testamentary succession
must satisfy the rules on legitime.
d. If an extension to pay the estate tax is granted,
the Commissioner or his duly authorized
representative may require the administrator, or
executor, or beneficiary, to furnish a bond in such
amount exceeding double the amount of the tax
and with such sureties as the Commissioner deems
necessary, conditioned upon the payment of said
tax in accordance with the terms of the extension.
69. Statement 1: Any amount paid beyond the statutory
due date of the tax, but within the extension period,
shall be subject to interest but not to surcharge.
Statement 2: No extension for payment of estate tax
shall be granted where the request for extension is by
reason of negligence, intentional disregard of rules and
regulations, or fraud on the part of the taxpayer.
a. Only statement 1 is correct
b. Only statement 2 is correct
c. Both statements are correct
d. Both statements are incorrect
70. In case of a resident decedent, the administrator of
executor shall register the estate of the decedent and
secure new TIN from the the
a. Office of the Commissioner.
Page 16 of 17
b. RDO where the administrator or executor is
registered.
c. RDO where the decedent was domiciled at the
time of his death.
d. Duly authorized treasurer of the city or
municipality where the decedent is domiciled
at the time of his death.
71. Can the estate tax be paid in installment?
a. Yes, in case the available cash of the estate is
not sufficient to pay its estate tax liability.
b. Yes, at the option of the heirs with
corresponding interest charges.
c. No, tax is the lifeblood of the State, hence,
collection cannot be delayed under any
circumstance.
d. None of the above
72. Statement 1: If a bank has knowledge of the death of
a person, who maintained a bank account alone, or
jointly with another, it shall allow the withdrawal from
said deposit account, subject to a final withholding tax
of 6% of the amount to be withdrawn, provided, that
the withdrawal shall only be made within one year
from the date of said decedent.
Statement 2: In all cases, the final tax withheld shall
not be refunded, or credited on the tax due, on the net
taxable estate of the decedent.
a. Only statement 1 is correct
b. Only statement 2 is correct
c. Both statements are correct
d. Both statements are incorrect
73. Which of the following statements is correct?
a. There shall not be transferred to any new owner in
the books of any corporation, sociedad anonima,
partnership, business, or industry organized or
established in the Philippines any share, obligation,
bond or right by way of gift inter-vivos or mortis
causa, legacy or inheritance, unless an eCAR is
issued by the Commissioner or his duly authorize
representative.
b. In instances where the deposit accounts have been
duly included in the gross estate of the decedent
and the estate tax due thereon paid, the executor,
administrator, or any of the legal heirs shall
present the eCAR issued for the said estate prior to
withdrawing from the bank deposit account.
c. The withdrawal describe in letter b shall no longer
be subject to the 6% withholding tax by the bank.
d. All of the above
74. In filing the estate tax return under the TRAIN Law, a
CPA certificate is required when:
a. Gross estate exceeds P 2,000,000
b. Gross estate exceeds P 5,000,000
c. Gross estate exceeds P10,000,000
d. Gross estate reaches P 2,000,000
75. A died leaving a house and lot to B on March 31, 2018
which was questioned by C and it is under litigation
but, subsequently, the parties executed an extra-
judicial settlement. The last day for filing the estate
tax return is
a. April 30, 2018 c. September 30, 2018
b. April 30, 2019 d. March 31, 2019
76. The last day for the payment of estate tax may be
extended, until;
a. March 31, 2021 c. September 30, 2019
b. September 30, 2021 d. April 30, 2022
TAX.01
FEU MAKATI

77. Mr. John Go Lo, resident citizen, died on November 10,

2019 with the following relevant data for filing the estate
tax return:

Residence of Mr Go: 1008 P. Noval Street, Sampaloc,

Manila
TIN of Mr. Go: 123-456-789-0000
TIN of Estate of Mr. Go: 654-321-987-0000
Executor: Mr. Honey Sy Ga
TIN: 987-123-654-00000
Residece of Administrator: Dela Rosa St. Brgy. San
Lorenzo, Quezon City
Industrial Lot, Exclusive (FMV 2M) 3,000,000
Unpaid Mortgage, Exclusive 1,000,000
Family Lot, Conjugal (FMV 10M) 9,000,000
Family House, Conjugal 5,000,000
DMCI Homes, Inc., Conjugal
(Listed, 5,000 shares) 5,000,000
Cash in Eastwest Bank
(Saving Account No. 1986-1056-37) 8,000,000
Claims against the estate 1,000,000
Unpaid Mortgage 3,500,000
Unpaid Real Estate Tax 500,000

REQUIREMENT: Fill up the form based on the above data.

- done -

Page 17 of 17 TAX.01