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Estate Tax Amnesty Approved: Understanding RA 11956's Impact

The elation is palpable among numerous Filipino families as RA 11956, a further amendment to RA 11213 or the Tax Amnesty Act, transitioned into law on August 5, 2023.


Estate Tax in the Philippines: An Overview


In the Philippines, an estate tax of six percent (6%) is levied on the net value of the assets left behind by a deceased person. This tax has to be filed and paid within a year of the individual's passing. Delay in doing so can lead to accumulating penalties and interest.

6% estate tax rate in the Philippines.
Sample BIR Form 1801

From 2019 to 2023: The Evolution of the Tax Amnesty Act


Originally, the Tax Amnesty Act was rolled out in 2019, offering heirs a grace period till June 15, 2021, to clear any pending estate taxes devoid of additional penalties. Then, as a direct response to the pandemic's challenges, this amnesty received a two-year extension under RA 11569, moving the deadline to June 14, 2023.


This year, legislators, recognizing the unique challenges faced, especially by those in the provinces, championed another two-year extension through RA 11956. Consequently, the new cut-off date to benefit from this 'estate tax amnesty approved' is now June 14, 2025.



Senate approves Estate Tax Amnesty Extension

RA 11956: Expanding the Coverage and Streamlining the Process


RA 11956 doesn't just extend the amnesty deadline but broadens its scope. Previously, only unpaid estates of decedents who passed away before December 31, 2017, were covered. Now, the amnesty also encompasses unpaid or accrued estate taxes as of May 31, 2022.


Moreover, the requirements for availing the amnesty have been clearly laid out, ranging from death certificates to proofs of claims against the estate.


People lining up to file estate tax at the BIR

Estate Planning: Beyond Just Taxes


The passing of a loved one is challenging on multiple fronts. While navigating the emotional and physical aftermath, the looming financial obligation in the form of estate taxes can feel overwhelming. This makes estate planning a topic of crucial significance. Not restricted to the affluent, it's a tool that anyone with property should consider, especially with legal avenues available for tax-saving within the bounds of the law.

family discussing estate tax

Looking Forward: Awaiting Implementing Rules and Regulations


While RA 11956 brings renewed hope, the government is still to roll out the specifics through its Implementing Rules and Regulations (IRR).


For those seeking assistance, it's essential to reach out to legal experts to ensure that all protocols are meticulously followed, and benefits are maximized. Send us an e-mail at hello@lawyersonlineph.com.

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