ESTATE TAX AMNESTY

Estate Tax is a tax imposed on the decedent's right to transfer properties to lawful heirs and beneficiaries upon death. It also covers certain transfers legally deemed equivalent to testamentary dispositions, ensuring taxation on the transfer of wealth.

Estate Tax Amnesty Overview

The Philippine Estate Tax Amnesty, facilitated by Republic Acts (R.A.) No. 11213, 11569, and 11956, offers taxpayers an opportunity to settle outstanding estate tax liabilities with simplified procedures and without penalties. This program aims to ease the burden on heirs and promote compliance.

Estates that meet the amnesty requirements receive immunity from estate taxes, associated penalties, and potential civil, criminal, and administrative liabilities. The core of this program is the application of a uniform 6% flat estate tax amnesty rate on the net taxable estate of eligible decedents, without penalties at every stage of transfer of property. Provided, that the minimum Estate Amnesty Tax for the transfer of the estate of each decedent shall be Php5,000.00.

Initially, R.A. 11213 provided an Estate Tax Amnesty for estates of decedents who passed away on or before December 31, 2017, with an initial deadline of June 14, 2021. Recognizing the need for continued relief, R.A. No. 11569 extended the period to avail of Estate Tax Amnesty to June 24, 2023, allowing more families to benefit from the program.

R.A. No. 11956 further broadened the amnesty's coverage to include estates of decedents who died on or before May 31, 2022. This act also extended the deadline to avail of the Estate Tax Amnesty to June 14, 2025. In other words, lawful heirs and beneficiaries are given until June 14, 2025 to take advantage of the uniform 6% flat estate tax amnesty rate.

Refresher of Estate Tax Rates

Lawful heirs and beneficiaries who forgo the Estate Tax Amnesty will incur a significantly higher financial burden. Instead of paying the 6% flat estate tax amnesty rate without penalties, the estate will be subject to the estate tax rates legally enforceable at time of the decedent’s death ranging from 1 to 60%, along with substantial interest, surcharges, and potential compromise penalties. Below is a summary of the applicable estate tax rates from 1939 to present:

Time of Death	Tax Rate	Governing Law
July 1, 1939 to September 14, 1950	1% to 10%	Section 85 of the NIRC or Commonwealth Act No. 466
September 15, 1950 to December 31, 1972	1% to 15%	Section 85 of the NIRC, as amended by RA No. 579
January 1, 1973 to July 27, 1992	3% to 60%	Section 85 of the NIRC, as amended by Presidential Decree No. 69
July 28, 1992 up to December 31, 1997	5% to 35%	Section 77 of the NIRC, as amended by RA No. 7499
January 1, 1998 up to December 31, 2017	5% to 20%	Section 84 of the NIRC, as amended by R.A. No. 8424
January 1, 2018 to present	Flat rate of 6%	Section 84 of the NIRC, as amended by R.A. No. 10963

As of writing, covered estates only have less than 3 months to avail of the Estate Tax Amnesty program. After the June 14, 2025 deadline, covered estates will already be subject to the stiffer estate tax rates shown above plus penalties and surcharge.

This article is for informational purposes only and is not intended to be legal advice. For legal concerns, you may email the firm at legal@cditlaw.net.

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