What is Transfer Tax?

A transfer tax is imposed on tax on the sale, donation, barter, or any other mode of transferring ownership or title of real property at the maximum rate of 50% of 1% (75% of 1% in the case of
cities and municipalities within Metro Manila) of the total consideration involved in the acquisition of the property or of the fair market value in case the monetary consideration involved in the
transfer is not substantial, whichever is higher. This is pursuant to Section 135 of the Local Government Code of 1991 (LGC).

You need to pay the transfer tax because the evidence of its payment is required by the Register of Deeds of the province concerned before registering any deed. This is also required by the
provincial assessor before cancelling an old tax declaration and issuing a new one in its place. Please do not confuse the transfer tax which is paid to the local government with the transfer
taxes due to the BIR (which may either be donors or estate taxes).

Disclaimer: While great effort has been taken to ensure the accuracy of the discussion here as of its writing, this is not intended to replace seeking professional services. Always consult with your
tax attorneys and read up on the relevant laws and regulations also.

Who should pay

The payment of the transfer tax is the responsibility of the seller, donor, transferor, executor or and administrator.

When to pay

The deadline for payment is sixty (60) days from the date of the execution of the deed or from the date of the decedents death. Please note too that notaries public are required to furnish the
provincial treasurers with a copy of any deed transferring ownership or title to any real property within thirty (30) days from the date of notarization.

Surcharges and penalties for late payments (as per section 168 of RA 7160)

Surcharge No more than twenty-five percent (25%) of the amount of taxes, fees or charges not paid on time
Penalty No more than two percent (2%) per month of the unpaid taxes, fees or charges including surcharges, until such amount is fully paid, but in not to exceed thirty-six (36)
months or seventy-two percent (72%).

Where to pay

The transfer tax is to be paid at the Treasurers Office of the city or municipality where the property is located.

Requirements

In general, the requirements for the payment of transfer tax are the following:

Certificate Authorizing Registration from the Bureau of Internal Revenue;

Realty tax clearance from the Treasurers Office; and
Official receipt of the Bureau of Internal Revenue (for documentary stamp tax).

Transfer Tax Rates

With regard to the transfer tax rates, please click on the links to see the different transfer tax rates and documents required to transfer the registration of a property. You have to check the rates on a
per city or per municipality basis as the LGC only provides for the maximum rates. Click on the links below for the transfer tax rates of major cities.

Manila
Caloocan [I have no idea why the transfer tax rate in Caloocan is 82.5% of 1%]
Cebu
Davao
Las Pinas
Makati
Mandaluyong
Marikina
Pasig
Quezon City

The http://www.doingbusiness.org site is so cool. You can learn about the requirements for registering property, etc., with cost and estimated time to complete.

Transfer Tax Base

In the case Romulo D. San Juan vs. Ricardo L. Castro, in his capacity as City Treasurer of Marikina City [G.R. No. 174617 dated December 27, 2007], one of the issues was the proper
computation of the transfer tax base. In this case, petitioner San Juan conveyed real properties to a corporation in exchange for its shares of stock[1]. Using as basis Section 135 of the LGC, San
Juan wanted to pay the transfer tax based on the consideration stated in the Deed of Assignment. Respondent Castro, as the Treasurer, informed him that the tax due is based on the fair market
value of the property. Petitioner Castro protested the Treasurers computation in writing, which the Treasurer also denied in writing. Petitioner Castro then filed a Petition for mandamus and
damages against the Treasurer praying that he be compelled to accept payment of the transfer tax based on the actual consideration of the transfer/assignment.

The bone of contention was the proper interpretation of Section 135 of the LGC which provides:

SECTION 135. Tax on Transfer of Real Property Ownership. (a) The province may impose a tax on the sale, donation, barter, or on any other mode of transferring ownership or title of real
property at the rate of not more than fifty percent (50%) of the one percent (1%) of the total consideration involved in the acquisition of the property or of the fair market value in case the
monetary consideration involved in the transfer is not substantial, whichever is higher. The sale, transfer or other disposition of real property pursuant to R.A. No. 6657[2] shall be exempt from
this tax. xxx

Petitioner San Juan took the position that the transfer tax base should be the total consideration involved, because the intention of the law is not to automatically apply the whichever is higher
rule. He argued that it is only when there is a monetary consideration involved and the monetary consideration is not substantial that the tax rate is based on the higher fair market value. His
argument was that since he received shares of stock in exchange for the real properties, there was no monetary consideration involved in the transfer.
Respondent Castro, on the other hand, took the position that the transfer tax base should be the fair market value, because it is higher than the monetary consideration San Juan received in
exchange for his real properties. Castro argued that monetary consideration as used in the LGC does not only pertain to the price or money involved but also, as in the case of donations or
barters, to the value or monetary equivalent of what is received by the transferor, which, in this case, Castro argued to be the par value of the shares of stock San Juan transferred in exchange for
shares of stock.

As anticlimactic as this may sound, the Court did not rule squarely on the correct computation of the transfer tax base because it held that a Petition for Mandamus was not the correct remedy.
Mandamus lies only to compel an officer to perform a ministerial duty (one which is so clear and specific as to leave no room for the exercise of discretion in its performance) but not a
discretionary function (one which by its nature requires the exercise of judgment).

Sample Computation

Considering that there is still an issue as to the proper computation of the transfer tax base, I suggest that we not delve into the various interpretations of Section 135 of the LGC and simply
multiply the transfer tax rate by the higher amount between the consideration paid and the fair market value.

Lets take for example a residential condominium in Antipolo with a floor area of 50sqm and a Selling Price (SP) of Php2.0M. The existing market value as per Tax Declaration is currently at Php
1M.

Since SP is higher than the Market Value, we shall use SP to compute the transfer tax:

Antipolo City Transfer Tax Rate: 0.75% [that is, 75% of 1%]

Transfer Tax = 0.75% x 2,000,000 = Php15,000

What if you dont agree with the Treasurers computation?

Assuming you disagree with the tax assessment made by a local treasurer, you may file a written protest thereof pursuant to Section 195 of the LGC, which provides:

SECTION 195. Protest of Assessment. When the local treasurer or his duly authorized representative finds that the correct taxes, fees, or charges have not been paid, he shall issue a
notice of assessment stating the nature of the tax, fee, or charge, the amount of deficiency, the surcharges, interests and penalties. Within sixty (60) days from the receipt of the notice of
assessment, the taxpayer may file a written protest with the local treasurer contesting the assessment; otherwise, the assessment shall become final and executory. The local treasurer shall decide
the protest within sixty (60) days from the time of its filing. If the local treasurer finds the protest to be wholly or partly meritorious, he shall issue a notice cancelling wholly or partially the
assessment. However, if the local treasurer finds the assessment to be wholly or partly correct, he shall deny the protest wholly or partly with notice to the taxpayer. The taxpayer shall have thirty
(30) days from the receipt of the denial of the protest or from the lapse of the sixty-day (60) period prescribed herein within which to appeal with the court of competent jurisdiction, otherwise the
assessment becomes conclusive and unappealable.

In the case earlier discussed, the Petitioner protested in writing against the assessment and Respondent denied it in writing as well. Petitioner should thus have either: 1) appealed the assessment
before the court of competent jurisdiction, or 2) paid the tax and then sought a refund.

In my view, the Petitioner San Juan could have made another argument, that is, assuming that the monetary consideration would be equivalent to the par value of the stocks (which is still lower
than the fair market value), that value is substantial and thus, there is no need for the whichever is higher provision to kick in. Anyway, hopefully this issue would be decided upon squarely soon
as there are really a lot of tax-free exchanges occurring and we really need guidance on the computation of transfer tax. Perhaps one day a taxpayer and his tax attorneys may decide to bring this
issue up until the Supreme Court for a final decision.

Taking everything into consideration, personally, unless the difference in tax that you need to pay is really significant, it would be better to follow the computation of the Treasurer. Filing a case in
court would require filing fees and fees for tax attorneys, not to mention taking up much of your time. If you will not pay the transfer taxes, you cannot transfer the title to your name and this
would lead to problems with your buyer and the closing of your sale transaction. Weigh your options first before heading to battle. In real estate, as in everything, closing the deal fast is key.

A donatio mortis causa (Latin, meaning "gift on the occasion of death") is a gift made during the life of the donor which is conditional upon, and takes effect upon, death (in the United States, it
is often referred to as a gift causa mortis). It is separate and distinct from both a normal inter vivos gift, under which title passes immediately to the transferee, and from a testamentary gift, which
takes effect under the provisions of a properly executed will.

Where the subject matter is a chattel which has been delivered to the donee, the donee's title is complete on the donor's death, no further act being necessary. In the case of a chose in action or
land, the donee's title is not complete on the donor's death as the legal title vests in the donor's personal representatives. The donee can seek the assistance of the courts to compel the personal
representatives to do whatever is necessary to perfect the donee's title,[1] and this is one of relatively few exceptions to the equitable maxim that "equity will not assist a volunteer."

Inter vivos (Latin, between the living) is a legal term referring to a transfer or gift made during one's lifetime, as opposed to a testamentary transfer (a gift that takes effect on death).

The term is often used to describe a trust established during one's lifetime, i.e., an Inter vivos trust as opposed to a Testamentary trust which is established on one's death, usually as part of a
will. An Inter vivos trust is often used synonymously with the more common term Living trust, but an Inter vivos trust, by definition, includes both revocable and irrevocable trust.

The term inter vivos is also used to describe living organ donation, in which one patient donates an organ to another while both are alive. Generally, the organs transplanted are either non-vital
organs such as corneas or redundant vital organs such as one of the two kidneys or part of a liver.

Estate Tax is a tax on the right of the deceased person to transmit his/her estate to his/her lawful heirs and beneficiaries at the time of death and on certain transfers, which are made by law as
equivalent to testamentary disposition. It is not a tax on property. It is a tax imposed on the privilege of transmitting property upon the death of the owner. The Estate Tax is based on the laws
in force at the time of death notwithstanding the postponement of the actual possession or enjoyment of the estate by the beneficiary.

SEC. 84 Rates of Estate Tax. - There shall be levied, assessed, collected and paid upon the transfer of the net estate as determined in accordance with
Sections 85 and 86 of every decedent, whether resident or nonresident of the Philippines, a tax based on the value of such net estate, as computed in
accordance with the following schedule:

If the net estate is:

Over But Not Over The Tax shall be Plus Of the Excess Over
 P 200,000 Exempt

P 200,000 550,000 0 5% P 200,000

500,000 2,000,000 P 15,000 8% 500,000

2,000,000 5,000,000 135,000 11% 2,000,000

5,000,000 10,000,000 465,000 15% 5,000,000

10,000,000 And Over 1,215,000 20% 10,000,000

SEC. 85. Gross Estate. - 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 nonresident 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.

(A) Decedent's Interest. - To the extent of the interest therein of the decedent at the time of his death;

(B) Transfer in Contemplation of Death. - To the extent of any interest therein of which the decedent has at any time made a transfer, by trust or
otherwise, in contemplation of or intended to take effect in possession or enjoyment at or after death, or of which he has at any time made a transfer, by
trust or otherwise, under which he has retained for his life or for any period which does not in fact end before his death (1 ) the possession or enjoyment
of, or the right to the income from the property, or (2) the right, either alone or in conjunction with any person, to designate the person who shall possess
or enjoy the property or the income therefrom; except in case of a bonafide sale for an adequate and full consideration in money or money's worth.

(C) Revocable Transfer. -

(1) To the extent of any interest therein, of which the decedent has at any time made a transfer (except in case of a bona fide sale for an
adequate and full consideration in money or money's worth) by trust or otherwise, where the enjoyment thereof was subject at the date of his
death to any change through the exercise of a power (in whatever capacity exerciseable) by the decedent alone or by the decedent in
conjunction with any other person (without regard to when or from what source the decedent acquired such power), t o alter, amend, revoke, or
terminate, or where any such power is relinquished in contemplation of the decedent's death.

(2) For the purpose of this Subsection, the power to alter, amend or revoke shall be considered to exist on the date of the decedent's death
even though the exercise of the power is subject to a precedent giving of notice or even though the alteration, amendment or revocation takes
effect only on the expiration of a stated period after the exercise of the power, whether or not on or before the date of the decedent's death
notice has been given or the power has been exercised. In such cases, proper adjustment shall be made representing the interests which would
have been excluded from the power if the decedent had lived, and for such purpose if the notice has not been given or the power has not been
exercised on or before the date of his
death, such notice shall be considered to have been given, or the power exercised, on the date of his death.

(D) Property Passing Under General Power of Appointment. - To the extent of any property passing under a general power of appointment
exercised by the decedent: (1) by will, or (2) by deed executed in contemplation of, or intended to take effect in possession or enjoyment at, or after his
death, or (3) by deed under which he has retained for his life or any period not ascertainable without reference to his death or for any period which does
not in fact end before his death (a) the possession or enjoyment of, or the right to the income from, the property, or (b) the right, either alone or in
conjunction with any person, to designate the persons who shall possess or enjoy the property or the income therefrom; except in case of a bona fide sale
for an adequate and full consideration in money or money's worth.

(E) Proceeds of Life Insurance. - To the extent of 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.

(F) Prior Interests. - Except as otherwise specifically provided therein, Subsections (B), (C) and (E) of this Section shall apply to the transfers, trusts,
estates, interests, rights, powers and relinquishment of powers, as severally enumerated and described therein, whether made, created, arising, existing,
exercised or relinquished before or after the effectivity of this Code.

(G) Transfers of Insufficient Consideration. - If any one of the transfers, trusts, interests, rights or powers enumerated and described in Subsections
(B), (C) and (D) of this Section 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.

(H) Capital of the Surviving Spouse. - The capital of the surviving spouse of a decedent shall not, for the purpose of this Chapter, be deemed a part of
his or her gross estate.

SEC. 86. Computation of Net Estate. - For the purpose of the tax imposed in this Chapter, the value of the net estate shall be determined:

(A) Deductions Allowed to the Estate of Citizen or a Resident. - In the case of a citizen or resident of the Philippines, by deducting from the value of
the gross estate -

(1) Expenses, Losses, Indebtedness, and taxes. - Such amounts -

 (a) 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);

(b) For judicial expenses of the testamentary or intestate proceedings;

(c) For claims against the estate: Provided, That at the time the indebtedness was incurred the debt instrument was duly notarized
and, if the loan was contracted within three (3) years before the death of the decedent, the administrator or executor shall submit a
statement showing the disposition of the proceeds of the loan;

(d) For claims of the deceased against insolvent persons where the value of decedent's interest therein is included in the va lue of the
gross estate; and

(e) For unpaid mortgages upon, or any indebtedness in respect to, property where the value of decedent's interest therein,
undiminished by such mortgage or indebtedness, is included in the value of the gross estate, but not including any income tax upon
income received after the death of the decedent, or property taxes not accrued before his death, or any estate tax. The deduction
herein allowed in the case of claims against the estate, unpaid mortgages or any indebtedness shall, when founded upon a promise or
agreement, be limited to the extent that they were contracted bona fide and for an adequate and full consideration in money or
money's worth. There shall also be deducted losses incurred during the settlement of the estate arising from fires, storms, shipwreck,
or other casualties, or from robbery, theft or embezzlement, when such losses are not compensated for by insurance or otherwise,
and if at the time of the filing of the return such losses have not been claimed as a deduction for the income tax purposes in an
income tax return, and provided that such losses were incurred not later than the last day for the payment of the estate tax as
prescribed in Subsection (A) of Section 91.

(2) Property Previously Taxed. - An amount equal to the value specified below of any property forming a part of the gross estate situated in the
Philippines of any person who died within five (5) years prior to the death of the decedent, or transferred to the decedent by gift within five (5)
years prior to his death, where such property can be identified as having been received by the decedent from the donor by gift, or from such
prior decedent by gift, bequest, devise or inheritance, or which can be identified as having been acquired in exchange for property so received:

One hundred percent (100%) of the value, if the prior decedent died within one (1) year prior to the death of the decedent, or if the property
was transferred to him by gift within the same period prior to his death;

Eighty percent (80%) of the value, if the prior decedent died more than one (1) year but not more than two (2) years prior to the death of the
decedent, or if the property was transferred to him by gift within the same period prior to his death;

Sixty percent (60%) of the value, if the prior decedent died more than two (2) years but not more than three (3) years prior to the death of the
decedent, or if the property was transferred to him by gift within the same period prior to his death;

Forty percent (40%) of the value, if the prior decedent died more than three (3) years but not more than four (4) years prior to the death of the
decedent, or if the property was transferred to him by gift within the same period prior to his death;

Twenty percent (20%) of the value, if the prior decedent died more than four (4) years but not more than five (5) years prior to the death of
the decedent, or if the property was transferred to him by gift within the same period prior to his death;

These deductions shall be allowed only where a donor's tax or estate tax imposed under this Title was finally determined and paid by or on
behalf of such donor, or the estate of such prior decedent, as the case may be, and only in the amount finally determined as the value of such
property in determining the value of the gift, or the gross estate of such prior decedent, and only to the extent that the value of such property is
included in the decedent's gross estate, and only if in determining the value of the estate of the prior decedent, no deduction was allowable
under paragraph (2) in respect of the property or properties given in exchange therefor. Where a deduction was allowed of any mortgage or
other lien in determining the donor's tax, or the estate tax of the prior decedent, which was paid in whole or in part prior to the decedent's
death, then the deduction allowable under said Subsection shall be reduced by the amount so paid. Such deduction allowable shall be reduced
by an amount which bears the same ratio to the amounts allowed as deductions under paragraphs (1) and (3) of this Subsection as the amount
otherwise deductible under said paragraph (2) bears to the value of the decedent's estate. Where the property referred to consists of two or
more items, the aggregate value of such items shall be used for the purpose of computing the deduction.

(3) Transfers for Public Use. - The amount of all the bequests, legacies, devises or transfers to or for the use of the Government of the Republic
of the Philippines, or any political subdivision thereof, for exclusively public purposes.

(4) The Family Home. - An amount equivalent to the current fair market value of the decedent's family home: Provided, however, That if the
said current fair market value exceeds One million pesos (P1,000,000), the excess shall be subject to estate tax. As a sine qua non condition for
the exemption or deduction, said family home must have been the decedent's family home as certified by the barangay captain of the locality.

(5) Standard Deduction. - An amount equivalent to One million pesos (P1,000,000).

(6) 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).

(7) 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.

(B) Deductions Allowed to Nonresident Estates. - In the case of a nonresident not a citizen of the Philippines, by deducting from the value of that
part of his gross estate which at the time of his death is situated in the Philippines:
(1) Expenses, Losses, Indebtedness and Taxes. - That proportion of the deductions specified in paragraph (1) of Subsection (A) of this Section
which the value of such part bears to the value of his entire gross estate wherever situated;

(2) Property Previously Taxed. - An amount equal to the value specified below of any property forming part of the gross estate situated in the
Philippines of any person who died within five (5) years prior to the death of the decedent, or transferred to the decedent by gift within five (5)
years prior to his death, where such property can be identified as having been received by the decedent from the donor by gift, or from such
prior decedent by gift, bequest, devise or inheritance, or which can be identified as having been acquired in exchange for property so received:

One hundred percent (100%) of the value if the prior decedent died within one (1) year prior to the death of the decedent, or if the property
was transferred to him by gift, within the same period prior to his death;
 Eighty percent (80%) of the value, if the prior decedent died more than one (1) year but not more than two (2) years prior to the death of the
decedent, or if the property was transferred to him by gift within the same period prior to his death;

Sixty percent (60%) of the value, if the prior decedent died more than two (2) years but not more than three (3) years prior to the death of the
decedent, or if the property was transferred to him by gift within the same period prior to his death;

Forty percent (40%) of the value, if the prior decedent died more than three (3) years but not more than four (4) years prior to the death of the
decedent, or if the property was transferred to him by gift within the same period prior to his death; and

Twenty percent (20%) of the value, if the prior decedent died more than four (4) years but not more than five (5) years prior to the death of
the decedent, or if the property was transferred to him by gift within the same period prior to his death.

These deductions shall be allowed only where a donor's tax, or estate tax imposed under this Title is finally determined and paid by or on behalf
of such donor, or the estate of such prior decedent, as the case may be, and only in the amount finally determined as the value of such property
in determining the value of the gift, or the gross estate of such prior decedent, and only to the extent that the value of such property is included
in that part of the decedent's gross estate which at the time of his death is situated in the Philippines; and only if, in determining the value of
the net estate of the prior decedent, no deduction is allowable under paragraph (2) of Subsection (B) of this Section, in respect of the property
or properties given in exchange therefore. Where a deduction was allowed of any mortgage or other lien in determining the donor's tax, or the
estate tax of the prior decedent, which was paid in whole or in part prior to the decedent's death, then the deduction allowable under said
paragraph shall be reduced by the amount so paid. Such deduction allowable shall be reduced by an amount which bears the same ratio to the
amounts allowed as deductions under paragraphs (1) and (3) of this Subsection as the amount otherwise deductible under paragraph (2) bears
to the value of that part of the decedent's gross estate which at the time of his death is situated in the Philippines. Where the property referred
to consists of two (2) or more items, the aggregate value of such items shall be used for the purpose of computing the deduction.

(3) Transfers for Public Use. - The amount of all bequests, legacies, devises or transfers to or for the use of the Government of the Republic of
the Philippines or any political subdivision thereof, for exclusively public purposes.

(C) Share in the Conjugal Property. - the net share of the surviving spouse in the conjugal partnership property as diminished by the obligations
properly chargeable to such property shall, for the purpose of this Section, be deducted from the net estate of the decedent.

(D) Miscellaneous Provisions. - No deduction shall be allowed in the case of a nonresident not a citizen of the Philippines, unless the executor,
administrator, or anyone of the heirs, as the case may be, includes in the return required to be filed under Section 90 the value at the time of his death of
that part of the gross estate of the nonresident not situated in the Philippines.

(E) Tax Credit for Estate Taxes paid to a Foreign Country. -

(1) In General. - The tax imposed by this Title shall be credited with the amounts of any estate tax imposed by the authority of a foreign
country.

(2) Limitations on Credit. - The amount of the credit taken under this Section shall be subject to each of the following limitations:

(a) The amount of the credit in respect to the tax paid to any country shall not exceed the same proportion of the tax against which
such credit is taken, which the decedent's net estate situated within such country taxable under this Title bears to his entir net estate;
and

(b) The total amount of the credit shall not exceed the same proportion of the tax against which such credit is taken, which the
decedent's net estate situated outside the Philippines taxable under this Title bears to his entire net estate.

SEC. 87 Exemption of Certain Acquisitions and Transmissions. - The following shall not be taxed:

(A) The merger of usufruct in the owner of the naked title;

(B) The transmission or delivery of the inheritance or legacy by 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; and

(D) All bequests, devises, legacies or transfers to social welfare, cultural and charitable institutions, no part of the net income of which insures
to the benefit of any individual: Provided, however, That not more than thirty percent (30%) of the said bequests, devises, legacies or transfers
shall be used by such institutions for administration purposes.

SEC. 88. Determination of the Value of the Estate. -

(A) Usufruct. - To determine the value of the right of usufruct, use or habitation, as well as that of 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 recommendation of the Insurance Commissioner.

(B) Properties. - The estate shall be appraised at its fair market value as of the time of death. However, the appraised value of real property
as of the time of death shall be, whichever is higher of -

(1) The fair market value as determined by the Commissioner, or

(2) The fair market value as shown in the schedule of values fixed by the Provincial and City Assessors.
SEC. 89. Notice of Death to be Filed. - In all cases of transfers subject to tax, or where, though exempt from tax, the gross value of the estate exceeds
Twenty thousand pesos (P20,000), the executor, administrator or any of the legal heirs, as the case may be, within two (2) months after the decedent's
death, or within a like period after qualifying as such executor or administrator, shall give a written notice thereof to the Commissioner.

SEC. 90. Estate Tax Returns. -

(A) Requirements. - In all cases of transfers subject to the tax imposed herein, or where, though exempt from tax, the gross value of the estate
exceeds Two hundred thousand pesos (P200,000), or regardless of the gross value of the estate, where the said estate consists of registered or
registrable property such as real property, motor vehicle, shares of stock or other similar property for which a clearance fr om the Bureau of Internal
Revenue is required as a condition precedent for the transfer of ownership thereof in the name of the transferee, the executor, or the administrator, or
any of the legal heirs, as the case may be, shall file a return under oath in duplicate, setting forth:

(1) The value of the gross estate of the decedent at the time of his death, or in case of a nonresident, not a citizen of the Philippines, of that
part of his gross estate situated in the Philippines;

(2) The deductions allowed from gross estate in determining the estate as defined in Section 86; and

(3) Such part of such information as may at the time be ascertainable and such supplemental data as may be necessary to establish the correct
taxes.

Provided, however, That estate tax returns showing a gross value exceeding Two million pesos (P2,000,000) shall be supported with a
statement duly certified to by a Certified Public Accountant containing the following:

(a) Itemized assets of the decedent with their corresponding gross value at the time of his death, or in the case of a nonresident, not
a citizen of the Philippines, of that part of his gross estate situated in the Philippines;

(b) Itemized deductions from gross estate allowed in Section 86; and

(c) The amount of tax due whether paid or still due and outstanding.

(B) Time for filing. - For the purpose of determining the estate tax provided for in Section 84 of this Code, the estate tax return required under the
preceding Subsection (A) shall be filed within six (6) months from the decedent's death.

A certified copy of the schedule of partition and the order of the court approving the same shall be furnished the Commissioner within thirty (30) after the
promulgation of such order.

(C) Extension of Time. - The Commissioner shall have authority to grant, in meritorious cases, a reasonable extension not exceeding thirty (30) days for
filing the return.

(D) Place of Filing. - Except in cases where the Commissioner otherwise permits, the return required under Subsection (A) shall be filed with an
authorized agent bank, or Revenue District Officer, Collection Officer, or duly authorized Treasurer of the city or municipality in which the decedent was
domiciled at the time of his death or if there be no legal residence in the Philippines, with the Office of the Commissioner.

SEC. 91. Payment of Tax. -

(A) Time of Payment. - The estate tax imposed by Section 84 shall be paid at the time the return is filed by the executor, administrator or the heirs.

(B) Extension of Time. - When the Commissioner finds that the payment on the due date of the estate tax or of any part thereof would impose undue
hardship upon the estate or any of the heirs, he may extend the time for payment of such tax or any part thereof not to exceed five (5) years, in case the
estate is settled through the courts, or two (2) years in case the estate is settled extrajudicially. In such case, the amount in respect of which the
extension is granted shall be paid on or before the date of the expiration of the period of the extension, and the running of the Statute of Limitations for
assessment as provided in Section 203 of this Code shall be suspended for the period of any such extension.

Where the taxes are assessed by reason of negligence, intentional disregard of rules and regulations, or fraud on the part of the taxpayer, no extension
will be granted by the Commissioner.

If an extension is granted, the Commissioner may require the executor, or administrator, or beneficiary, as the case may be, to furnish a bond in such
amount, not exceeding double the amount of the tax and with such sureties as the Commissioner deems necessary, conditioned upon the payment of the
said tax in accordance with the terms of the extension.

(C) Liability for Payment - The estate tax imposed by Section 84 shall be paid by the executor or administrator before delivery to any beneficiary of his
distributive share of the estate. Such beneficiary shall to the extent of his distributive share of the estate, be subsidiarily liable for the payment of such
portion of the estate tax as his distributive share bears to the value of the total net estate.

For the purpose of this Chapter, the term 'executor' or 'administrator' means the executor or administrator of the decedent, or if there is no executor or
administrator appointed, qualified, and acting within the Philippines, then any person in actual or constructive possession of any property of the decedent.
SEC. 92. Discharge of Executor or Administrator from Personal Liability. - If the executor or administrator makes a written application to the
Commissioner for determination of the amount of the estate tax and discharge from personal liability therefore, the Commissioner (as soon as possible,
and in any event within one (1) year after the making of such application, or if the application is made before the return is filed, then within one (1) year
after the return is filed, but not after the expiration of the period prescribed for the assessment of the tax in Section 203 shall not notify the executor or
administrator of the amount of the tax. The executor or administrator, upon payment of the amount of which he is notified, shall be discharged from
personal liability for any deficiency in the tax thereafter found to be due and shall be entitled to a receipt or writing showing such discharge.

SEC. 93. Definition of Deficiency. - As used in this Chapter, the term 'deficiency' means:

(a) The amount by which the tax imposed by this Chapter exceeds the amount shown as the tax by the executor, administrator or any of the heirs upon
his return; but the amounts so shown on the return shall first be increased by the amounts previously assessed (or collected without assessment) as a
deficiency and decreased by the amount previously abated, refunded or otherwise repaid in respect of such tax; or

(b) If no amount is shown as the tax by the executor, administrator or any of the heirs upon his return, or if no return is made by the executor,
administrator, or any heir, then the amount by which the tax exceeds the amounts previously assessed (or collected without assessment) as a deficiency;
but such amounts previously assessed or collected without assessment shall first be decreased by the amounts previously abated, refunded or otherwise
repaid in respect of such tax.

SEC. 94. Payment before Delivery by Executor or Administrator. - 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 Commissioner that the estate tax has been paid is shown.

SEC. 95. Duties of Certain Officers and Debtors. - Registers of Deeds shall not register in the Registry of Property any document transferring real
property or real rights therein or any chattel mortgage, by way of gifts inter vivos or mortis causa, legacy or inheritance, unless a certification from the
Commissioner that the tax fixed in this Title and actually due thereon had been paid is show, and they shall immediately notify the Commissioner,
Regional Director, Revenue District Officer, or Revenue Collection Officer or Treasurer of the city or municipality where their offices are located, of the non
payment of the 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 donation intervivos or mortis causa, legacy or inheritance, shall have the
duty of furnishing the Commissioner, Regional Director, Revenue District Officer or Revenue Collection Officer of the place where he may have his principal
office, with copies of such documents and any information whatsoever which may facilitate the collection of the aforementioned tax. Neither shall a debtor
of the deceased pay his debts to the heirs, legatee, executor or administrator of his creditor, unless the certification of the Commissioner that the tax fixed
in this Chapter had been paid is shown; but he may pay the executor or judicial administrator without said certification if the credit is included in the
inventory of the estate of the deceased.

SEC. 96. Restitution of Tax Upon Satisfaction of Outstanding Obligations. - If after the payment of the estate tax, new obligations of the decedent
shall appear, and the persons interested shall have satisfied them by order of the court, they shall have a right to the restitution of the proportional part of
the tax paid.

SEC. 97. Payment of Tax Antecedent to the Transfer of Shares, Bonds or Rights. - 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 a certification from the Commissioner that the taxes fixed in this Title and due thereon
have been paid is shown.

If a bank has knowledge of the death of a person, who maintained a bank deposit account alone, or jointly with another, it shall not allow any withdrawal
from the said deposit account, unless the Commissioner has certified that the taxes imposed thereon by this Title have been paid: Provided, however,
That the administrator of the estate or any one (1) of the heirs of the decedent may, upon authorization by the Commissioner, withdraw an amount not
exceeding Twenty thousand pesos (P20,000) without the said certification. For this purpose, all withdrawal slips shall contain a statement to the effect
that all of the joint depositors are still living at the time of withdrawal by any one of the joint depositors and such statement shall be under oath by the
said depositors.

Donors Tax is a tax on a donation or gift, and is imposed on the gratuitous transfer of property between two or more persons who are living at the time of the transfer. It shall apply whether
the transfer is in trust or otherwise, whether the gift is direct or indirect and whether the property is real or personal, tangible or intangible.