TAXATION | ESTATE TAX

ESTATE TAX

A. ESTATE TAX

1. Taxpayer and Tax Base

The estate tax is imposed on the transfer of the decedent’s estate to his lawful heirs and beneficiaries
based on the fair market value of the net estate at the time of the decedent’s death. 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.

2. Computation of Net Estate

a. Gross estate - The value of the gross estate of the decedent includes the value at the time of his
death of all property, real or personal, tangible or intangible, wherever situated.

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 situated in the Philippines is included in the taxable estate.1

Gross estate includes property falling under any of the following categories:

(1) Decedent’s interest, to the extent of his interest therein at the time of his death;
(2) Transfers in contemplation of death;
(3) Revocable transfers;
(4) Property passing under general power of appointment;
(5) Proceeds of life insurance;
(6) Prior interests; and
(7) Transfer for insufficient consideration.

The following are excluded from the gross estate:

(1) GSIS proceeds/ benefits

(2) Accruals from SSS
(3) Proceeds of life insurance where the beneficiary is irrevocably appointed
(4) Proceeds of life insurance under a group insurance taken by employer (not taken out upon his life)
(5) War damage payments
(6) Transfer by way of bona fide sales
(7) Transfer of property to the National Government or to any of its political subdivisions
(8) Separate property of the surviving spouse
(9) Merger of usufruct in the owner of the naked title
(10) Properties held in trust by the decedent
(11) Acquisition and/or transfer expressly declared as not taxable

1
No estate tax shall be collected in respect of intangible personal property if (a) the decedent at the time of death was a citizen and resident of
a foreign country which did not impose a transfer tax of any character, in respect of intangible personal property of citizens of the Philippines not
residing in that foreign country; or (b) if the laws of the foreign country of which the decedent was a citizen or resident allows a similar exemption
from transfer or death taxes of every character in respect of intangible personal property owned by citizens of the Philippines not residing in that
foreign country. (Sec. 104, NIRC).
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(12) Personal Equity and Retirement Account (PERA) assets of the decedent-contributor.2

b. Net estate

The net estate is determined by deducting from the value3 of gross estate the total amount of allowable
deductions.

c. Deductions

(1) In the case of citizens or residents of the Philippines:

(a) Expenses, losses, indebtedness, and taxes consisting of;

(i) Actual funeral expenses or five percent (5%) of the gross estate, whichever is lower, but not
exceeding Two Hundred Thousand Pesos (PhP200,000.00)4;
(ii) Judicial expenses of the testamentary or intestate proceedings5;
(iii) Claims against the estate;
(iv) Claims of the deceased against insolvent persons where the value of such claim is included in
the value of the gross estate;
(v) Unpaid mortgages in favor of the estate, under certain conditions;
(vi) Unpaid taxes; and
(vii) Casualty losses.
(b) Value of property previously taxed (estate or donor’s tax), under certain conditions.
(c) Transfers to or for the use of the Philippine Government or any political subdivision thereof,
exclusively for public purposes.
(d) Current fair market value of the decedent’s family home. If the said current fair market value
exceeds One Million Pesos (PhP1,000,000)6, the excess shall be subject to estate tax. Also, said family
home must have been the decedent’s family home as certified by the barangay captain of the locality.
(e) Standard deduction equivalent to One Million Pesos (PhP1,000,000)7.
(f) Medical expenses not exceeding Five Hundred Thousand Pesos (PhP500,000.00), incurred by the
decedent within one year prior to his death, duly substantiated with receipts8.
(g) Amount received by heirs under RA 49179 (retirement benefits of employees of private firms)
provided such amount is included in the gross estate of the deceased.
(h) The net share of the surviving spouse in the conjugal partnership property.

(2) In the case of a nonresident not a citizen of the Philippines

2
Section 14, RA 9505 or the “Personal Equity and Retirement Account (PERA) Act of 2008”
3
The computation for estate tax purposes of real properties shall be based on the zonal value or the value as shown
in the schedule of market values prepared by the Provincial or City Assessors whichever is higher. See Sec. 88(b),
supra.
4
Under TRAIN Act, this deduction has been removed and no longer allowed
5
Under TRAIN Act, this deduction has been removed and no longer allowed
6
Under TRAIN Act, the family home deduction limit of P1,000,000 is increased to P10,000,000
7
Under TRAIN Act, the standard deduction of P1,000,000 is increased to P5,000,000
8
Under TRAIN Act, this deduction has been removed and no longer allowed
9
An Act Providing that Retirement Benefits of Employees of Private Firms Shall Not Be Subject to Attachment,
Levy, Execution, or Any Tax Whatsoever
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(a) That portion of the funeral expenses, losses and indebtedness, and taxes which the value of the
decedent’s gross estate situated in the Philippines bears to his entire gross estate wherever situated10;
(b) Value of property previously taxed, under certain conditions, if part of decedent’s gross estate is
situated in the Philippines;
(c) Transfers to or for the use of the Philippine Government or any political subdivision thereof,
exclusively for public purposes; and
(d) The net share of the surviving spouse in the conjugal partnership property as diminished by the
obligations properly chargeable to such property

Section 86 (D) of this Tax Code, provides that there shall be no deduction allowed in the case of a non-
resident 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 the Section 90 the value at the time of
his death of that part of the gross estate of the non-resident not situated in the Philippines.11

d. Exemptions

The following shall not be taxed:

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

(2) The transmission or delivery of the inheritance or legacy by the fiduciary heir or legatee to the
fideicommissary;
(3) The transmission from the first heir, legatee, or donee in favor of another beneficiary, in accordance
with the desire of the predecessor; and
(4) All bequests, devises, legacies or transfers to social welfare cultural or charitable institutions, no part
of the net income of which inures to the benefit of any individual, provided that not more than 30% of
said bequests, devises, legacies or transfers shall be used for administration purposes.

3. Rates of Estate Tax12

10
Under TRAIN Act, funeral and judicial expenses are removed
11
Under TRAIN Act, this miscellaneous provision has been removed.
12
Under TRAIN ACT, the Estate Tax rate is fixed at 6% based on the value of the net estate.
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4. Filing Requirements and Payment of Tax13

a. Persons required to file notice of death

A written notice of death to the Commissioner of Internal Revenue shall be filed by 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, in all cases of transfers
subject to tax, or where, though exempt from tax, the gross value of the estate exceeds Twenty
Thousand Pesos (PhP20,000)14.

b. Persons required to file estate tax returns

The estate tax return shall be filed by the executor or administrator, or any of the legal heirs, in cases of
transfers subject to estate tax, or where though exempt from estate tax, the gross value of the estate
exceeds Two Hundred Thousand Pesos (PhP200,000.00) 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 from the BIR is required as a condition
precedent for the transfer of ownership thereof in the name of the transferee. In case the estate tax
return shows a gross value exceeding Two Million Pesos (PhP2,000,000)15 it must be supported with a
statement certified to by a Certified Public Accountant.

c. Time of filing

The estate tax return shall be filed within six (6) months from the decedent’s death16. The Commissioner
shall have the authority to grant, in meritorious cases a reasonable extension not exceeding thirty (30)
days for filing the return.

d. Place of filing

The return shall be filed with an authorized agent bank, Revenue Collection Officer or duly authorized
Treasurer of the City or municipality in the Revenue District Office having jurisdiction over the place of
domicile of the decedent at the time of his death. In case of a non-resident decedent, with executor or
administrator in the Philippines, the estate tax return shall be filed with the AAB of the RDO where such
executor/administrator is registered or is domiciled, if not yet registered with the BIR. For non-resident

13
In the case of the heirs of deceased landowners of agrarian reform-covered lands, the Land Bank of the
Philippines (LBP) upon receipt of the heirs’ undertaking to pay the estate and real property taxes shall deduct the
said taxes from the landowner’s compensation and remit the same immediately to the BIR and the LGUs
concerned. The BIR shall then issue the necessary clearance for the registration of document transmitting
ownership of landowner’s compensation to the heir/s. This policy, however, shall not apply if there is a pending
just compensation case filed by the heirs of the deceased landowner before the Department of Agrarian Reform
Adjudication Board (DARAB), Special Agrarian Court or a higher court having jurisdiction. [Joint Department of
Agrarian Reform (DAR)-Department of Finance (DOF)-Department of Justice (DOJ)- LBP Administrative Order (AO)
No. 1, Series of 2012 dated April 18, 2013] as clarified under RMC 77-2015 issued on December 17, 2015.
14
Under TRAIN Act, the requirement for filing of notice of death is removed
15
Under TRAIN Act, the threshold amount of P2,000,000 has been increased to P5,000,000
16
Under TRAIN Act, the filing of estate tax returns shall be within one (1) year from the decedent’s death.
TAXATION | ESTATE TAX

decedent with no executor or administrator in the Philippines, the estate tax return shall be filed with
the AAB under the jurisdiction of RDO 39–South Quezon City.17

e. Payment of tax

The estate tax shall be paid at the time the return is filed by the executor, administrator or the heirs. The
Commissioner may grant extension of time not exceeding five (5) or two (2) years depending on
whether the estate was settled judicially or extrajudicially. In case the available cash of the estate is not
sufficient to pay its total estate tax liability, the estate may be allowed to pay the tax by installment and
a clearance shall be released only with respect to the property the corresponding/computed tax on
which has been paid. There shall, therefore, be as many clearances (Certificate Authorizing Registration)
as there are as many properties released because they have been paid for by the installment payments
of the estate tax. The computation of the estate tax, however, shall always be on the cumulative
amount of the net taxable estate. Any amount paid after the statutory due date of the tax shall be
imposed the corresponding applicable penalty thereto. However, if the payment of the tax after the due
date is approved by the Commissioner or his duly authorized representative, the imposable penalty
thereon shall only be the interest.

Under TRAIN Act, there shall be a provision under Section 91 (c) of the Tax Code, which states that in
case the available cash of the estate is insufficient to pay the total estate tax due, payment by
installment shall be allowed within two (2) years from the statutory date of payments, without civil
penalty and interest.

Section 97 of the Tax Code, provides that 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 have
been paid18.

f. Penalties

Violations of the estate tax provisions are subject to the applicable common penalties prescribed under
Title X (Statutory Offenses and Penalties) of the NIRC, as amended.

QUIZZERS

1. It refers to a mode of transferring & acquiring properties left by the decedent.

a. Estate transfer c. Donation
b. Succession d. Execution of a will

2. The property, rights & obligations of a person which are not extinguished by his death & those which
have accrued thereto since the opening of succession.
a. Inheritance c. Estate
b. Capital d. Devisee

17
RMC 34-2013, Clarification on the Proper Accomplishment and Filing of Estate Tax Returns, dated April 22, 2013.
18
Under TRAIN Act, If a bank has knowledge of the death of a person, who maintained a bank deposit account
alone, or jointly with another, it shall allow any withdrawal from the said deposit account, subject to a final
withholding tax of (6%).
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3. The estate tax accrues from the moment of:

a. The fixing of notice of death
b. Expiration of a months after death
c. The death of the decedent
d. The filing of estate tax return

4. The gift tax paid on a donation mortis causa, if any:

a. Exempts the property from estate tax.
b. Has no effect since the gift will be subject to another gift tax.
c. Shall form as a tax credit to be deducted from the estate tax due.
d. Is invalid & the tax will not be credited at all.

5. Which shall not form part of the gross estate of a decedent:

a. Intangible personal property of non-resident alien decedent without reciprocity law
b. Revocable transfer
c. Transfer passing special power of appointment
d. Life insurance where the executor is the beneficiary & it is irrevocable

6. All of the following are considered intangible in the Philippines, except:

a. Franchise which must be exercised in the Phil.
b. Shares obligations or bonds which issued by any corporation or sociedad anonym organized or
constituted in the Philippines in accordance with it laws.
c. Shares, obligations or bonds by any foreign corporation 75%.of the business of which is located
in the Philippines.
d. Shares, obligations of bonds issued by any foreign corporation of such shares, obligations or
bonds have acquired a business situs in the Philippines.
e. Shares or rights in any partnership, business or industry established in the Philippines.

7. A person who inherits personal property thru a will:

a. Devisee c. Heir
b. Legatee d. Successor

8. A person who inherits real property thru a will:

a. Devisee c. Heir
b. Legatee d. Successor

9. Succession wherein the decedent did not leave any will:

a. Voluntary succession c. Mixed succession
b. Legal succession d. Testamentary succession

10. Which statement is false about succession:

a. The successor inherits all the transmissible property of a decedent including his liabilities.
b. The successor can be made liable for the obligations of the decedent beyond the value of the
asset he received.
c. In succession, fruits and credits maturing after the death of the decedent pass to the heirs even
if they were not subjected to estate tax.
d. In succession, the successor can refuse the inheritance.

11. One of statement is false:

a. Estate tax is an excise tax.
b. Estate tax is transfer tax on donation mortis causa.
c. The object of estate tax is to tax the transfer of the property from the dead to the living.
d. Estate tax and inheritance tax are the same.

12. Which statement is wrong:

a. Claims against insolvent person should be included in the gross estate even if uncollectible.
b. Transfer passing under special power of appointment is excluded from the gross estate.
c. Revocable transfers are includible whether or not the right to revoke is exercised.
d. Transfer contemplation of death for adequate consideration is still includible in the gross estate.
TAXATION | ESTATE TAX

13. Which statement is incorrect about funeral expenses allowed:

a. The amount allowed is 5% of the gross estate or the actual expenses which ever is lower.
b. The actual expenses must be paid from the estate or chargeable to it.
c. The allowed deduction can never be more than the actual expenses paid.
d. The expenses necessary for burial even if paid by friends are also allowed as deduction.

14. Which statement is incorrect about claims against insolvent persons?

a. They must be included in the gross estate even if uncollectible.
b. They must be duly notarized.
c. The deduction is only the uncollectible portion.
d. The insolvency of the debtor must be established.

15. One of the following is incorrect:

a. Taxes to be deductible must accrue before the decedent’s death.
b. Losses must occur also before the decedent’s death to be deductible.
c. Medical Expenses must be incurred within 1 year prior to the decedent’s death.
d. Transfer for public purposes order to be deducted must be mortis causa in character.

16. Which statement is false about vanishing deduction:

a. It pertains to a property presently found in the gross estate.
b. The property must be previously subjected to a transfer tax or income tax.
c. The property was received by the decedent within 5 years prior to his death.
d. The property must be located in the Philippines.

17. A donation inter vivos but due to thought of death is;

a. Subject to donor’s tax
b. Subject to estate tax if for inadequate consideration
c. Subject to estate tax a bonafide transfer
d. Subject to inheritance tax

18. In filing the estate tax return , a CPA certificate is required when:
a. Gross estate exceeds P2,000,000
b. Gross estate reaches P20,000
c. Gross estate exceeds P200,000
d. Gross estate reaches P2,000,000

19. A died leaving a house and lot to B March 31, 2014 which was questioned by C and it is under
litigation but the parties have stated an extra-judicial settlement. The last day for filing the estate
tax return is
a. April 30, 2015 c. September 30, 2014
b. April 30, 2018 d. October 30, 2014

20. The last day for the payment of estate tax may be extended, until;
a. March 21, 2028 c. September 30, 2020
b. September 30, 2016 d. April 30, 2018

21. The taxpayer in estate tax is:

a. The decedent
b. The estate as a juridical entity
c. The heirs or succession
d. The administrator or executor

22. The payment of estate tax is a personal liability of

a. The heirs or successors
b. The administrator in testamentary succession
c. The executor in voluntary succession
d. The estate itself
23. 1st statement: The court may authorize the executor or administrator to distribute the estate if in
its sound discretion it believes that the heir badly needs his share.
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2nd statement: The administrator or any of the heirs may however upon authorization of BIR
withdraw from the decedent’s bank up to P50,000 even without required certification that the estate
tax has been paid.
a. True, True c. True, False
b. False, False d. False, True

24. 1st statement: A died giving B power to appoint a person who will inherit A’s house and lot. B,
however can only choose among C, D and F. B decided to transfer the property to C, in B’s will
when he was old already. The transfer from B to C is subject to estate tax.
2nd statement: During A’s lifetime, he decided to give B as gift his (A) car subject to the condition
that if B does not become a CPA within 3 years. A shall revoke the transfer. In the second year
however, A died. The carshould form part of A’s gross estate.
a. True, True c. True, False
b. False, False d. False, True

25. A died leaving a farm land, In his will, he transferred the ownership thereof to B but subject to the
condition that C will have the right to use the land for a period of ten years (Usufruct) in the seventh
year, however, C died and C’s will be surrendered his over the land to B.
a. The transfer is subject to donor’s tax
b. The transfer is subject to estate tax
c. The transfer is both an inclusion and exclusion from the gross estate
d. The above is a tax-exempt transfer.

26. The notice of death must be filed when:

a. Gross estate exceeds P200,000
b. Gross estate exceeds P20,000
c. Gross estate reaches P200,000
d. Gross estate reaches P2,000,000

27. One of the following is not an exemption or exclusion from the gross estate:
a. Capital or exclusive of the surviving spouse
b. Properties outside the Philippines of non-resident Chinese decedent
c. Shares of stocks of San Miguel Corporation of a non-resident Mexican.
d. The merger of usufruct in the owner of the naked title

Questions 28 through 31 are based on the following information:

A decedent left the following properties:
Land in Italy (with P1M unpaid mortgage) P2,000,000
Land in DavaoCity, Phil. (zonal value
750,000) 500,000
Franchise in USA 100,000
Receivable from debtor in Phil. 50,000
Receivable from debtor in USA 100,000
Bank deposit in Phil. 20,000
Bank deposit in USA 80,000
Shares of stocks of PLDT, Phil. 75,000
Shares of stock of ABC, foreign corporation 125,000
75% of the business in the Phil.
Other personal properties 300,000

28. If the decedent is a non-resident citizen his gross estate is:

a. P3,650,00 c. P2,500,000
b. P3,600,000 d. P2,650,000

29. If the decedent is non-resident alien his gross estate is:

a. P1,195,000 c. P1,250,000
b. P945,000 d. P1,070,000

30. If in the preceding number, reciprocity law can be applied the gross estate is:
TAXATION | ESTATE TAX

a. P1,050,000 c. P1,250,000
b. P945,000 d. P1,070,000

31. Based on the original problem but assuming the PLDT shares of stocks (PLDT) are not listed in the
Local Stock Exchange,& there are 1,000 shares at the time of death, the company’s outstanding
shares were 10,000 shares. Its retained earnings was P2,000,000, par value per share was
P50/share.The gross estate should show the said shares at:
a. Still at P75,000 c. P200,000
b. P250,000 d. P0

Questions 32 & 33 are based in the following information:

Building, USA P5,000,000
House & lot in Bulacan (500 sq. meters)
zonal value is P10,000 per square meter
4,500,000
Life insurance proceeds, beneficiary is the
wife, the administratix, irrevocable 500,000
Life insurance proceeds with another
company beneficiary, his nephew, 200,000
irrevocable
Claims against a debtor who died a year
ago (50% collectible) 50,000
Death benefits from US Veteran
Administration 100,000
Death benefits from SSS 40,000
Paraphernal property of his surviving wife 2,000,000

He also transferred mortis causa the following:

FMW- FMV - Death
S Price Transfer
Car, Mla. P 500,000 P1,000,000 P 800,000
Land, Mla. 1,500,000 2,000,000 1,000.000
Land, USA 2,000,000 1,800,000 3,000,000

32. If the decedent is a Filipino citizen, his gross estate is:

a. P10,850,000 c. P10,950,000
b. P12,900,000 d. P11,050,000

33. If the decedent is a non-resident alien and his country does not impose transfer tax on any intangible
properties left by a Filipino decedent, his gross estate is:
a. P5,350,000 c. P6,500,000
b. P5,300,000 d.P6,000,000

34. The gross estate of a non-resident alien is P2,000,000, 75% of which is from abroad. The actual
funeral expenses totaled to P80,000, ¼ of which was paid by his employer. The deductible funeral
expense is:
a. P25,000 c. P6,250
b. P20,000 d.P80,000

35. Based on the preceding number (the same world G.E.) but the decedent is a non-resident citizen,
the deductible funeral expense is:
a. P25,000 c. P5,000
b. P60,000 d.P80,000

36. 1st statement: A note payable contracted 11 yrs. ago is a deduction from the gross estate if
notarized.
2nd Statement: To be deductible, medical expenses must be paid within one year period before
death.
a. True, True c. True, False
b. False, False d. False, True
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37. 1st Statement: Adecedent OFW cannot claim Family Home deduction.
2nd Statement: The liability of the heirs for estate tax is solidary.
a. True, True c. True, False
b. False, False d. False, True

38. Purobuto, non-resident Japanese, died leaving the following:

Exclusive properties, Philippines P 560,000
Conjugal properties, Philippines 420,000
Conjugal properties, Abroad 1,820,000
Deductions claimed:
Funeral expenses 100,000
Judicial expenses 100,500
Unpaid expenses 150,500
Losses: occurring 3 mos. After death
due to fire 120,000
Donation mortis causa to MakatiCity
Hall 180,000
Family Home (inc. above), located
abroad 1,000,000
Standard deduction 1,000,000

The taxable net estate is:

a. P210,000 c. P1,900,000
b. P516,500 d. P2,100,000

38-a. If decedent is a Filipino citizen, TNE is __________

39. JR, administrator claims the following funeral expenses for a decedent:
Expenses of interment (paid by friend) P 60,000
Cost of burial & tombstone (1/2 paid by 42,000
relatives)
Other funeral parlor expenses 36,000
Expenses during the wake
Before burial 13,000
Obituary notice 7,500
Card of thanks 3,500
Mourning clothing of friends 15,000
Mourning clothing of immediate family 5,000
members

If the gross estate is P1,000,000 the allowable funeral expense is:

a. P75,000 c. P174,500
b. P82,500 d.P 50,000

40. Based on Number 39 but the gross estate is P2,500,000 the allowable funeral expenses is:
a. P75,000 c. P125,000
b. P82,500 d.P93.500

41. Mr. Nabigla died on March 20, 2011 leaving a gross estate of P7,800,000 including a land inherited
from his uncle on October 15, 2007 and a car donated to him on April 20, 2005. The following data
pertain to the two properties:
Unpaid FMV upon FMV upon
Mortgage receipt death
Land P100,000 P1,800,000 P1,250,000
Car 50,000 300,000 400,000

The decedent was able to pay ½ of the unpaid mortgage on the land before his death. The deductions
are:
TAXATION | ESTATE TAX

Expenses, losses, indebtedness, taxes P1,200,000

(excluding the unpaid mortgages
above but including actual funeral
expenses of P300,000 and medical
expenses of P600,000)
Standard Deductions 1,500,000
Transfer to the Govt, included above 300,000
Death Benefits from Employer 200,000
Family home (included above) 2,000,000
The allowable vanishing deduction is:
a. P213,000 c. P426,000
b. P626,000 d.P440,625

42. The taxable net estate based on the preceding number is:
a. P4,056,250 c. P3,974,000
b. P5,555,300 d.P4,175,000

43. Mr. Dinakahinga, head of family died on January 15, 2010, leaving the following properties and
obligations:
Cash in bank, 50%, donated mortis causa
to Natl Govt;50-% to Q.C. gov’t P 300,000
House and lot in Makati, F. Home 1,500,000
Personal properties 1,500,000
Farm lot 825,000
Claim against an insolvent debtor 225,000
Transfer in contemplation of death
(gratuitous) 1,500,000
Transfer passing special power of
appointment 75,000
Deduction claimed:
Funeral expenses 575,000
Judicial expenses 67,500
Donation mortis causa to Quezon City
government 150,000
Unpaid mortgage on the farm lot 75,000
Medical expenses (included in the funeral
expense incurred within the 1 year
period with receipts) 225,000

The farm lot was inherited 5 ½ years by the decedent before his death with a value then of P575,000
and a mortgage indebtedness of P150,000.
The total deduction from the gross estate is:
a. P1,867,500 c.P2,092,500
b. P867,500 d.P3,092,500

44. Based on the preceding number, the taxable net estate assuming the farm was inherited 5 yrs ago:
a. P3,982,500 c. P2,757,500
b. P4,982,500 d.P2,672,329

45. MrKiliti, Filipino, married died leaving the following estate:

Car acquired before marriage by Mr. Kiliti
P 300,000
Car acquired before marriage by Mrs.
Kiliti 450,000
House and lot acquired during marriage 1,500,000
Jewelries of Mrs. kiliti 100,000
Personal properties inherited by:
Mr. Kiliti during marriage 250,000
Benefits from SSS 50,000
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Retirement benefits from a private firm 150,000

Proceeds of group insurance taken by his
employer 75,000
Land inherited by the wife during
marriage 1,000,000
Income earned from the land inherited by
wife(25% of which was earned after
death) 200,000
The gross estate under conjugal partnership of gain is:
a. P2,600,000 c. P1,950,000
b. P3,600,000 d.P2,200,000

46. Under the same problem, the gross estate under absolute community of property is:
a. P2,600,000 c. P1,950,000
b. P3,600,000 d.P2,500,000
47. Mr. Malungkot died intestate on September 30, 2014. He is survived by his wife. An inventory of
the estate showed the following:
FMV tax
declaration Zonal Value
Exclusive estate of Mr. M
Commercial land 700 sq. m. P 850,000 P 900/sq. m.
Residential land 900 sq. m. 580,000 1,000/sq. m.
Conjugal estate:
Farm land, 800, sq. m. 1,300,000 700/sq. m.
Residential house 750,000
Car, Toyota 200,000
Other property 280,000
Death benefits (RA 4917) 200,000

On January 1, 2014, the commercial land was mortgaged at the Phil. National Bank for P200,000 at
24% per annum. The residential house (certified family home is mortgaged with unpaid balance of
P180,000 as of the date of death). The 900 sq. m. residential land is the family home’s lot. Actual funeral
expenses amounted to P250,000 but ½ of which is non-deductible. Medical expenses reached P600,000
but ¼ only was incurred with in 1 yr before death. Judicial expenses reached P150,000.
The gross estate is:
a. P4,280,000 c. P2,730,000
b. P4,480,000 d. P4,160,000

48. The total deductions excluding share of surviving spouse and special deduction is:

a. P655,000 c. P855,000
b. P891,000 d. P1,016,000

49. The deduction for family home is:

a. P1,000,000 c. P900,000
b. 950,000 d. P750,000

50. The taxable net estate is:

a. P401,500 c. P201,500
b. P326,500 d. P101,500

52. Mr. Bombo, Filipino died on April 10, 2015 with the following data:
Estate tax
Gross Estate Deduction paid
Philippines P 1,375,000 P 75,000 P -
Foreign country A 300,000 150,000 3,7500
Foreign country B 450,000 525,000 -
Foreign country C 600,000 225,000 18,0000

The estate tax due still due is:

TAXATION | ESTATE TAX

a. P13,500 c.P14,000
b. P9,000 d.P13,250

Mr. Agawbuhay married under the regime of absolute community of property. Survived by his wife, left
behind the following properties and charges upon his estate:

Real property acquired during the marriage P 3,000,000

Family Home, built using community fund 1,000,000
Real property received as a gift during the
Marriage 2,000,000
Lot where family home was built, inherited
During the marriage 400,000
Funeral expenses 300,000
Taxes and Losses 1,300,000
Medical Expenses, with receipt, incurred
within 1 year period 1,000,000
Unpaid mortgage, exclusive property 250,000

53. The allowed family home deduction is:

a. P1,000,000 c. P900,000
b. P1,400,000 d. P700,000

54. The deduction for share of the surviving spouse is:

a. P 2,500,000 c. P 4,000,000
b. P 1,250,000 d. P 1,500,000

55. The net taxable estate is:

a. P 1,250,000 c. P 1,500,000
b. P 2,500,000 d. P 1,000,000

Juan Namaalam, Filipino, married, died on January 15, 2011. Assets declared and deductions claimed
by the estate are as follows:

Conjugal Assets:
Family Home (house) , Manila P800,000
Fishpond, Bulacan 1,000,000
Apartment, Makati 1,600,000
Shares of stock, Happy Co., domestic 600,000
Shares of stock, ABC, Inc., a foreign corporation60% of the
business is in the Phil. 400,000
Cash in Bank 100,000
Exclusive of Decedent:
Family Home (lot), Manila P500,000
(Received as donation to him by a relative, 3 years ago with
a value then of P 300,000)
Deductions claimed:
Funeral expenses P300,000
Family home deduction 1,300,000
Loss (Decedent has a receivable from Mr. KHO, a solvent debtor
who absconded) 500,000
Liability (This represents unpaid subscription shares of Kulapu Co. 200,000
acquired on February 10,2009)
Standard deduction (Unitemized and undocumented) 1,000,000
Death benefits under RA 4917 300,000
Accounts payable 200,000
TAXATION | ESTATE TAX

Judicial expense 100,000

56. The gross estate of Juan Namaalam is:

a. P5,000,000 c. P6,000,000
b. P4,600,000 d. P5,500,000

57. The total allowable deductions from the gross estate excluding share of surviving spouse
a. P1,165,000 c. P2,965,000
b. P2,465,000 d. P2,865,000