Consequences of Failure to File and Pay the Estate Tax

Most of the time, people are not motivated to do something if they are not aware of the consequences of their action. The main objective of this article is to inform every Filipino about the policies of failure to process the estate tax of the deceased person.

You may not completely be aware of the concept of the estate tax in the Philippines, but that doesn’t mean that you can just ignore or take it for granted.

Those who fail to adhere or comply with this will not be tolerated by the law. Therefore, we really have no choice but to file and pay for it if we want to take over the properties of our deceased relative.

What to do?

The heirs of the deceased are required to file the estate tax within six (6) months beginning from the death of the decedent. An extension of not exceeding to thirty (30) days may be granted with a valid reason.

However, if the request for extension is due to negligence on the side of the taxpayer, the commissioner won’t grant the extension.

If the commissioner finds out along the process that the estate tax result to the burden on the side of the heirs.

  • A not exceeding to (five) 5 years extension is granted if the estate tax is settled through the courts.
  • A not exceeding to two (2) years extension is also granted if the estate tax will be settled under extrajudicially.

The estate should be filed together with the corresponding documents listed on the website of the BIR. Heirs or authorized representatives use the BIR Form 1801 and pay the estate tax to Authorized Agent Bank (AAB), Revenue Collection Office (RCO) or to the Authorized Municipal or City Treasurer in the Revenue District Office where the decedent registered his Tax Identification Number (TIN).

If the decedent is a non-resident and doesn’t have a TIN, the heirs or authorized representative should file the estate tax with AAB of the RDO where they are domiciled.

In the situation where the decedent is a nonresident with no heirs or authorized representative in the Philippines. The estate tax must be filled with the AAB under the jurisdiction of the RDO No.39 South Quezon City.



Failure to adhere the aforementioned may result in the following penalties:

  1. Surcharge

If you are not able to file the estate tax on the allowable time or you are not able to pay it before the said due to date. There will be an additional twenty five percent (25%) from the amount of the estate tax that should be paid.

If proven that fraud is involved, the surcharge will be fifty percent (50%) from the amount of the estate tax that should be paid.

  1. Interest

Failure to pay the full amount of the estate tax before the due date will result to an imposed of a minimum of twenty percent (20%) interest per annum from the unpaid amount until it’s fully paid.

  1. Compromise

If you fail to file your estate tax return in the allowable time and you fail to give the correct information, this may result to an imprisonment of not less than one (1) year but not more than ten (10) years.

Additionally, there is also a fine of not less than ten (10) thousand pesos. This punishment also includes failure to Pay Tax Withhold and Remit Tax and Refund Excess Taxes Withheld on Compensation.

These are just some of the consequences that you may be faced with if you fail to adhere your obligations as heirs.

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