15/11/2023
WHAT IS ESTATE TAX?
Don't get confused with ESTATE TAX vs. Real Estate Property Tax.
👉The estate tax is a tax on the privilege to transfer one’s estate at the time of death to his heirs. This succession may be either through a will or intestate succession.
Section. 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 rate of six percent (6%) based on the value of such net estate.
👉Real property tax (RPT) or commonly known as “amilyar” is a tax on the value of the real property a person owns. This is a form of ad valorem tax based on a fixed proportion of the property’s value.
A province or city, or municipality within the Metropolitan Area may levy an annual ad valorem tax on real property such as land, building, machinery, and other improvements not hereinafter specifically exempted. (Section 232, Local Government Code)
While the BIR administers estate tax, the local government units (LGUs) have the responsibility to administer RPT. These LGUs have some forms of administrative autonomy and flexibility in their local affairs.
