BIR Ruling [DA-069-03]

March 10, 2003 BIR RULING [DA-069-03] Mr. Perfecto E. Mirador, Jr. Estate Administrator 51 Sanso Street Corinthian Gardens Quezon City S i r : This refers to your letter dated December 5, 2000 requesting on behalf of the heirs of the late Antonio Mercado for an extension of time within which to pay the corresponding estate tax due on the transmission of the estate of the late Antonio Mercado pursuant to Section 9(B) of the Tax Code of 1997. It is represented that the late Antonio Mercado died on July 26, 2000; that at the time of his death, he has left several real properties located in different provinces; that the extent and value of the estate cannot yet be ascertained; that the heirs are still in the process of collating all the documents relating to the aforesaid properties which will form part of the said estate; that the filing of the estate tax return and payment of the tax would impose undue hardship upon the estate; and that the same would be difficult for the heirs to pay the estate tax considering their present financial status to pay the aforesaid tax. In reply, please be informed that pursuant to Section 91(B) of the Tax Code of 1997 which provides, viz. : "(B) Extension of Time. When the Commissioner finds that the payment on the due date of the estate tax or 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. Accordingly, in view of the aforestated justifiable reasons, your request on behalf of the heirs of Antonio Mercado, for an extension of time within which to pay the estate tax due on the transmission of the estate of the late Antonio Mercado is hereby granted. ADHaTC It shall be understood, however, that the estate shall be liable for the corresponding interest that shall have accrued thereon up to the time of payment of the estate tax due on the transmission of the said estate to the heirs pursuant to Section 249 of the Tax Code of 1997. ( BIR Ruling No. DA-285-98 dated June 29, 1998 ) Very truly yours, (SGD.) MILAGROS V. REGALADO Assistant Commissioner Legal Service