BIR Ruling [DA-180-06]

March 27, 2006 BIR RULING [DA-180-06] 90 (C) & 91 (B); DA-298-2004 dtd June 1, 2004 Gloria S. Cheng #3 Santiago St., San Francisco Del Monte, Quezon City M a d a m : This refers to your letter dated March 21, 2006 requesting on behalf of the heirs of JOSE P. DELA CRUZ an extension of thirty (30) days from March 24, 2006 or until April 23, 2006 to file the Estate Tax Return of the decedent, and an extension of two (2) years from March 24, 2006 or until March 24, 2008 to pay the full amount of the tax due on the transmission of the estate of the decedent to the heirs. It could be ascertained from the records that Jose P. Dela Cruz died intestate on September 24, 2005 at Ugong, Valenzuela City; that the request for extension of time to file the estate tax return and pay the tax due within two (2) years is due to the fact that you are in the process of collating the documents for the preparation of the return, and you are still raising funds necessary for the payment of taxes due thereon. In reply, please be informed that under Section 90(B) and (C) of the Tax Code of 1997, estate tax return is required to be filed within six (6) months from the decedent's death, and in meritorious cases, a reasonable extension not exceeding thirty (30) days for filing the return may be granted by the Commissioner of Internal Revenue. The payment of the estate tax or any part thereof shall be made upon the filing of the return or on such date as fixed if an extension is granted by the Commissioner, but in no case shall it exceed five (5) years if the estate is settled through the courts, or two (2) years in case the estate is settled extra judicially pursuant to Section 91(B) of the Tax Code of 1997. HIAESC Based on the aforestated justifiable reasons, your request for an extension of time within which to pay the estate tax is hereby granted pursuant to Section 91 (B) of the Tax Code of 1997. Accordingly, the estate tax due on the Estate of JOSE P. DELA CRUZ may be paid up to two (2) years counted from March 24, 2006 or until March 24, 2008. On the other hand, under Section 90 (C) of the Tax Code, a thirty-day extension is granted within which to file the estate tax return. Thus, considering that the last day for filing the estate tax return on the estate of JOSE P. DELA CRUZ is on March 24, 2006, the period within which to file the same is hereby extended up to April 23, 2006. Moreover, in view of the above favorable action on your request for an extension of two (2) years within which to pay the estate tax, this Office has decided to forego the imposition of the surcharge and penalties on the estate tax due on the transmission of the Estate of JOSE P. DELA CRUZ. However, it shall be understood that the estate shall be liable for the corresponding interest that has accrued thereon up to the time of payment of the aforesaid estate tax pursuant to Section 249 of the Tax Code of 1997. Very truly yours, (SGD.) JAMES H. ROLDAN Assistant Commissioner Legal Service