BIR Ruling [DA-248-05]

June 8, 2005 BIR RULING [DA-248-05] Sections 90 (B) & 90 (C) Atty. Harriet O. Demetriou 19 Road 13, Pagasa Quezon City M a d a m : This refers to your letter dated May 26, 2005 requesting on behalf of your client, Jesusa Sonora-Poe (aka Susan Roces) for an extension of one (1) year from June 13, 2005 within which to file the estate tax return and pay the estate tax due on the estate of the late Ronald Allan Poe (aka Fernando Poe, Jr.). It is represented that the late Ronald Allan Poe died intestate on December 14, 2004; that as of date, there has been no settlement yet of Ronald Allan Poe's estate whether judicial or extrajudicial; and that the payment of the estate tax which is due on June 13, 2005 will impose undue hardship upon the decedent's estate and on his heirs by reason of the substantial tax to be paid thereon which will at least amount to several millions of pesos, hence, your client is constrained to seek for an extension within which to file the required estate tax return and pay the estate tax due thereon. In reply thereto, 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 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 pursuant to Section 91(B) of the Tax Code of 1997. Based on the foregoing, your request for an extension of time within which to pay the estate tax is hereby granted up to the maximum period of five (5) years in case the estate is settled through the courts, or two (2) years in case the estate is settled extrajudicially reckoned from December 14, 2004 pursuant to Section 91(B) of the Tax Code of 1997. On the other hand, under Section 90(C) of the Tax Code, only thirty (30) days is granted as an extension of the period within which to file the estate tax return reckoned from the lapse of the six-month period within which the said return is required to be filed. Based on the aforestated justifiable reason, your request for an extension to file the estate tax is hereby granted for a period of thirty (30) days counted from June 13, 2005, which is the last day for filing of the estate tax return of the late Ronald Allan Poe. Accordingly, the filing of the said estate tax return of the decedent is hereby extended up to July 13, 2005 pursuant to Section 90(C) of the Tax Code of 1997. ScEaAD In view of the favorable action upon your request for extension of time, this Office has decided to forego within the 30-day period for filing the estate tax return and within the 5-year or 2-year period, as the case may be, for paying the estate tax due thereon, the imposition of the surcharge and penalties on the estate tax due on the transmission of the estate of the late Ronald Allan Poe to his heirs. However, it shall be understood that the estate shall be liable for the corresponding interest that have accrued thereon up to the time of payment of the estate tax pursuant to Section 249 of the Tax Code of 1997 (BIR Ruling No. DA 260-2000 dated June 9, 2000). Further, the special administrator of the estate of the late Ronald Allan Poe is hereby required to furnish a bond in such amount not exceeding double the amount of the tax and/or a surety conditioned upon the payment of the estate tax in accordance with the terms of this extension. Very truly yours, (SGD.) JOSE MARIO C. BUAG Deputy Commissioner Legal and Inspection Group