BIR Ruling [DA-483-98]

November 9, 1998 BIR RULING [DA-483-98] Mr. George P. Gil 20 Alta Vista Drive Quezon City S i r : This refers to your letters dated October 7, 1997 and November 11, 1997 requesting on behalf of the heirs of the late Roy F Gil for an extension of two (2) years within which to pay the estate tax due on the transmission of the said estate to the heirs pursuant to then Section 84(b) of the Tax Code, as amended [now Section 91(B) of the Tax Code of 1997]. It is represented that the late Roy F Gil died on April 7, 1997; that on November 5, 1997, you were given an extension of thirty (30) days within which to file the estate tax return; that on the said date, you filed the said return but failed to pay the tax due; that as administrator/executor of the said estate, you are constrained to make this request considering that the heirs cannot produce the amount of P316,967.11 as basic estate tax in a short period of time; that the estate has no sufficient liquid assets and it is highly improbable to sell any of the properties left by the decedent in a day or two; and that on November 11, 1997, you paid the amount of P316,967.11 as basic estate tax to the authorized agent bank bearing Official Receipt No. 491997. In reply, please be informed that Section 84(b) of the Tax Code, as amended [now Section 91 (B) of the Tax Code of 1997] reads : "(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 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 assessments provided in Section 203 of this Code shall be suspended for the period of any such extension. xxx xxx xxx" Accordingly, in view of the aforesaid justifiable reason, your request for an extension of two (2) years within which to pay the estate tax due thereon is hereby granted. Thus, you are given until November 6, 1999 to pay the estate tax due on the estate of the late Roy F. Gil. Such being the case and considering that the heirs of the late Roy F. Gil have paid the amount of P316,967.11 on November 11, 1997, this Office has decided to forego the penalties and surcharge imposed under Section 248(A)(1) of the Tax Code of 1997 but subject to the corresponding interest that have accrued thereon up to the time of payment of the estate tax. Very truly yours, (SGD.) BEETHOVEN L. RUALO Commissioner of Internal Revenue