BIR Ruling No. 110-82

April 6, 1982 BIR RULING NO. 110-82 107-c 000-00 110-82 Atty. Rosendo N. Feleo Rm. 408 Laperal Building 865 Rizal Avenue, Manila S i r : This refers to your letter dated November 20, 1981 in behalf of your client, Miss Teresita F. Cruz of Marulas, Valenzuela, Metro Manila requesting that she be allowed to file the estate and capital gains tax returns and to pay the corresponding taxes due on the property she purchased from a certain Mrs. Virginia Cruz. It is represented that on May 16, 1980, Mrs. Virginia Cruz, the alleged sole heir of her deceased son, Wilfredo F. Cruz, extrajudicially adjudicated unto herself a parcel of land with an area of 246 square meters and covered by Transfer Certificate of Title No. 193906; that after the said extra-judicial adjudication, Mrs. Virginia Cruz executed a deed of sale of the said parcel of land in favor of Miss Teresita F. Cruz; that the vendor did not file the corresponding estate tax return and the capital gains tax return; that Miss Teresita F. Cruz had offered to pay the taxes on the property so that a tax clearance may be issued in her favor for the registration of the aforesaid deed; and that our Regional Office in Valenzuela, Metro Manila refused to accept the payments unless the returns are signed by the vendor which could not be done as alleged by you since her present whereabouts is not known. In reply thereto, I have the honor to inform you that pursuant to Section 107(c) of the Tax Code, the estate tax shall be paid by the executor or administrator before delivery to any beneficiary of his distributive share of the estate. Such beneficiary shall to the extent of his distributive share of the estate be subsidiarily liable for the payment of such portion of the estate tax as his distributive share bears to the value of the total net estate or if there is no executor or administrator appointed, qualified, and acting within the Philippines, then any person in actual or constructive possession of any property of the decedent. Such being the case, and since as represented, the whereabouts of Mrs. Virginia Cruz, the beneficiary vendor in this case is unknown, and Miss Teresita F. Cruz is in actual possession of the property of the decedent as a result of the sale in her favor by the vendor, she is therefore liable for the payment of the estate tax. Likewise, the vendee can file the return and pay the capital gains tax due thereon in order to effect the transfer of the title to the property in her name. cd Very truly yours, RUBEN B. ANCHETA Acting Commissioner