BIR Ruling No. 423-13

November 14, 2013 BIR RULING NO. 423-13 Sections 4 and 97 of the Tax Code of 1997, as amended Rogelio T. Karagdag, Jr. 1240 Apacible Street Paso, Manila Gentlemen : This refers to your letter dated August 30, 2013 requesting in behalf of your clients, the Heirs of Francisco Casal, for an authority to withdraw the decedent's deposits with Bank of Philippine Islands (BPI) in order to pay the amount of P2,602,883.93 constituting the estate tax due on his estate. It is represented that the estate tax return for the estate of Francisco Casal has been computed and finalized by Revenue District Office (RDO) 39 at P2,602,883.93 as of August 27, 2013; that RDO 39 had granted your request to withdraw the amount to settle the estate tax of the deceased but BPI refused to honor its letter on the ground that it was not signed by the Commissioner of Internal Revenue. In view of the foregoing, you are requesting for permission and assistance to enable the heirs to withdraw the deposit in BPI with the condition that the amount of P2,602,883.93 constituting the estate tax due on the estate of Francisco Casal shall immediately be paid to the BIR. In reply, please be informed that your above request is hereby partially granted. Section 97 of the Tax Code of 1997, as amended, allows only the withdrawal in the maximum amount of P20,000.00 upon authorization of the Commissioner, to wit: "SEC. 97. Payment of Tax Antecedent to the Transfer of Shares, Bonds or rights. IHaCDE xxx xxx xxx If a bank has knowledge of the death of a person, who maintained a bank deposit account alone, or jointly with another, it shall not allow any withdrawal from the said deposit account, unless the Commissioner has certified that the taxes imposed thereon by this Title have been paid: Provided, however, that the administrator of the estate or any one (1) of the heirs of the decedent may, upon authorization by the Commissioner, withdraw an amount not exceeding twenty thousand pesos (P20,000.00) without the said certification . For this purpose, all withdrawal slips shall contain a statement to the effect that all of the joint depositors are still living at the time of withdrawal by any one of the joint depositors and such statement shall be under oath by the said depositors." (emphasis supplied) However, in recognition of your predicament and with the end of settling the estate tax liability of herein decedent, this Office, in consonance with the power granted to the Commissioner under Section 4 of the Tax Code, as amended, allows the heirs of Francisco Casal to withdraw from his bank account the amount of P2,602,883.93 only, constituting the estate tax due, and not the entire amount deposited therein. In view thereof, BPI is hereby given the authority to debit from the decedent's account the amount of P2,602,883.93 and to immediately credit the same to the account of the BIR. Moreover, this Ruling shall not preclude the Bureau of Internal Revenue from conducting further investigation to determine the appropriate estate tax liability of the estate concerned. This ruling is being issued on the basis of the foregoing facts as represented. However, if upon investigation, it will be disclosed that the facts are different, then this ruling shall be considered null and void. Very truly yours, (SGD.) KIM S. JACINTO-HENARES Commissioner of Internal Revenue