Inheritance Tax in Philippines!

[Tish]

Has anyone ever encountered having to pay inheritance tax on land purchased?

I never heard of anything like it before, even when I bought my first lot in Philippines.

After what I called being 'conned' into paying for the right of way last year, I now been asked that I still needed to pay an inheritance tax!

I was never aware of this matter. As far as I was concerned, I paid all duties needed for land transaction!

Now I feel like they trying to make more money out of me

Well I hope I'm mistaken, otherwise I will be really pi**ed off

Hope anyone can shed light into this matter for me.

Yours truly,
Pi**ed Tish

[PeterB]

Yes, if the land came froom the estate of a deceased person, and the inheritance tax has not been paid, you will not be able to register the title.

When purchasing land, in particular, you need to beware ... 'capital gains' tax and inheritance tax are often left to the purchaser to pay. Capital gains tax is not like CGT in the UK ... it is due on the total price, not just the difference between purchase and sale price.

[Tish]

Thanks for clearing this matter up for me PeterB, much appreciated.

I just hope, it's not going to cost a bomb, as exchange rate not so good lately

Tish

[PeterB]

Well, assuming that the death occurred after January 1, 1998. the rate of Inheritance tax varies between 5% and 20% - depending on the total value of the estate of the deceased person.

The real problem occurs if none of the IHT has been paid ... I suspect that you could end up having to ensure that the tax is paid on the full estate before you can register your title. Also, if it is more than six months since the death, there will almost certainly be a penalty to pay as well.

Who was your attorney? They should have checked all these details before the deal was done. I think I recall postings about the right of way to access to your land - which is given by law in any land purchase, so I suspect that the legal advice you received was not good.

[LEAHnew]

Hi ate Tish sorry to hear about it

Is this referring to Estate tax? from Phil.Gov. BIR (Bureau of Internal Revenue) means Estate Tax is a tax on the right of the deceased person to transmit his/her estate to his/her lawful heirs and beneficiaries at the time of death and on certain transfers which are made by law as equivalent to testamentary disposition.

And this is the link of Estate Tax law

http://www.bir.gov.ph/taxcode/1889.htm
I hope you will sort it out soon

Wow Sir PeterB very well said, impress me alot for Phil Taxation

[vbkelly]

yeah i paid inheritance tax when i bought the lands 3years ago and im the buyer of the lands but i did paid the gain tax

[Tish]

Well, assuming that the death occurred after January 1, 1998. the rate of Inheritance tax varies between 5% and 20% - depending on the total value of the estate of the deceased person.

The real problem occurs if none of the IHT has been paid ... I suspect that you could end up having to ensure that the tax is paid on the full estate before you can register your title. Also, if it is more than six months since the death, there will almost certainly be a penalty to pay as well.

Who was your attorney? They should have checked all these details before the deal was done. I think I recall postings about the right of way to access to your land - which is given by law in any land purchase, so I suspect that the legal advice you received was not good.

The death was after Jan. 1,1998, so I'm now dreading the amount I have to pay using the highest percentage.

Also, I've got a feeling that none of the IHT has been paid since the death and that is more than a year now

I don't think the attorney who was handing this matter for me have done their job properly, and consequently, it looks like I will now have to pay for his inadequacies

[Tish]

[QUOTE=kukurokuk;85617]Hi ate Tish sorry to hear about it

Hi Kukurokuk, thanks for sympathizing with me and also for the link.

The whole situation regarding the purchase of this land for me is a nightmare

I just have to thinks that there's always light at the end of the tunnel.

Tish

[Tish]

yeah i paid inheritance tax when i bought the lands 3years ago and im the buyer of the lands but i did paid the gain tax

Hi Vbkelly,

Do you happen to recall the percentage of inheritance tax you paid 3 years ago?

Tish

[keithAngel]

I don't think the attorney who was handing this matter for me have done their job properly, and consequently, it looks like I will now have to pay for his inadequacies

Lawyers here have a quaint professional indemnity insurance which pays up when they make a mistake otherwise they would be personally liable and another lawyer would sue them

[andypaul]

Lawyers here have a quaint professional indemnity insurance which pays up when they make a mistake otherwise they would be personally liable and another lawyer would sue them

Mr Keith knows the details, but I was thinking the same.

If a lawyer did not discover something as important as this i think i would have him or her paying for it if at all possible.

I think there is a phill lawyer who posts on here maybe they can advise. if not i can ask in the Wifes half of the family as there are a few lawyers but more on the commercial side so maybe different rulings etc.

[Tish]

Mr Keith knows the details, but I was thinking the same.

If a lawyer did not discover something as important as this i think i would have him or her paying for it if at all possible.

I think there is a phill lawyer who posts on here maybe they can advise. if not i can ask in the Wifes half of the family as there are a few lawyers but more on the commercial side so maybe different rulings etc.

I could start litigation process for the useless solicitor, but in reality, all it do is create more hassle and anger on my part plus wasting my time and money I've no trust left in me with any solicitors out there in Philippines.

All can do now is wait furiously for the total amount of inheritance tax to be paid for by me

Life is so cruel indeed , and the only thing that keeps me sane is to concentrate of life here in the UK, at least I've no problem here.

Tish

[LEAHnew]

[QUOTE=Tish;85682]

Hi ate Tish sorry to hear about it

Hi Kukurokuk, thanks for sympathizing with me and also for the link.

The whole situation regarding the purchase of this land for me is a nightmare

I just have to thinks that there's always light at the end of the tunnel.

Tish

I sympathesize you coz I can relate a bit oh but not exactly me, my dad
I know how's the feeling of it My Dad never realise that the tax
he paid was nearly the cost of the land he purchased

from this chart http://www.bir.gov.ph/taxinfo/tax_estate.htm#20138
Just to give u brief idea of computation for example:
Let say After July 28, 1992 up to December 31, 1997
net estate= 700,000
500,000 = 15,000
200,000= 16,000 (8% of excess over)
Total = 31,000

I am not good in Taxation been aware just for my Dad concern, i think i might help him to undergo proper procedure and need good CONNECTION to the local government

Goodluck ate Tish, it will be alright and in brightside it's good investment

[vbkelly]

[QUOTE=kukurokuk;85738]

I sympathesize you coz I can relate a bit oh but not exactly me, my dad
I know how's the feeling of it My Dad never realise that the tax
he paid was nearly the cost of the land he purchased

from this chart http://www.bir.gov.ph/taxinfo/tax_estate.htm#20138
Just to give u brief idea of computation for example:
Let say After July 28, 1992 up to December 31, 1997
net estate= 700,000
500,000 = 15,000
200,000= 16,000 (8% of excess over)
Total = 31,000

I am not good in Taxation been aware just for my Dad concern, i think i might help him to undergo proper procedure and need good CONNECTION to the local government

Goodluck ate Tish, it will be alright and in brightside it's good investment

yeah sis leah you right i paid the tax nearly high as the lands i bought and last april i paid £400 for penalty for 3years...

[LEAHnew]

[QUOTE=vbkelly;85742]

yeah sis leah you right i paid the tax nearly high as the lands i bought and last april i paid £400 for penalty for 3years...