July 13, 1999

BIR RULING NO. 105-99

90 (A); 97-105-99

Mr. Armando S. Rosil

No. 59 Countryside Subdivision

Barangka Ibaba

Mandaluyong City

Sir:

This refers to your letter dated July 2, 1999 requesting on behalf of the heirs of the late Antigono A. Rosil
for a ruling as to whether or not the said estate which consists merely of bank accounts in the total
amount of P153,478.01 is exempt from the payment of estate tax. cdrep

It appeals that Antigono A. Rosil died without a will on April 16, 1999 in Mandaluyong City; that he was
survived by his wife, Antonina S. Rosil and three (3) legitimate children namely, Nomerito, Alfredo and
Armando; that his estate consists mainly of bank accounts with Land Bank of the Philippines as certified
to on July 1, 1999 by Ms. Violeta C. Constantino, Acting Head, LBP-Mandaluyong City, more particularly
described as follows:

Account Number Account Name Amount

SA#2311-0272-31 Antigono A. Rosil P50,783.56

PSP#2311-0298-89 Antigono A. Rosil and/or 102,339.10

Armando Rosil

PSP#2311-0286-70 Antigono A. Rosil and/or Alfredo 103,049.81

S. Rosil

that on May 27, 1999, an Extra-Judicial Settlement of Estate of the Deceased Antigono A. Rosil with
Waiver of Rights was executed by the above-mentioned heirs; and that the parties herein agreed that
the three (3) legitimate children will waive their respective right to the aforesaid accounts in accordance
with the rule on Intestate Succession in favor of their mother, Antonina S. Rosil.

In reply, please be informed that Section 90(A) of the Tax Code of 1997 provides —

"SEC. 90. Estate Tax Returns. —

"(A) Requirements. — In all cases of transfers subject to the tax imposed herein, or where, though
exempt from tax, the gross value of the estate exceeds Two hundred thousand pesos (P200,000.00), or
regardless of the gross value of the estate, where the said estate consists of registered or registrable
property such as real property, motor vehicle, shares of stock or other similar property for which a
clearance from the Bureau of Internal Revenue is required as a condition precedent for the transfer of
ownership thereof in the name of the transferee, the executor, or the administrator, or any of the legal
heirs, as the case may be, shall file a return under oath in duplicate, setting forth:

"(1) The value of the gross estate of the decedent at the time of his death, . . .

"(2) The deductions allowed from gross estate in determining the estate as defined in Section 86;
and

"(3) Such part of such information as may at the time be ascertainable and such supplemental data
as may be necessary to establish the correct taxes.

Considering that the gross estate of the late Antigono A. Rosil consists merely of bank accounts in the
total amount of P153,478.01 which is even lower than the P200,000.00 tax exempt portion of the net
estate bracket as imposed under Section 84 of the same Code, the estate of the late Antigono A. Rosil is
indeed exempt from estate tax. However, the executor, administrator or any of the legal heirs of the
late Antigono A. Rosil shall be required to file the corresponding estate tax return within six (6) months
from the decedent's death with the Revenue District Officer (RDO) of the revenue district where the
decedent was previously registered.

Corollarily, Section 97 of the Tax Code of 1997 pertinent portion of which provides —

"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.

It is clear from the above-cited Section that unless a certification has been issued by the Commissioner
that the estate tax has been paid or the estate of the late Antigono A. Rosil is indeed exempt from the
payment thereof, only the amount of P20,000.00 may be authorized by the Commissioner to be
withdrawn from the bank account of the deceased.

On the other hand, the waiver by the three (3) legitimate children namely, Nomerito, Alfredo and
Armando of their respective share in the above-mentioned estate in favor of their mother, Antonina S.
Rosil is not subject to donor's tax as prescribed under Section 98 of the Tax Code of 1997, this is so
because in legal succession, accretion takes place in case of repudiation among heirs of the same
degree. In other words, when the three (3) legitimate children renounced their share in the inheritance,
they did not donate the property/share to their mother, since the said property/share has never
become their own. (BIR Ruling No. DA251-99 dated April 23, 1999)

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.) BEETHOVEN L. RUALO

Commissioner

Bureau of Internal Revenue