The document summarizes key aspects of estate tax in the Philippines. It discusses that estate tax is imposed on the privilege of transmitting property at death based on the net estate. The gross estate includes all property owned by the decedent at death regardless of location. Allowable deductions include funeral expenses, debts, taxes, losses. The net estate is taxed at graduated rates with the first P200,000 exempt for residents and a proportionate amount for non-residents. Certain transfers like those in contemplation of death or with retained rights are included in the gross estate.
This syllabus outlines the course on Agency, Trust and Partnership Law. It will cover important provisions from the Civil Code on agency (Title X), partnerships (Title IX), and trusts (Title V). For agency, it will discuss the nature, parties, elements and characteristics of agency, kinds of agencies, formalities of agency, powers and duties of agents and principals, and termination of agencies. For trusts, it will introduce trusts under the New Civil Code, discuss the nature and kinds of trusts, and cover express trusts in more detail including their definition, nature, and essential characteristics.
Rule 78 LETTERS TESTAMENTARY AND OF ADMINISTRATION WHEN AND TO WHOM ISSUEDlspujurists
This document outlines the rules regarding who can administer an estate under Philippine law. It discusses the different types of authority that can be issued: letters testamentary to an executor named in a will; letters of administration to someone administering an intestate estate; and letters of administration with a will annexed if the executor is incompetent. It details who is competent to serve as an executor or administrator, such as a resident adult, and who is not, like a minor. It also addresses related issues like whether a married woman can serve, what happens if co-executors are disqualified, and the scope of an administrator's authority.
This document summarizes rules regarding special proceedings in the Philippines, specifically focusing on the settlement of estates of deceased persons. It provides details on:
1) Which courts have jurisdiction over probate proceedings based on the value of the estate. Regional trial courts have jurisdiction over most estates, while metropolitan and municipal trial courts handle smaller estates.
2) Venue requirements for probate, which is generally the province where the deceased resided. Extrajudicial settlement is allowed if heirs agree and certain conditions are met.
3) Probate court powers including ordering probate of wills, granting letters of administration, approving claims and debts, authorizing real estate transactions, and distributing estates.
The document then provides
1) Gloria B. Salvador sells to Rodolfo B. Balunso Jr. an 8,800 square meter parcel of land in Manapao, Minalabac, Camarines Sur for 350,000 Philippine pesos.
2) The land is described as Lot 3245-A with boundaries along other lots, and Gloria Salvador provides the title and guarantees there are no encumbrances.
3) The deed of sale is signed and acknowledged by both parties in the presence of witnesses and a notary public in July 2014.
The Supreme Court ruled on three issues in the case of Secretary Leila De Lima vs. Magtanggol B. Gatdula. First, it ruled that requiring an answer to an amparo petition is inappropriate, as the return serves as the responsive pleading. Second, it ruled that a return must be filed prior to a hearing to allow the issues to be joined properly. Third, it distinguished between the privilege of the writ of amparo and the actual writ order, finding that simply granting the privilege is insufficient and does not provide relief.
03 chapter 4 deductions from gross estate part 03Flab Villasencio
This document discusses various deductions that can be taken from a decedent's gross estate for estate tax purposes. It outlines ordinary deductions like expenses, losses, indebtedness, taxes, and transfers for public use. Special deductions are also discussed, including the amount received by heirs under RA 4917, the share of the surviving spouse, the family home, medical expenses, and the standard deduction. The document provides examples and explanations of how these deductions are calculated and allocated. Non-resident alien decedents have fewer allowable deductions, limited to estate liabilities in the Philippines and transfers for public use.
03 chapter 4 deductions from gross estate part 02Flab Villasencio
This document discusses various deductions that can be taken from a gross estate for tax purposes in the Philippines, including ordinary expenses, losses, indebtedness, taxes, transfers for public use, and amounts received by heirs. It provides details on vanishing deductions, which allow a deduction on property received within 5 years that was previously taxed. An example calculation is shown for a vanishing deduction involving property inherited by Gina Dan from her mother Pina Dan that increased in value over time.
This document discusses transfer taxes and estate taxes. It defines a transfer tax and differentiates between an estate tax and a donor's tax. It also covers the nature and concept of succession. Specifically, it defines succession as the transmission of a deceased person's property, rights and obligations to heirs through death. The document outlines the key elements of succession including the decedent, heir and estate. It also categorizes the different types of succession, heirs, and persons authorized to manage an estate.
This syllabus outlines the course on Agency, Trust and Partnership Law. It will cover important provisions from the Civil Code on agency (Title X), partnerships (Title IX), and trusts (Title V). For agency, it will discuss the nature, parties, elements and characteristics of agency, kinds of agencies, formalities of agency, powers and duties of agents and principals, and termination of agencies. For trusts, it will introduce trusts under the New Civil Code, discuss the nature and kinds of trusts, and cover express trusts in more detail including their definition, nature, and essential characteristics.
Rule 78 LETTERS TESTAMENTARY AND OF ADMINISTRATION WHEN AND TO WHOM ISSUEDlspujurists
This document outlines the rules regarding who can administer an estate under Philippine law. It discusses the different types of authority that can be issued: letters testamentary to an executor named in a will; letters of administration to someone administering an intestate estate; and letters of administration with a will annexed if the executor is incompetent. It details who is competent to serve as an executor or administrator, such as a resident adult, and who is not, like a minor. It also addresses related issues like whether a married woman can serve, what happens if co-executors are disqualified, and the scope of an administrator's authority.
This document summarizes rules regarding special proceedings in the Philippines, specifically focusing on the settlement of estates of deceased persons. It provides details on:
1) Which courts have jurisdiction over probate proceedings based on the value of the estate. Regional trial courts have jurisdiction over most estates, while metropolitan and municipal trial courts handle smaller estates.
2) Venue requirements for probate, which is generally the province where the deceased resided. Extrajudicial settlement is allowed if heirs agree and certain conditions are met.
3) Probate court powers including ordering probate of wills, granting letters of administration, approving claims and debts, authorizing real estate transactions, and distributing estates.
The document then provides
1) Gloria B. Salvador sells to Rodolfo B. Balunso Jr. an 8,800 square meter parcel of land in Manapao, Minalabac, Camarines Sur for 350,000 Philippine pesos.
2) The land is described as Lot 3245-A with boundaries along other lots, and Gloria Salvador provides the title and guarantees there are no encumbrances.
3) The deed of sale is signed and acknowledged by both parties in the presence of witnesses and a notary public in July 2014.
The Supreme Court ruled on three issues in the case of Secretary Leila De Lima vs. Magtanggol B. Gatdula. First, it ruled that requiring an answer to an amparo petition is inappropriate, as the return serves as the responsive pleading. Second, it ruled that a return must be filed prior to a hearing to allow the issues to be joined properly. Third, it distinguished between the privilege of the writ of amparo and the actual writ order, finding that simply granting the privilege is insufficient and does not provide relief.
03 chapter 4 deductions from gross estate part 03Flab Villasencio
This document discusses various deductions that can be taken from a decedent's gross estate for estate tax purposes. It outlines ordinary deductions like expenses, losses, indebtedness, taxes, and transfers for public use. Special deductions are also discussed, including the amount received by heirs under RA 4917, the share of the surviving spouse, the family home, medical expenses, and the standard deduction. The document provides examples and explanations of how these deductions are calculated and allocated. Non-resident alien decedents have fewer allowable deductions, limited to estate liabilities in the Philippines and transfers for public use.
03 chapter 4 deductions from gross estate part 02Flab Villasencio
This document discusses various deductions that can be taken from a gross estate for tax purposes in the Philippines, including ordinary expenses, losses, indebtedness, taxes, transfers for public use, and amounts received by heirs. It provides details on vanishing deductions, which allow a deduction on property received within 5 years that was previously taxed. An example calculation is shown for a vanishing deduction involving property inherited by Gina Dan from her mother Pina Dan that increased in value over time.
This document discusses transfer taxes and estate taxes. It defines a transfer tax and differentiates between an estate tax and a donor's tax. It also covers the nature and concept of succession. Specifically, it defines succession as the transmission of a deceased person's property, rights and obligations to heirs through death. The document outlines the key elements of succession including the decedent, heir and estate. It also categorizes the different types of succession, heirs, and persons authorized to manage an estate.
1) The case involved an action for unlawful detainer filed by Consolidated Investments Building Inc. against Domingo Dikit for failure to pay rent.
2) The court found that the action was for unlawful detainer, not forcible entry, as Dikit's initial possession of the premises was lawful under a lease agreement. However, his possession became unlawful after he failed to pay rent.
3) Therefore, the municipal court judge acted in excess of jurisdiction in issuing a writ of preliminary injunction, since unlawful detainer cases fall under the jurisdiction of municipal courts, not regional trial courts.
The document provides samples of basic legal forms used in Philippine courts, including captions, acknowledgments, affidavits, and negotiable instruments. It describes the types of courts established after the Judiciary Reorganization Act of 1980 and provides examples of captions for each court. It also provides templates for acknowledgments, jurats, affidavits, verifications, and certifications. Finally, it includes examples of promissory notes and bills of exchange as samples of negotiable instruments.
This document discusses the special tax treatment of fringe benefits under labor and tax laws. It defines fringe benefits and outlines how they are classified and taxed differently depending on their nature - as regular compensation, supplemental compensation, or incentives. It provides examples of tax-exempt fringe benefits and outlines the scope and categories of fringe benefits that are subject to a final fringe benefit tax. Key terms are defined, such as rank-and-file employees, managerial employees, and de minimis benefits. Guidelines for determining the monetary value and tax base of common fringe benefits like housing and vehicles are also summarized.
Attachment is a legal process that allows a plaintiff's property to be seized before a final judgment to secure potential payment of damages. It serves to acquire jurisdiction over a defendant when service is not possible and to create a lien on a defendant's property until a plaintiff can obtain a judgment. An order of attachment is issued by a court based on an affidavit and bond showing a valid cause of action exists. The property is then seized by a sheriff. A defendant can challenge an attachment by making a deposit or posting a bond. Certain properties are exempt from attachment.
This document provides guidelines for answering questions on the Bar Examination and law school exams, including guidelines for form and substance. For form, it discusses proper formatting of margins, indentation, punctuation, erasures, spacing, concise writing, and legible handwriting. For substance, it recommends directly answering the question in the first paragraph, citing the legal basis in the second paragraph, applying the law to the facts in the third paragraph, and restating the answer in the conclusion. Answers should be logically coherent and follow correct grammar. Overall, the document aims to help examinees effectively communicate their answers.
This document provides an outline for a course on Obligations and Contracts. It covers various topics including the concept of obligations, sources of obligations such as law, contracts, quasi-contracts and acts punished by law. It defines and distinguishes between different types of obligations like pure and conditional, joint and solidary. It also covers topics related to contracts such as essential requisites, interpretation and different types including void, voidable, unenforceable and inexistent contracts.
The Supreme Court affirmed the Court of Appeals' decision remanding the case of ejectment to the regional trial court. It found that the proper action was accion publiciana instead of unlawful detainer, as the respondent's possession of the land portion in question had lasted more than one year. While the petitioner filed the complaint within one year of demanding possession, the respondent had been in possession since 1985, or for over 15 years prior to the complaint. As such, the case involved determining possession rights over a period longer than one year, making it a case for the regional trial court under accion publiciana instead of the municipal court under unlawful detainer.
Succession Course Syllabus by Prof. Alvin ClaridadesHUDCC
This document outlines the course syllabus for a Succession law course taught by Professor Alvin T. Claridades at the UDM College of Law. The syllabus introduces key concepts in Succession law like definitions of succession, heirs, and different types of succession. It also lists 25 cases that will be covered in the course to illustrate these concepts and the application of succession law. The syllabus concludes by outlining the requirements and forms for notarial wills under Philippine law.
The document discusses the rules regarding the inventory and appraisal, allowances for the family, and a related case on these issues.
1) An executor or administrator must return an inventory and appraisal of the deceased's real and personal property within three months, excluding certain personal items for the surviving family.
2) During estate settlement, the widow and minor or incapacitated children shall receive allowances under the court's direction as provided by law.
3) In a related case, the court ruled that the guardianship court did not have authority to enforce payment of widow's allowance, as that power belongs to the court overseeing estate settlement.
This document discusses the characteristics and legal requirements of pledges and chattel mortgages under Philippine law. It defines pledge as an accessory contract where ownership is retained by the debtor and possession is held by the creditor or third party. Chattel mortgages similarly use movable property as security for a debt but involve registration. The document outlines the rights and obligations of parties to pledges and chattel mortgages and how they can be extinguished or foreclosed upon in the event of nonpayment.
Company Policy: Elements of Administrative Investigation and Progressive Disc...PoL Sangalang
Company Policy: Elements of Administrative Investigation and Progressive Discipline.
These are the presentation slides I used in my lecture on the subject on February 15, 2013 at the Asian Institute of Management - Conference Center, Makati City, Philippines. The seminar is sponsored by Ariva! Events Management and co-sponsored by the Rotary Club of Makati McKinley, RI District 3830.
The talk is essentially about employee discipline which can lead to employment termination. The focus of my lecture is on the legal aspect and framework of this employee relations process.
This document provides an overview of corruption and plunder in the Philippines. It defines plunder as amassing ill-gotten wealth of at least 50 million pesos through criminal acts while in a public office. It outlines specific types of corruption prevalent in the country including tax evasion, ghost projects, bypassing public bidding, and extortion. It discusses Republic Act 7080 which penalizes plunder with reclusion perpetua and forfeiture of wealth. Only two people have been convicted of plunder in the Philippines - a BIR cashier in 2001 and former President Joseph Estrada in 2007.
Foreigner's guide to buying real estate in the philippinesgeann123
The document provides information on real estate ownership rules for non-citizens in the Philippines. It discusses that the Philippines constitution restricts non-citizen ownership of private lands, with some exceptions. It outlines ownership options like forming a Philippine corporation with the required citizenship makeup, using a trust with a Filipino trustee, leasing property, or buying under dual citizenship laws or hereditary succession. The document also discusses taxes, deeds, and the legal processes involved in property transactions.
The seller acknowledges receiving full payment of 3.7 million pesos from the buyer for a house and lot located at 100 Virgin Island St. in Mactan Cebu. The payment is net of a 72,000 peso reservation fee that was previously paid and includes all relevant taxes and fees. The seller confirms receiving payment via multiple checks totaling the full amount owed.
This document provides an overview of various crimes committed by public officers under Philippine criminal law. It discusses the elements of malfeasance, bribery, fraud, malversation of public funds, and other offenses. Key points include:
1. To be considered a public officer under the law, one must take part in government functions or duties by direct provision of law, popular election, or appointment.
2. Malversation of public funds involves a public officer misappropriating funds or property for which they are accountable. It can be proven if the officer cannot account for missing funds.
3. Bribery involves a public officer receiving a gift or promise in exchange for performing or not performing an official act.
03 chapter 4 deductions from gross estate part 01Flab Villasencio
The document discusses various deductions that are allowed from the gross estate in arriving at the net taxable estate under Philippine tax law. It covers ordinary and special expenses such as funeral expenses, judicial expenses, casualty losses, claims against the estate, claims against insolvent persons, unpaid mortgages, and unpaid taxes. Examples are provided to illustrate how to compute the allowable deductions for various items such as funeral expenses, judicial expenses, and claims against insolvent persons.
This document provides an overview of key concepts in civil law related to sales, including definitions of sale, contract to sell, conditional sale, barter, dation in payment, and price. It defines a sale as a contract whereby one party transfers ownership of a determinate thing in exchange for a certain price paid by the other party. A contract to sell differs in that ownership is reserved by the seller until full payment of the purchase price. The document outlines essential elements, natural elements, and accidental elements of a sale, as well as characteristics such as being principal, consensual, bilateral, and onerous. It also distinguishes between a sale and related contracts such as agency to sell, contract for piece of work, and
Agrifina Daniel Garcia filed an adverse claim against the registered land title of Norman D. Cabling. Garcia claims to be the real owner of the land according to her own land title. She asserts her signatures were forged on the Deed of Absolute Sale transferring the land to Cabling. Garcia requests the Register of Deeds to register her adverse claim to prevent Cabling from transferring the land to an innocent third party, which would make reconveyance to her impossible. Garcia contracted a lawyer to demand restitution of the land.
This document discusses value-added tax (VAT) coverage and classifications under Philippine law. It states that VAT applies to the sale, lease, or import of goods and services in the course of business, unless exempt or zero-rated, at a 12% rate. Sales are classified as exempt, zero-rated, or taxable. The law requires those engaged in trade to collect VAT on taxable transactions. Specific transactions like property dividends or goods transfers out of business are considered "deemed sales" subject to VAT. Formulas are provided for calculating VAT using exclusive or inclusive tax base methods.
- Estate tax is a tax imposed on the privilege of transmitting property upon the death of the owner. It is levied on the net value of the estate of a deceased person before distribution to heirs.
- The document outlines what is included in the gross estate (e.g. decedent's interest in property, life insurance proceeds, transfers made within 3 years of death), and allowable deductions (e.g. standard deduction of 5M pesos for citizens/residents, claims against the estate, property taxes).
- It also defines key terms like net estate, decedent, and specifies tax rates and who is considered a resident decedent or non-resident alien for tax purposes
This document discusses estate and donor's taxation under Philippine law. It provides definitions and explanations of key concepts such as estate tax, gross estate, property included in the gross estate like transfers with retained interests, transfers in contemplation of death, and life insurance proceeds. It also discusses allowable deductions from the gross estate, the valuation of property, and the rate of estate tax which is now a flat 6% under the TRAIN law. Special deductions like vanishing deductions are also explained along with the requisites to claim such deductions.
1) The case involved an action for unlawful detainer filed by Consolidated Investments Building Inc. against Domingo Dikit for failure to pay rent.
2) The court found that the action was for unlawful detainer, not forcible entry, as Dikit's initial possession of the premises was lawful under a lease agreement. However, his possession became unlawful after he failed to pay rent.
3) Therefore, the municipal court judge acted in excess of jurisdiction in issuing a writ of preliminary injunction, since unlawful detainer cases fall under the jurisdiction of municipal courts, not regional trial courts.
The document provides samples of basic legal forms used in Philippine courts, including captions, acknowledgments, affidavits, and negotiable instruments. It describes the types of courts established after the Judiciary Reorganization Act of 1980 and provides examples of captions for each court. It also provides templates for acknowledgments, jurats, affidavits, verifications, and certifications. Finally, it includes examples of promissory notes and bills of exchange as samples of negotiable instruments.
This document discusses the special tax treatment of fringe benefits under labor and tax laws. It defines fringe benefits and outlines how they are classified and taxed differently depending on their nature - as regular compensation, supplemental compensation, or incentives. It provides examples of tax-exempt fringe benefits and outlines the scope and categories of fringe benefits that are subject to a final fringe benefit tax. Key terms are defined, such as rank-and-file employees, managerial employees, and de minimis benefits. Guidelines for determining the monetary value and tax base of common fringe benefits like housing and vehicles are also summarized.
Attachment is a legal process that allows a plaintiff's property to be seized before a final judgment to secure potential payment of damages. It serves to acquire jurisdiction over a defendant when service is not possible and to create a lien on a defendant's property until a plaintiff can obtain a judgment. An order of attachment is issued by a court based on an affidavit and bond showing a valid cause of action exists. The property is then seized by a sheriff. A defendant can challenge an attachment by making a deposit or posting a bond. Certain properties are exempt from attachment.
This document provides guidelines for answering questions on the Bar Examination and law school exams, including guidelines for form and substance. For form, it discusses proper formatting of margins, indentation, punctuation, erasures, spacing, concise writing, and legible handwriting. For substance, it recommends directly answering the question in the first paragraph, citing the legal basis in the second paragraph, applying the law to the facts in the third paragraph, and restating the answer in the conclusion. Answers should be logically coherent and follow correct grammar. Overall, the document aims to help examinees effectively communicate their answers.
This document provides an outline for a course on Obligations and Contracts. It covers various topics including the concept of obligations, sources of obligations such as law, contracts, quasi-contracts and acts punished by law. It defines and distinguishes between different types of obligations like pure and conditional, joint and solidary. It also covers topics related to contracts such as essential requisites, interpretation and different types including void, voidable, unenforceable and inexistent contracts.
The Supreme Court affirmed the Court of Appeals' decision remanding the case of ejectment to the regional trial court. It found that the proper action was accion publiciana instead of unlawful detainer, as the respondent's possession of the land portion in question had lasted more than one year. While the petitioner filed the complaint within one year of demanding possession, the respondent had been in possession since 1985, or for over 15 years prior to the complaint. As such, the case involved determining possession rights over a period longer than one year, making it a case for the regional trial court under accion publiciana instead of the municipal court under unlawful detainer.
Succession Course Syllabus by Prof. Alvin ClaridadesHUDCC
This document outlines the course syllabus for a Succession law course taught by Professor Alvin T. Claridades at the UDM College of Law. The syllabus introduces key concepts in Succession law like definitions of succession, heirs, and different types of succession. It also lists 25 cases that will be covered in the course to illustrate these concepts and the application of succession law. The syllabus concludes by outlining the requirements and forms for notarial wills under Philippine law.
The document discusses the rules regarding the inventory and appraisal, allowances for the family, and a related case on these issues.
1) An executor or administrator must return an inventory and appraisal of the deceased's real and personal property within three months, excluding certain personal items for the surviving family.
2) During estate settlement, the widow and minor or incapacitated children shall receive allowances under the court's direction as provided by law.
3) In a related case, the court ruled that the guardianship court did not have authority to enforce payment of widow's allowance, as that power belongs to the court overseeing estate settlement.
This document discusses the characteristics and legal requirements of pledges and chattel mortgages under Philippine law. It defines pledge as an accessory contract where ownership is retained by the debtor and possession is held by the creditor or third party. Chattel mortgages similarly use movable property as security for a debt but involve registration. The document outlines the rights and obligations of parties to pledges and chattel mortgages and how they can be extinguished or foreclosed upon in the event of nonpayment.
Company Policy: Elements of Administrative Investigation and Progressive Disc...PoL Sangalang
Company Policy: Elements of Administrative Investigation and Progressive Discipline.
These are the presentation slides I used in my lecture on the subject on February 15, 2013 at the Asian Institute of Management - Conference Center, Makati City, Philippines. The seminar is sponsored by Ariva! Events Management and co-sponsored by the Rotary Club of Makati McKinley, RI District 3830.
The talk is essentially about employee discipline which can lead to employment termination. The focus of my lecture is on the legal aspect and framework of this employee relations process.
This document provides an overview of corruption and plunder in the Philippines. It defines plunder as amassing ill-gotten wealth of at least 50 million pesos through criminal acts while in a public office. It outlines specific types of corruption prevalent in the country including tax evasion, ghost projects, bypassing public bidding, and extortion. It discusses Republic Act 7080 which penalizes plunder with reclusion perpetua and forfeiture of wealth. Only two people have been convicted of plunder in the Philippines - a BIR cashier in 2001 and former President Joseph Estrada in 2007.
Foreigner's guide to buying real estate in the philippinesgeann123
The document provides information on real estate ownership rules for non-citizens in the Philippines. It discusses that the Philippines constitution restricts non-citizen ownership of private lands, with some exceptions. It outlines ownership options like forming a Philippine corporation with the required citizenship makeup, using a trust with a Filipino trustee, leasing property, or buying under dual citizenship laws or hereditary succession. The document also discusses taxes, deeds, and the legal processes involved in property transactions.
The seller acknowledges receiving full payment of 3.7 million pesos from the buyer for a house and lot located at 100 Virgin Island St. in Mactan Cebu. The payment is net of a 72,000 peso reservation fee that was previously paid and includes all relevant taxes and fees. The seller confirms receiving payment via multiple checks totaling the full amount owed.
This document provides an overview of various crimes committed by public officers under Philippine criminal law. It discusses the elements of malfeasance, bribery, fraud, malversation of public funds, and other offenses. Key points include:
1. To be considered a public officer under the law, one must take part in government functions or duties by direct provision of law, popular election, or appointment.
2. Malversation of public funds involves a public officer misappropriating funds or property for which they are accountable. It can be proven if the officer cannot account for missing funds.
3. Bribery involves a public officer receiving a gift or promise in exchange for performing or not performing an official act.
03 chapter 4 deductions from gross estate part 01Flab Villasencio
The document discusses various deductions that are allowed from the gross estate in arriving at the net taxable estate under Philippine tax law. It covers ordinary and special expenses such as funeral expenses, judicial expenses, casualty losses, claims against the estate, claims against insolvent persons, unpaid mortgages, and unpaid taxes. Examples are provided to illustrate how to compute the allowable deductions for various items such as funeral expenses, judicial expenses, and claims against insolvent persons.
This document provides an overview of key concepts in civil law related to sales, including definitions of sale, contract to sell, conditional sale, barter, dation in payment, and price. It defines a sale as a contract whereby one party transfers ownership of a determinate thing in exchange for a certain price paid by the other party. A contract to sell differs in that ownership is reserved by the seller until full payment of the purchase price. The document outlines essential elements, natural elements, and accidental elements of a sale, as well as characteristics such as being principal, consensual, bilateral, and onerous. It also distinguishes between a sale and related contracts such as agency to sell, contract for piece of work, and
Agrifina Daniel Garcia filed an adverse claim against the registered land title of Norman D. Cabling. Garcia claims to be the real owner of the land according to her own land title. She asserts her signatures were forged on the Deed of Absolute Sale transferring the land to Cabling. Garcia requests the Register of Deeds to register her adverse claim to prevent Cabling from transferring the land to an innocent third party, which would make reconveyance to her impossible. Garcia contracted a lawyer to demand restitution of the land.
This document discusses value-added tax (VAT) coverage and classifications under Philippine law. It states that VAT applies to the sale, lease, or import of goods and services in the course of business, unless exempt or zero-rated, at a 12% rate. Sales are classified as exempt, zero-rated, or taxable. The law requires those engaged in trade to collect VAT on taxable transactions. Specific transactions like property dividends or goods transfers out of business are considered "deemed sales" subject to VAT. Formulas are provided for calculating VAT using exclusive or inclusive tax base methods.
- Estate tax is a tax imposed on the privilege of transmitting property upon the death of the owner. It is levied on the net value of the estate of a deceased person before distribution to heirs.
- The document outlines what is included in the gross estate (e.g. decedent's interest in property, life insurance proceeds, transfers made within 3 years of death), and allowable deductions (e.g. standard deduction of 5M pesos for citizens/residents, claims against the estate, property taxes).
- It also defines key terms like net estate, decedent, and specifies tax rates and who is considered a resident decedent or non-resident alien for tax purposes
This document discusses estate and donor's taxation under Philippine law. It provides definitions and explanations of key concepts such as estate tax, gross estate, property included in the gross estate like transfers with retained interests, transfers in contemplation of death, and life insurance proceeds. It also discusses allowable deductions from the gross estate, the valuation of property, and the rate of estate tax which is now a flat 6% under the TRAIN law. Special deductions like vanishing deductions are also explained along with the requisites to claim such deductions.
Trustees have both powers and duties. Their powers include selling trust property, insuring assets, compounding liabilities, maintaining and advancing funds to beneficiaries. Their key duties are to protect trust assets, treat beneficiaries equally, provide beneficiaries with account information, and properly distribute trust funds. Trustees must exercise their powers and duties with care, skill, prudence and in the sole interest of beneficiaries.
- Insurable interest requires that the insured has a financial stake in the insured subject both at the start and at the time of loss. This differs from gambling.
- Utmost good faith requires full disclosure of all material facts and maintains throughout the contract period. Failure to do so through non-disclosure or misrepresentation makes the contract voidable.
- The insurer's liability is generally limited to indemnifying the insured for their actual financial loss up to the sum insured under the policy terms. Subrogation and contribution principles apply when multiple parties are liable for the loss.
- Insurance requires an insurable interest, which is a financial interest in the subject matter being insured. This interest must exist when the policy is issued and when a loss occurs.
- The duty of utmost good faith requires applicants and policyholders to disclose all material facts truthfully. Non-disclosure or misrepresentation can make a policy voidable.
- The principle of indemnity means that insurance pays to restore the insured to the same financial position as before a loss, not to benefit from a loss. Payments are made through cash, repair, replacement or reinstatement up to the sum insured or policy limits.
- Subrogation and contribution allow insurers to recover costs from responsible third
Claims Processing & Administration in General InsuranceAjibola Ibukunolu
This document is a term paper on claims processing and administration in general insurance. It discusses key terms related to claims management, the typical claims procedure, and the importance of effective claims management for insurance companies. The claims procedure involves claim notification, inspection, appointing a loss adjuster, generating reports, communicating the settlement or repudiation, resolving disputes, delivering settlement, retrieving salvage, and applying contribution and subrogation. Good claims management is important as it improves customer satisfaction, reduces advertising costs, changes public perceptions of insurance, and attracts more customers and economic benefits.
02 Chapter 3 and 4 Clarifications Resolved Taxation 2Flab Villasencio
A general power of appointment allows the holder to designate who receives property from a prior decedent through will or deed, including the ability to transfer the property to themselves, their estate, or creditors. In contrast, a special power of appointment only authorizes transferring the property to a restricted class of people, not including the holder themselves. Property subject to a general power of appointment is included in the holder's gross estate for estate tax purposes, while property subject to a special power of appointment is not.
This document discusses key principles of insurance, including insurable interest, subject matter of insurance, assignment of policies, utmost good faith, proximate cause, indemnity, subrogation, and contribution. It defines these terms and explains concepts like when insurable interest must exist, exceptions to free assignment of policies, the duration of utmost good faith, factors limiting indemnity, and conditions required for contribution between insurers.
As Interest Rates Rise, So Do Mortgage Foreclosuresrmiller1
The document discusses mortgage foreclosures. It explains that a mortgage is a security interest in a property that secures a debt, and if the debt is not paid, the lender can foreclose on the mortgage through a legal process to recover the property or the balance of the debt. The foreclosure process involves filing a legal case, notifying all interested parties, obtaining a judgment if the debt is not paid, setting a sale date for the property, and conducting a public auction. The lender is not guaranteed to regain the property, as it must bid at least the judgment amount and someone could outbid them.
The document discusses types of pure risk and the difference between pure and speculative risk. It also discusses the underwriting process for life insurance. Key points:
- Pure risks include property risk, personal risk, liability risk, and loss of income risk. Pure risks have only two outcomes - loss or no loss, with no possibility of gain.
- The underwriting process for life insurance involves gathering application information, medical reports, reviewing risk, and writing the policy if accepted. It aims to determine premium rates based on risk profile.
- Changes to the IRDA Investment Amendment Regulations in 2001 included balancing infrastructure and social sector investments that were rated AA or higher. It also set minimum investment grade requirements of AA or A
This document provides an overview of insurance and risk management concepts. It discusses key topics such as the basic principles of insurance, types of insurance, regulation of the insurance industry in Malaysia, and consumer protection. Some key points include:
- Insurance involves sharing individual losses among a group facing similar risks through a loss-sharing arrangement. It relies on the law of large numbers.
- The primary function of insurance is to equitably spread financial losses among many insured individuals. Secondary functions include cost stabilization, stimulating business, and providing employment.
- There are two main classes of insurance: life insurance and general insurance. General insurance covers all other types besides life insurance, such as motor, marine, and products liability insurance.
Sharing with you my dear readers who may find it useful.
Feel free to connect with me at maxermesilliam@gmail.com.
P/S: taken the insurance exam but has yet to practice as an insurance agent.
The document discusses various types of borrowings against property in India. It begins by defining a loan against property, where a borrower uses their property as collateral to secure a loan. It then describes different types of property-backed loans like pledge, hypothecation, lien, and various types of mortgages. Key terms like mortgagor, mortgagee and registration charges are also explained. The rights and liabilities of parties in property-backed loans are discussed at the end.
This document discusses resulting trusts, which arise in the absence of express trusts when the beneficial interest returns to the settlor. There are two types of resulting trusts: automatic resulting trusts, which arise whenever the beneficial interest has not been fully disposed of by an express trust; and presumed resulting trusts. Automatic resulting trusts occur in situations like when an express trust fails due to lack of formalities, an incomplete disposal of the beneficial interest, or other reasons. Surplus funds from unincorporated associations may also result in a resulting trust, with courts determining on a case-by-case basis whether the surplus reverts back to contributors under a resulting trust or is distributed contractually.
1. Insurance companies must collect sufficient premiums to cover expected losses, operating expenses, reserves for unexpected losses, and allow for investment income.
2. Key factors that determine premium prices include the cost of losses, cost of doing business, cost of capital reserves, and contributions to catastrophe reserves.
3. Insurance provides benefits like stability for families and businesses, facilitates credit, and allows for savings and investment in the economy. It also reduces costs and promotes loss prevention.
The document discusses claim management and reinsurance in the insurance industry. It covers topics such as the claim settlement process, types of claims including maturity, death and survival benefits, documents required for different claim types, procedures for settling claims, the role of third party administrators, and qualifications for CEOs and CAOs of third party administrators. It emphasizes the importance of prompt claim settlement and outlines the various stages in assessing, processing and paying out on insurance claims.
This document provides an overview of life estates as an investment option. It defines a life estate as a legal arrangement where the owner has possession of a property during their lifetime, after which ownership transfers to an appointed remainderman. Some key points covered include:
- Life estates can be used to avoid the probate process and automatically transfer property to remaindermen.
- Both life tenants and remaindermen have certain rights and responsibilities regarding the property.
- Common reasons for investing in a life estate include leaving a property to heirs and avoiding probate.
- Investors must consider costs of maintaining the property and ensuring it can be passed to remaindermen.
- The presentation materials were researched to educate about all aspects of life
HUD Reporting Losses and Reporting Loss Claims and Insurance SettlementsEbony Hall
The document provides guidelines for mortgagors regarding reporting property losses and processing insurance claims and settlements. It instructs mortgagors to immediately report losses to their insurance company and HUD or mortgagee to file claims. It also specifies that restoration requires authorization and oversight from the insurer and HUD/mortgagee. Finally, it outlines procedures for endorsing and submitting loss drafts/checks to the mortgagee or HUD, accompanied by certifications, and taking steps to prevent future losses.
The document discusses the benefits of establishing a living trust. It states that a living trust can protect and preserve one's assets while alive, allow for medical and financial decisions if incapacitated, and reduce costs and time for heirs to receive assets by avoiding probate. It notes that probate is a public court process that on average costs 10% of the gross estate, takes 6 months to 2 years, and causes stress for executors and heirs. In contrast, a living trust privately transfers assets outside of probate at low or no cost, quickly within 1-3 days, and brings peace of mind.
ppt - Business Services.fhfhthghnghngngngngfnasurana1403
1. The document discusses various types of bank accounts and services including savings accounts, current accounts, recurring deposit accounts, fixed deposit accounts, and multiple option deposit accounts. It also discusses key banking services like bank drafts, overdrafts, and cash credits.
2. The main types of insurance discussed are life insurance, fire insurance, marine insurance, and health insurance. For each type, the document outlines some of the key principles, for example noting that life insurance is not a contract of indemnity while fire and marine insurance are.
3. The document also discusses various business services provided by banks, insurance companies, and other sectors. It distinguishes between business, social, and personal services.
Genocide in International Criminal Law.pptxMasoudZamani13
Excited to share insights from my recent presentation on genocide! 💡 In light of ongoing debates, it's crucial to delve into the nuances of this grave crime.
Sangyun Lee, 'Why Korea's Merger Control Occasionally Fails: A Public Choice ...Sangyun Lee
Presentation slides for a session held on June 4, 2024, at Kyoto University. This presentation is based on the presenter’s recent paper, coauthored with Hwang Lee, Professor, Korea University, with the same title, published in the Journal of Business Administration & Law, Volume 34, No. 2 (April 2024). The paper, written in Korean, is available at <https://shorturl.at/GCWcI>.
Safeguarding Against Financial Crime: AML Compliance Regulations DemystifiedPROF. PAUL ALLIEU KAMARA
To ensure the integrity of financial systems and combat illicit financial activities, understanding AML (Anti-Money Laundering) compliance regulations is crucial for financial institutions and businesses. AML compliance regulations are designed to prevent money laundering and the financing of terrorist activities by imposing specific requirements on financial institutions, including customer due diligence, monitoring, and reporting of suspicious activities (GitHub Docs).
Corporate Governance : Scope and Legal Frameworkdevaki57
CORPORATE GOVERNANCE
MEANING
Corporate Governance refers to the way in which companies are governed and to what purpose. It identifies who has power and accountability, and who makes decisions. It is, in essence, a toolkit that enables management and the board to deal more effectively with the challenges of running a company.
1. Based on UP and AteneoLaw ReviewersandPM ReyesBar Reviewer
Estate Tax
Estate tax- graduatedtax imposeduponinthe privilege of the decedenttotransmitpropertyatdeath
and isbasedon netestate,consideredasa unit,anddeterminedbysubtractingallowable deductions
fromthe gross estate.
Nature
1. Excise of privilegetax
2. Imposedonrightto succeed,receive,take property
3. Under a will orintestancylaw
4. Deed,grantor gift
5. Become operative atorafter death
Purpose
1. Objectof estate tax- tax shiftingof economicbenefitsandenjoymentof propertyfromdeadto
living
2. Give addedincome tothe government
Justification Time Taxable transfers
1. Benefitreceivedtheory
2. Privilegetheoryorstate
partnershiptheory
3. Abilitytopaytheory
4. Redistributionof
wealththeory
Decedent’sinterestistoits
extentatthe time of his death
regardlessif itisindicatedina
will thatsellingordisposition
of hispropertyshouldbe 10
yearsafterhisdeath.
It shouldbe measuredbythe
value of the estate as itstood
at the time of the decedent’s
death,regardlessif any
postponementof actual
possessionoranysubsequent
increase ordecrease invalue.
(Lorenzovs.Posadas
1. Transfermortiscosa
2. Transferintervivos
a. Contemplationof
death
b. Transferwith
retentionor
reservationof certain
rights
c. Revocable transfers
d. Transferof property
arisingundergeneral
powerof
appointment
e. Transferfor
insufficient
consideration
2. Estate tax Donor Tax
transferswithoutonerousconsideration transferswithoutonerousconsideration
Tax on the privilegetotransferpropertyupon
one’sdeath(mortis causa)
Tax on the privilegetotransferpropertyduring
one’slifetime (intervivos)
Max tax rate of 20% on netestatesexceedingP10
millionandthe firstP200,000 is exempt
Max tax rate is15% onthe netgiftsexceeding
P10 millionandfirstP100,000 is tax exempt
Residence-permanenthome
Gross estate- value of all property,real orpersonal,tangible orintangible,actual andbeneficial
ownershipof whichwasinthe decedentatthe time of hisdeath
Netestate=grossestate – all deductions
Citizen/ResidentAlien Non- ResidentAlien
WithinandwithoutRP WithinRPonlyexcept:
1. Intangible personal propertyinthe
Philippines- unlessexemptedonbasisof
the principle of reciprocity
2. Intangible personal propertyoutsidethe
RP
Intangible Properties withinRP
1. Franchise exercisedinRP
2. Share,obligationorbondissuedbyRPonly
3. Share,obligationorbondissuedbyanyforeigncorporation85% of businessinRP
4. Share,obligationsorbondissuedbyforeigncorporationwithbusinesssitusinRP
5. Share or rightsin any businessestablishedinRP
3. Reciprocityclause (there must be total reciprocity,CIR vs Fisher)
Intangible personal propertyof adecedentwhoisanon-residentalien,withasitusinRPshall notform
part of the grossestate if:
1. The decedentatthat time of hisdeathwas a citizenandresidentof aforeigncountrywhichat the
time of hisdeath
a. Didnot impose atransfertax or deathtax of any character
b. Inrespectof the intangible personal propertyof citizensof the Philippinesnotresidinginthatforeign
country
2. law of foreigncountrywhichthe decedentwasacitizenandresidentatthe time of hisdeath:
a. allowa similarexemptionsfromtransfertaxesordeathtaxesof everycharacter
b. inrespectof the intangiblepersonalpropertyownedbycitizensof the Philippinesnotresidinginthat
foreigncountry.
Valuation
Real property=FMV byCommissionerof FMV by assessorswhicheverishigher
Personal Property=FMV at time of death
Shares of stocks
1. Listedshares=average of highestandlowestquotationdate nearesttodeath
2. Unlistedshares=commonsharesbookvalue;preferredshares=parvalue
3. Rightto usufruct,use or habitationannuity=DOF,ICapproved;latestbasicstandardmaturity
table
Includedin the gross esate
1. Actuallyandphysicallypresentpropertiesattime of death
2. Decedent’sinterest
3. Notphysicallypresent
a. Transferincontemplationof death
b. Transferwithretentionorreservationof certainrights
c. Revocable transfers
d. PropertypassingunderaGPA
e. Transfersforinsufficientconsideration
f. Proceedsof life insurance
g. Claimsagainstinsolventpersons
h. Capital of survivingspouse
4. Property ownedactually and physicallypresentat death- lands,buildings,sharesof stocks,vehicles,
bankdeposits,etc.
Decedent’s interest-dividendsetc.
Not physicallypresent
1. Transfersincontemplationof death
- Motivatingfactoror controllingmotive isthe thoughtof death
- Notapplicable if bonafide sale foranadequate
2. Transferswithretention/reservationof certainrights- transferduringlife butstill retain
economicbenefits;exceptbona fide sale
Illustration-XtransfershispropertytoY innakedownershipandtoZ in usufructthroughoutZ’slifetime.
It issubjectto the conditionthatif Z predeceasesX,the propertyshall returntoX.If X diesduringX’s
life,the value of the reversionaryinterestof Xat deathis includible inhisgrossestate.The transferis
taxable asintendedtotake effectator afterdeathbecause the possibilityof reversiontoXmake Z’s
interestconditional aslongasX lives.
Revocable transfers- Decedent’stransferof onlyinterestbytrustor otherwise,where the enjoyment
thereof wassubjectatthe date of hisdeathto any change throughthe exercise of powerbythe
decedentALONEorby the decedentIN CONJUNCTION WITHANYOTHER PERSON,toALTER, AMEND,
REVOKEor TERMINATE suchtransferor where suchpowerwhichwouldbringthe propertyinthe
taxable estate isrelinquishedincontemplationof the decedent’sdeath.
Except:Bona fide sale foranadequate andfull consideration
Power to alter,amend or revoke existeventhough:
1. Exercise of the powerissubjecttoa precedentgivingof notice or
2. Alteration,amendmentorrevocationtakeseffectonlyonthe expirationof astatedperiodafter
the exercise of the power,whetherornoton or before the date of the decedent’sdeathnotice
has beengivenorthe powerhasbeenexercised.-if notgivenbefore date of death,itshall be
consideredasdeemedgiven/exercisedondate of death.
GPA- appointanypersonhe pleases
SPA- restrictedordesignatedclassof personsotherthanself- propertybySPA excludedfromgross
estate
Gross estate includesGPA if:
1. By will
2. By deedexecutedincontemplationof orintendedtotake effectinpossessionorenjoymentat,
or afterhisdeath,or
3. By deedwhichhe retained:
5. a. Possessionorenjoymentorrighttothe income from, propertyor
b. Right,eitheralone orinconjunctionwhichanypersontodesignate the personswhoshall
possessorenjoythe propertyorthe income therefrom
Except:bonafide sale foran adequate andfull consideration
Transferfor insufficientconsiderationwill be includedif: (includible amountisexcessof the FMV at the
time of deathoverthe value of the considerationreceived)
1. In contemplationof death
2. Revocable transfer
3. GPA property
Otherwise itwillbe consideredfordonor’stax computation
Case A bonafide- novalue shall be includedinthe grossestate
Case B notbonafide excessof FMV part of Grossestate
Case C provenfictitious/simulated- total value of propertyattime of deathincludedingrossestate
Proceedsof life insurance taxable
1. Beneficiaryisthe estate of the deceased,hisexecutororadministrator,irrespectiveof whether
or not the insuredretainedthe powerof revocation
2. Beneficiaryisotherthanthe decedent’sestate,executororadministrator,whendesignationof
beneficiarynotexpresslymade irrevocable
Proceedsof life insurance nottaxable
1. Accidentinsurance proceeds
2. Proceedsof a groupinsurance policy(Mortgage redemptioninsurance-MRI) takenoutbya
companyfor itsemployees
3. Amountreceivablebyanybeneficiaryirrevocablydesignatedinthe policyof insuranceby
the insured.The transferisabsolute andthe insureddidnotretainanylegal interestinthe
insurance
4. Proceedsof insurance policiesissuedbythe GSIStogovernmentofficialsandemployees
whichare exemptfromall taxes
5. Benefitsaccruingunderthe SSSlaw
6. Proceedsof life insurance payable toheirsof deceasedmembersof militarypersonnel
Policy before marriage- sourcesof fundsdetermineownershipof the proceedsof life insurance
Policytakenduringmarriage
a. Beneficiaryisestate of the insured- presumedconjugal;½share of the survivingspouse isnot
taxable
6. b. Beneficiaryis3rd
person- proceeds are payable tobeneficiary evenif premiumswerepaidoutof
conjugal
Prior interests
I. transferincontemplationof death
Nota transferincontemplationof deathif:
1. desire tosee hischildrenenjoythe propertywhilethe donorisstill alive
2. Save income or propertytaxes
3. Settle familydisputes
4. Relieve donorfromadministrative burden
5. Rewardservicesrendered
6. Provide independentincomefordependents
II. Revocable transfers
III.Proceedsof life insurance
Residentor citizendecedent Non-residentaliendecedent
Gross Estate (all propertieswithinand
withoutRP
Less:Deductions
1. Ordinarydeductions- ELIT(expenses,
losses,indebtedness,taxes)
a. Funeral
b. Judicial
c. Claimsagainstestate
d. Claimsagainstinsolventperson
e. Unpaidmortgage and debt
f. Taxes
g. Losses
2. Vanishingdeductions
3. Transfersforpublicuse
4. AmountsreceivedunderRA 4917
5. Special deductions
a. FamilyHome
b. StandardDeduction
c. Medical Expenses
6. Share in conjugal property
Gross Estate locatedinRP property
Less:Deductions
1. Ordinary deductions- Proportionate
ELIT
a. Funeral
b. Judicial
c. Claimsagainstestate
d. Claimsagainstinsolventpersons
e. Unpaidmortgage and debt
f. Taxes
g. losses
2. vanishingdeductions
3. transfersforpublicuse
4. amountreceivedunderRA 4917
5. share in conjugal property
7. *NRA= Gross estate phil/grossestateworldXworldexpenses,losses,indebtedness,taxes,
etc.
Funeral Expense-notexceedP200,000 and whicheverislowerinactual funeral expense or
5% of grossestate.
1. Mourningapparel
2. Expensesof the wake
3. Publicationcharges
4. Telecommunicationsexpenses
5. Cost of burial plot,tombstones,monumentormausoleum
6. Intermentand/orcremationfeesandcharges
7. Ritesandceremoniesincidenttointerment
Notdeductible- afterinterment,borne ordefrayedbyrelativesandfriends,medical expenses
Example:
1. 5% is P220,000 and actual amountis P215,000- max deductibleif P200,000
2. 5%- P100,000 and total amountis P150,000 withP20,000 still unpaid – deductibleisP100,000
Judicial expenses- Withreceiptsandinvoicesorswornstatementof account
1. Inventory- takingorcollectionof assets
2. Comprisingestate,theiradministration
3. Duringthe settlementof estate butnotbeyondthe lastdayprescribedbylaw orfor filing of
estate tax return
Example of Judicial expenses
1. Actual judicial orcourt expenses
2. Feesor executororadministrator
3. Attorney’sfees
4. Expensesof administrationsuchas:
a. Accountant’sfees
b. Appraiser’sfees
c. Clerkhire
d. Cost of preservinganddistributingthe estate
e. Cost of storingor maintainingpropertyof the estate
f. Brokerage fees forsellingpropertyof the estate
5. Notarial fee
Claimsagainst estate
1. Debtsor demandsof a pecuniarynature
2. Couldhave beenenforcedagainstthe deceasedinhislifetimeandcouldhave beenreducedto
simple moneyjudgment
8. 3. Contract,tort or operationof law
4. Dulynotarizedexceptif grantedbyfinancial institutions
5. Loan was contractedwithin3yearsbefore deathof decedent,administratororexecutorshall
submita statementunderoathshowingthe dispositionof the proceedsof the loan
To be deductible itshouldbe (PVNGF)
1 Personal obligation
2 Good faith
3 Validinlaw
4 Enforceable incourt
5 Noncondonedor notprescribed
Claimsagainst insolventpersons
1. Notcollectible
2. Shouldbe provenalthoughjudicial declarationnotrequired
Unpaidmortgages
1. Gross estate mustinclude fairmarketof propertyencumberedbysuchmortgage or
indebtedness
2. Deductionshall be limitedtothe extentthattheywere contractedbonafie andforan adequate
and full considerationinmoneyormoney’sworth,if suchunpaidmortgagesorindebtedness
were foundedupontopromise oran agreement
Taxes- accrued and unpaidatdeath
Thisdeductiondoesnotinclude incometax uponincome receivedafterdeath,orpropertytaxes
accrued afterhisdeath,or the estate tax due fromthe transmission of hisestate
Losses
1. Incurredduringsettlementof estate
2. Fortuitouseventslike fires,storms,etc
3. Notcompensatedbyinsurance orotherwise
4. Lossesnotclaimedas a deductionforincome tax purposesinanincome tax returnof the estate
subjecttoincome tax
5. Notlaterthan the last dayfor paymentof the estate tax (6 monthsafterthe deathof the
decedent)
6. Properlypreviouslytaxed- vanishingdeductions
Example:A diedinDecember2003, March 2003
B (A’sfatherdied) andleftA same propertiesasinheritance
9. Vanishingdeductionsapplicable aslongasPINID
a. Death
b. Identityof the property
c. Locationof the property
d. Inclusionof the property
e. Previoustaxationof the property
f. No previousvanishingdeduction
Example:
A inherited P870000
Subtract mortgage 70000
Initial basis P800000/total amount* ordinaryexpenses*
multiplywithvanishingdeductionrate
Vanishingdeductionrate
100% 1 yr priorto the death(inheritance orgift) of the
presentdecedent
80% More than 1 yr to2 yr
60% More than 2 yr to3 yr
40% More than 3 yr to4 yr
20% More than 4 yr to5 yr
Special deductions
Familyhome- maximumof P1M
1. Dwellinghouse
2. Actual residentialhome
3. Value of familyhome partof grossestate
4. FMV currentnot exceedP1M
5. Married or headof the family
6. Beneficiariesdwellinginfamilyhome
7. Ownedbydecedent
Beneficiariesof familyhome
a. Husband,wife,headof family
b. Parents,ascendants,descendants
c. Brothersand sisters
10. Medical expenses- max P500k
a. 1 yr priorto death
b. Withreceiptsanddocuments
Netshare of survivingspouseinthe conjugal partnership
Property- ½of 50%
Transfer for PublicUse
1. the dispositionisinthe lastwill andtestament
2. take effectafterdeath
3. in favorof the governmentof the Philippinesoranypolitical subdivisionthereof
4. exclusive forpublicpurpose
5. value of propertygivenisincludedinthe grossestate.
Exemptionsand exclusionsfromgross estate
1. Capital/paraphernal of survivingspouse
2. Propertyoutside RPof non-residentaliendecedent
3. Intangible personal propertyin the Philippinesof anon-residentalienif thereisreciprocity
4. Merger of usufructof nakedtitle owner
5. Transmissionordeliveryof inheritance orlegacybyfiduciaryheirtofideicomissary
6. Transmissionfrom1st
heir,legatee ordone infavorof anotherbeneficiary
7. Bequests,devices,legaciesortransferstosocial welfare,cultural andcharitable institutions,no
part of the netincome of whichinurestothe benefitof anyindividuals- notmore than30% used
for administrationpurposes
Exclusionsunderspecial laws
1. Proceedsof life insurance benefitsreceivedbyGSISmembers
2. SSS
3. Damagesfromlast war
4. US VeteransAdministration
Tax Credit- remedyagainstinternational doubletaxation
Notice of deathto BIR- within2 months
11. Estate tax return
a. Estate subjectto estate tax
b. ExceedP200K
c. Registered/registrable property (AAB,RDO,collectionofficer)
Donor’s Tax
Donor’stax
a. Intervivos
b. Made betweenlivingpersonstotake effectduringthe lifetimeof the donor
c. Supplementsestate tax
d. Completedgiftbefore application
e. Preventavoidance of income tax throughthe device of splittingincome amongnumerous
donees,whoare usuallymembersof afamilyorintomany trusts,withthe donorthereby
escapingeffectof progressive ratesof income tax
f. Raise revenues,tax wealthyandreduce certainotherexcise taxes,discourageintervivos
transfers,reduce incentive tomake giftsinorderthatdistributionof future income
ValidDonation(RequisitesCIDA)
a. Capacityto donate of donor
b. Intentto donate
c. delivery
d. Acceptance of done
Incomplete giftbecauseof reservedpowersbecome complete if donorrenouncespowerorrightto
exercise reservedpowerceases
Pirovanovs.CIRdoctrine-The donationisnotremuneratoryasA has beenfullycompensatedforhis
services.A donationmade bythe corporation tothe heirsof a deceasedofficeroutof gratitude forthe
officer’spastservicesisconsideredadonationandissubjectto donee’sgifttax.The factthat his
servicescontributedinalarge measure tothe successof the company did notgive rise to a recoverable
debt,andthe conveyancesmade bythe companytohisheirsremaina giftor donation.
Validdonation of a movable
1. oral or writing(if more thanP5000, donationandacceptance in writing)
2. delivery
12. Validdonation of an immovable
1. publicdocument
2. specified
3. Acceptance througha deedor similarinstrument
Transfer which may be constitutedas donation
a. Sale/exchange/transferof propertyforinsufficientconsideration- propertysubjecttofinal
capital gainstax buttransferredforlessthanan adequate andfull considerationin
money/money’sworth
FMV of property>value of agreedor actual considerationorsellingprice
Shall be deemedagift
b. Condonation/permissionof debt- debtordidnotrender
Service infavorof the creditor
FMV> GSP- capital gainstax
Real propertyconsideredcapital assetsare excepted
Examples:
1. A soldhislot to hisbrotherforP500,000. FMV P1M. A bought itfor P100,000. Sharessoldat
P300,000; FMV P500,000 and boughtP100,000.- Lot notsubjectto donor’stax it isa real property
classifiedascapital assetandsubjectto6% CGT. Sharesare subjectto30% donor’stax basedon the
difference betweenthe sellingprice andmarketvalue.
2. CreditorsA,B and C condoneddebtof XYZ corporationdue to restructuring- Notsubjecttodonor’s
tax since condonationwasnotimplementedwithadonative intentbutonlyforbusinessconsideration.
Restructuringnotresultof mutual agreementbetdebtorandcreditorbutthroughcourtaction of debt
rehabplan.
3. Transferthrough special purpose vehicle (SPV)-notsubjecttodonation
4. Renunciationof hereditaryshare of B inA’sestate forX who isa special child- Yesdonor’stax.
Renunciationwasspecificallyandcategoricallydone infavorof X and identifiedheirtothe exclusionor
disadvantage of otherheirsinthe hereditaryestate. If notspecificallyorcategoricallydone,notsubject
to donor’stax.
Intangible property rules(same with that inEstate)
Classifications
a. Citizen/resident- all withinandwithoutRP
b. Non-residentalien-withinRPonly
13. Reciprocityandintangiblepropertyrules- see Estate
Determinationof GrossGift
a. Real and personal propertygifts
b. Real and tangible personalpropertygifts
Compositionofgross gift- intervivosdonations
1. Transferisin trustor otherwise
2. Giftis director indirect
3. Real,personal,tangible orintangible
Valuationof gifts;amountof gift=FMV at time of donation
Real property=zonal value orlatestschedule of valuesof the provincialandcityassessor- whicheveris
higher
Improvement-constructioncostperbuildingpermitand/oroccupancypermitplus10% per yearafter
yearof constructionof FMV perlatesttax declaration
Computationof donor’stax
Gross giftmade
-deductionsfromgrossgifts
Netgiftsmade
*multipliedbyapplicable rate
Donor’stax onthe netgifts
If several gifts
Gross giftsmade or thisdate
Less:Deductionsfromgrossgifts
Netgiftsmade on thisdate
Add:all prior netgiftsduringthe year
Aggregate netgifts
Multipliedbyapplicablerate
Donor’stax onthe aggregate netgifts
Less:donor’stax paidonprior netgifts
Donor’stax due onthe netgiftsto date
Tax rate applicable=graduated,howeverif stranger,then30% of netgifts
Strangeris
1. Nota brother,sister(whole/half-blood),spouse,ancestororlineal descendant
2. Nota relative consanguinityinthe collateral line within4th
degree of relationship
14. Limitationsontax credit:
1. Netgift(foreigncountry)/entire netgifts*Philippine donor’stax
2. Netgift(all foreigncountries)/entire netgifts*Philippine donor’stax
Exemptions
1. Dowriesordonationsmade (max P10k)
a. On account of marriage
b. Before itscelebrationorwithin1yr
c. By parentsto eachof theirlegitimate,recognized,natural oradoptedchildren
d. To the extentof the 1st
P10k
e. Notbe availedbynon-residentalien
If both parentsdonated=½ to eachdonorspouse (separate filing)
2. National governmentuse
3. Educational,charitable,religious,cultural orsocial welfare(notmore than30% for
administrationpurpose)
File within30days- donor’stax return
15. VAT
Concept
1. Percentage tax onsale,barter,exchange orlease of goods,properties,services
2. Output- inputtax=VAT
3. Excise tax=privilege tax
4. Ad valoremtax=grossvalue or GSP inmoneyof goods and services
Characteristics
1. Tax on consumptionleviedonthe sale,barter,exchange orlease of goodsorpropertiesand
servicesinthe Philippinesandonimportationof goofsintoRP
2. Indirecttax
3. Notoppressive,arbitraryandconfiscatory
4. Uniform
5. Equitable
6. Regressive
Impact of taxation- statutorypayer,sellerorimporter,one whomgovernmentcollects
Incidence of taxation- bearsburden;final consumer
Tax creditmethod- inputtaxesshiftedbythe sellerstothe buyerare creditedagainstthe buyer’s output
taxeswhenhe inturn sellsthe taxable goods,propertiesorservices
DestinationPrinciple- jurisdictional reachof VAT,where countrytheyare consumed
CrossBorder Doctrine- noVATshall be imposedtoformpart of the cost of the goodsdestinedfor
consumptionoutsidethe territorialborderof the taxingauthority
Personsliable:
1. sells,barters,orexchangesgoodsorproperties(sellerortransferor)
2. leasesgoodsor properties(lessor)
3. Rendersservices(service provider)
4. Import goods(importer),whetherornotmade in the course of trade or business
Absence of thiswill not be subjectto VAT reimbursable (CIRvs Sony)
Sale of parking lot not includedinsale of condominiumunit (RR 13-2012)
16. Ecozones
1. Separate customsauthority
2. Legal fictionof foreignterritory
3. Zero-rated
4. Same treatmentwithcustomsterritory- also0% VAT
2 typesof Zero-ratedtransactions
1. Automatic- referstoexportsale of goods,propertiesandsupplyof servicesbyaVAT-registered
person
2. Effective- referstolocal sale of goodsand propertiesbyaVAT-registeredperson toa personor entity
whowas granteddirectand indirecttax exemptionunderspeciallawsorinternational agreements
To be entitledto refundas in the case ofSitel vs CIR:
1. zero-ratedoreffectivelyzero-ratedsales
2. inputtaxeswere incurredorpaid
3. such inputtaxesare directlyattributable tozero-ratedoreffectivelyzero-ratedsales
4.inputtaxeswere notappliedagainstanyoutputVATliabilityand
5. claimfor refundwasfiled withinthe 2-yearprescriptive period
Customsterritory- national territoryof the Philippinesoutsideof the proclaimedboundariesof the
ECOZONEsexceptthose areasspecificallydeclaredbyotherlawsand/orpresidentialproclamationsto
have the status of special economiczonesand/orfree ports
a. Sale of servicesbyecozone enterprise,toanotherecozone enterprise(intra-ecozone),
enterprise (sale of service)
- PEZA registeredsubjectto5% special tax regime (exemptfromVAT)
- If PEZA registeredsubjectto tax underNIRC=0% VATunderCROSSBORDER DOCTRINE
b. VAT-Exemptsupplierfromcustomsterritorytoa PEZA registeredenterprise-exemptfromVAT
c. PEZA registeredenterprise- technical importation,imposedwithcorrespondingVAT
d. Sale of Servicesbya PEZA registeredenterprisetoa buyerfromthe customsterritory- 12% VAT
e. Sale of Goods bya PEZA registeredenterprisetoanotherPEZA registeredenterprise-exempt
fromVAT
In the course of trade or business- regularconductor pursuitof a commercial orany economic
activityincludingtransactionsincidentalthereto
- Non-residentswhoperformserviceinRPdeemedmakingsalesinthe course of trade or
business
17. - Membershipfeesandassociationduescollectedbyclubs,condominiumcorporations
(subjecttoVAT)
Exceptif:
1. Gross annual salesand/orreceiptsdonotexceedP1,919,500
2. Taxpayerisnot a VAT- registeredperson
-taxpayershouldby3%tax equivalentof hisgrossmonthlysales/receipts
-marginal income earners- notsubjecttobusinesstaxesbecause theyare not consideredas
engagedintrade or business
-notexceedingP100,000 grosssalesor receiptsperyear
IMPORTERS SHOULD PAY VAT
VATON SALE OFGOODS OR PROPERTIES(12% VAT)
Goodsor Properties
1. Real properties
2. Patentcopyrightet.al.
3. Rightto use RP of any industrial,commercial,orscientificequipment
4. Rightor privilege touse motionpicture films,filmtapes/discs
5. Radio,tv,satellite transmissionandcable tvtime
Requisites
1. Actual or deemedsale
2. In the course of trade or business
3. RP consumption
4. NotexemptfromVAT
GSP
1. If real property- salesdocumentorFMV
a. CIR zonal value
b. Assessorreal propertytax declaration
2. Sale of residential lot>P1,919,500
3. House and lot/otherresidential dwelling>P3,199,200
4. Lease of residential until >P12,800/mo or P1,919,500/year
Exclusive of VATandalsoif not billedseparately,exclusiveof VATaswell
Not taxable
1. Notprimarilyforsale
2. Low cost or socializedhousing
3. Residential lot<P1,919,500
4. House and lot/dwelling<P3,199,200
5. Lease < P12,800/mo or P1,919,500 peryear
6. Transmissionof atrustee
18. 7. Transferto corporationinexchange of stocks
8. Advance paymentbylessee
9. Securitydepositsforlease agreements
1. Installmentplan-initial paymentsbefore executionof sale,includingdownpayments,etc
- Do not exceed25%of GSP
- Taxable onlyorpaymentactuallyorconstructivelyreceived
2. DeferredPayment-initial paymentsexceeds25% of GSP
-treatedascash sale and the entire sellingprice istaxable onthe monthof sale
Zero-ratedgoods
a. A zero-ratedsale byaVAT-registeredpersonisataxable transactionsforVATpurposes,butshall
not resultinanyoutputtax
b. However,inputtax onpurchasesof goods,propertiesorservicesrelatedtosuchzero-ratedshall be
available astax creditor refund
Export sales
a. Sale and actual shipmentof goodsfromRP toother country
b. Sale of raw materialsorpackagingmaterialstoa nonresidentbuyerfordeliverytoa resident
local exportorientedenterprise
c. Sale of raw material/packagingmaterialswhose exportsalesexceed70% of annual production
d. Sale of goldto BSP
e. Those consideredexportsalesunderthe OmnibusInvestmentCode of 1987
Constructive Exports
1. Salestobondedmanufacturingwarehousesof export-orientedmanufacturing
2. Salestoexportprocessingzones
3. Sale to registeredexporttraders
4. Sale to diplomaticmissionandotheragencies
5. Sale of goods,suppliesequipmentfuels- anotherexportsale
ForeignCurrency DenominatedSales(FCDS)
1. Sale to a nonresidentof goods,exceptthose mentionedinSections149 and150 for deliverytoa
residentin the Philippinespaidinacceptance foreigncurrencyandaccountedforinaccordance
withthe rulesandregulationsof the BSP
2. Salesof locallymanufacturedorassembledgoodsforhouseholdandpersonal use toFilipino
abroad andother non-residentof RP
19. Transactions deemedsale=12% VAT, fair market value and acquisitioncost (applicable inSan Roque
vs CIR)
1. Consignmentof goodsif actual sale notmade within60 days- not deemedsold
2. Distributionortransfertoshareholders,investors,orcreditors
3. transfer,use or consumptionnotinthe course of businessof goods/propertiesoriginallyintendedfor
sale or use inthe course of business
4. Retirementorcessationof personorbusiness=12%
Exempt:
1. Change or control of a corporation
2. Merger or consolidation
3. Change inthe trade or corporate name
Gross receipts- total amountof moneyoritsequivalentrepresentingthe contractprice,compensation,
service fee et.al.actuallyorconstructivelyreceived
Constructive receipts- moneyconsiderationoritsequivalentisplacedatthe control of the personwho
renderedservice withoutrestrictionsbythe payor
- Depositsinbanks,issuance bydebtorof notice toaccept,transferof amountsretainedby
contractee to account of the contractor
Requisitesfora taxability
1. Performedinthe course of trade or businessinRP
2. Valuable considerationactuallyorconstructivelyreceived
3. Service isnotexemptunderTax Code,special law orinternational agreement
4. Personsellingorrenderingservice isliabletoVAT
Meaningof sale/exchangeof services
1. Contractors
2. lessors
3. brokers
4. warehousingservices
5. cinematographicfilms
6. milling,processing,manufacturing
7. movie houses
8. eatingplaces
9. dealersinsecurities
10. lending
11. transportation
12. commoncarriers
13. electricity
14. franchise grantees
15. non-lifeinsurance
20. 16. others
17. copyrightet.al.
Zero-ratedsale ofservices
1. VATable
2. But no outputtax
3. Inputtax fortax creditor refund
4. For otherpersonsdoingbusinessoutsideRP
5. Personengagedinbusinessconductedoutside the RPora nonresident personnotengagedin
RP
6. Exemptionunderspecial lawsorinternational agreements
7. Subcontractorsand/orcontractors
8. Transport of passengerandcargo
9. Sale of poweror fuel generatedthroughrenewable sourcesof energy
VATexempt(see previouspagesfornot taxable)
1. Agricultural
2. Fertilizers
3. Percentage tax services
4. Medical,dental,hospital
5. Employer-employee
6. International agreement
7. Agri coop
8. Educational
9. CDA
10. Non-agri CDA
11. Low cost housing
12. Social housing
13. > P1,919,500 or P3,199,200
Inputtax- VATdue on or paid by a VAT-registeredpersonorimportationof goodsorlocal purchases
of goods,propertiesorservicesincludinglease oruse of propertyincourse of his trade or business
21. Sourcesof inputtax:
a. Transitional inputtax-2%of value of beginninginventoryonhandor actual VATpaid onsuch
goods,material andsupplywhicheverishigher
b. Purchase or importationof goods
1. for sale
2. for conversionintoorintendedtoformpartof a finishedproductforsale,includingpackaging
materials
3. suppliedinthe course of business
4. use of raw materialssuppliedinthe sale of servicesor
5. use intrade or businessforwhichdeductionfordepreciationoramortizationisallowedunder
the Tax Code
c. Purchase of real propertiesforwhichVAThasactuallybeen paid
d. Transactionsdeemedsale
e.Presumptive Inputtax
- 4% of grossvalue inmoneyof theirpurchasesof primaryagricultural productswhichare
usedas inputto theirproduction
- Engagedinprocessingof sardines,mackerel andmilk,refinedsugar,cookingoil,packed
noodle-basedinstantmeals
f.Transitional inputtax creditsallowedunderthe transitoryandotherprovisionsof these Regulations
g. Creditable WithholdingVATonpaymentstonon-residents
h. Purchasesof servicesinwhichaVAThas beenactuallypaid
Taxpayer Time to claim inputtax
Importer Upon paymentof VATpriorto the release of
goodsfrom customscustody
Purchaserof domesticgoodsor properties Upon consummationof sale
Purchaserof servicesorthe lessee orlicensee Upon paymentof the compensation,rental,
royaltyor fee
To the purchaserof real propertyunder:
Cash/Deferredpaymentbasis
Installmentbasis
Upon consummationof sale
Upon everyinstallmentpayment
Outputtax- VATdue on sale or lease of taxable goodsorpropertiesorservicesbyanypersonregistered
or requiredtoregisterunderSec236 of Code.
Creditable againstoutputtax
22. Tax Remedies
Assessment(self,deficiencyandjeopardy)
- Computationof tax liabilitiesanddemandforpaymentwithinthe prescriptiveperiod
- Law and factson whichthe assessmentismade;otherwise,the assessmentshall be void
Constructive receipt- if creditedorsegregatedinfavorof a person.
Constructive methodsof income determination
1. percentage method
2. net worth method
3. bank depositmethod
4. cash expendituremethod
5. unitand value method
6. 3rd
party informationoraccessto recordsmethod
7. surveillance andassessmentmethod
Tax deficiency- amountbywhichtax imposedexceedsthe amountshownasthe tax by the taxpayer
uponhisreturn
Tax delinquent-self-assessedtax perreturnfiledbythe taxpayeronthe prescribeddate wasnotpaidat
all or onlypartiallypaidordeficiencytax assessedbythe BIRbecame final andexecutory.
Powersof CIR
1. Examination of returnsanddeterminationof tax due
2. Use of bestevidence obtainable
3. Authoritytoconduct inventory-taking,surveillance,andtoprescribe additional procedural or
documentaryrequirementsandpresumptive grosssalesandreceipts
4. terminate taxable period
5. real estate values
6. inquire intobankdeposits
7. accredit andregistertax agents
Periodof assessmentandcollection
General rule:3 yearsfromlast dayof filingof return
1. If return filedbefore lastday- 3yearscountedfromlastday of filing
2. If return filedafterthe lastday- 3 yrs countedfromlastday of actual (late) filing
23. Exceptions- 10yearsfrom date of discoveryof:
a. Non-filingof return
b. Filingof false or
c. Filingof fraudulentreturnwithintenttoevade tax
April 15- count of 3 yrs
Periodof collection
1. 5 yrs fromassessment
2. 10 yrs withoutassessment,incase of false orfraudulentreturnwithintenttoevade tax or
failure tofile return
BIR 2 options
1. Assesscorrecttax liabilitywithin10yrs fromdiscoveryandcollectonsaidassessmentwithin5
yrs fromassessment
2. File aproceedingincourtfor collectionwithin10yearsfrom date of discoveryof falsity,
fraudulentoromissionwithoutassessment
Fraud
1. Questionof factthat cannot be presumedbutmustbe sufficientlyestablished
2. Understatementnottantamounttofraud;shouldbe at least30% underdeclarationof income
prove intentionandsubstantial understatementof tax liability
3. Fictitiousexpenses
4. Allegedandprovedincourt
5. Actual and notconstructive,wrongdoingwith sole objectof avoidingtax
Suspension
3 years- notfixed
-extendedorsuspended
-If TP and BIR execute waiver
- CIR prohibitedfromcollectingonthe tax,suchas whenTP appealsthe decisionof the CIRondisputed
assessmentonCTA
-TP requestsforreinvestigationgrantedbyCIR
-TP cannotbe located
-warrantof distraintorlevyisdulyservedandnopropertycouldbe located
-TP isout of the Phil.
-Taxpayer’sremedies- administrativeprotest,refund,CTA appeal
24. RMO 12-99
1. Filingof return
2. LOA
3. Informal conferece
4. PAN
5. FAN
6. Administrative protest
7. Final decision
8. Appeal toCIR
9. Judicial appeal
NewRule
1. PAN
2. FLD/FAN within3yr period
3. Administrative protest
4. FDDA
5. Appeal
6. Judicial
15 days to respondfromreceipt
PAN not required(MDECP)
1. Mathematical error
2. Discrepancybetweentax withheldandaccountactuallyremitted
3. Excise tax not paid
4. Taxpayerwhooptedto claimrefundortax creditof excessCWTcarried overthe amount
5. Article locallypurchasedorimportedbyanexemptpersonhasbeensoldortradedtonon-
exemptpersons
Claimfor excessand unutilizedcreditable withholdingtax
1. Within2 yr
2. Copiesof the certificate of tax withheld
3. Part of gross income of taxpayer
4. Excessand unutilizedCWTnotcarriedover
FAN
1. In writing
2. Name,address,TIN,basictax, period,penalties,date tax mustbe paid
3. Facts, laws,rules,regulationsorjurisprudence
4. Personal deliveryorregisteredmail
5. SignedbyCIR or authorizedrepresentative
6. CoveredbyLOA
25. Administrative Protest
1. Within30 days
2. Reconsideration
3. Re-evaluation
4. Reinvestigation- withnewevidence andwithin60days
5. Appeal toCommissionCTA within30days
6. Judicial appeal- 30daysor 30 daysfrom last180
GovernmentTaxation Remedies- tax beingfinal
A. Administrative
1. Tax Lien
-legal claimorcharge onpropertyinfavor of government
- notvalidagainstany mortgagee,purchaserorjudgmentcreditor
-governmentliensuperiortomortgage ingoodfaithgenerally
2. Actual distraint- enforcedongoods,chattels,effectsotherthanpersonal property
3. Constructive distraint
-retiringanybusinesssubjecttotax
-intendingtoleave Philippines
-removinghisproperty
-intendingtoperformtoobstructproceeding
4. Levyof real property- seizure
5. Forfeiture togovernment- nobidder/insufficientbidtopaytaxes,penaltiesandcosts
6. An injunctionnotavailable torestraincollectionof tax- CIRdecisionasanexception
B. Judicial/Civil & Criminal
1. Approvedof CIRincase of fraudand filingof tax evasion
2. Can file criminal case immediately
3. 25% surcharge- failure tofile anyreturnlate payment
4. 50% surcharge- willful neglecttofile andreturn/filingfraud
Compromise- reasonabledoubttothe validityof the claimagainstthe TPexistsandfinancial positionof
TP demonstratesclearinabilitytopaythe assessedtax;CIRdiscretionarypowertocompromise court
cannot interfere
Abatement- tax oranyportionthereof appearstobe unjustlyorexcessivelyassessedandadministrative
and collectioncostsinvolveddoesnotjustifythe collectionof the amountdue
Cannotbe compromised:
1. Withholdingtax cases
2. Criminal tax fraudcasesconfirmedassuch bythe CIR/dulyauthorizedrepresentative
3. Criminal violationalreadyfiledincourt
4. Delinquentaccountswithdulyapprovedschedule of installmentpayments
5. Caseswhere final reportof reinvestigationorreconsiderationhave beenissuedresultingto
reductioninthe original assessmentandTPisagreeable tosuchdecisionbysigningthe required
agreementform
6. Caseswhichbecome final andexecutorafterfinaljudgmentof courtwhere compromise is
requestedonbasisof doubtful validity
7. Estate tax caseswhere compromise isrequestedonthe groundof financial incapacityof the TP.
26. Local GovernmentTaxation
Fundamental Principles(UEPIP)
1. Uniform
2. Equitable forpublicpurpose,notunjustandnotcontraryto law
3. Inure to benefitof local governmentunit
4. Shall notbe letanyprivate person
5. Progressive
Nature and Source of Taxing Power-EachLGU can:
1. Create itsownsourcesof revenue pursuanttoordinance
2. Levy,taxes,feesandcharges
3. Accrue solely/exclusivelytothe LGU
4. Can alsogrant tax exemptions,incentiveorreliefs
Penalties
1. Surcharge not exceeding25%of amountof taxes,feesorchargesnot paidon time
2. Interestnotexceeding2%permonthof the unpaidtaxes,feesorcharges,until suchamountis
fullypaidbutinno case shall the total interestonthe unpaidamountor portionthereof exceed
36 months
Exemptionsare withdrawnunlessotherwise provided
Adjustlocal tax rates- LGU can adjustrates notoftenerthan1 every5 years
- Notexceed10%
Scope ofTaxing Power
Provinces
1. Transferof real propertyownership
2. Businessof printingandpublication
3. Franchise tax
4. Tax on sand,gravel andotherquarry resources
5. Professionaltax
6. Amusementtax
7. Annual fixedtax foreverydeliverytruckorvan
Municipalities- ceilingis50%
1. Business-basedongrossreceiptsnotgrossrevenueanddoesnotinclude condominiums
2. Licensing/regulationof businessandoccupation
3. Sealingandlicensingof weightsandmeasures
4. Fisheryrentals,feesandcharges
5. Communitytax
6. Real PropertyTax (RPT) withinMetroManila
27. Cities
1. Same withprovincesandmunicipalities
2. Leviedandcollectedbyhighlyurbanizedandindependentcomponentcitiesshall accrue to
themand distributedinaccordance withthe provisionsof LGC
3. Rateson levymade bythe Citymay exceedthe maximumratesallowedforthe province or
municipalitybynotmore than 50%
Exceptions- rates of professional and amusement taxes
Barangays
1. Taxeson storesor retailers
2. Service feesorcharges
3. Barangay clearance
4. Otherfeesandcharges
Communitytax – citiesor municipalitiesmaylevyto
Individuals
1. Inhabitantsof the Philippine
2. 18 y.o.or over
3. Regularlyemployedorsalarybasis
4. Businessoroccupation
5. Ownsreal propertywithan aggregate assessedvalueof P1Kor more
6. Requiredbylawtofile anincome tax return
Juridical
1. Everycorporationno matterhow createdor organized
2. Whetherdomesticorresidentforeign
3. Engagedinor doingbusinessinthe Philippines
PersonsExempt
1. Diplomaticandconsularrepresentatives
2. Transientvisitorswhostayinthe Philippinesfornotmore than3 months
Place where individualresideswhere principal office islocated
Accrue on 1st
Januaryof each yearto be paidnotlater thanFebruary
24% interestif unpaid
28. Common limitationsonthe taxing powersof LGUs (IDEC-GAPEP-GRR-ECN)
1. Income tax exceptwhenleviedonbanksandfinancial institutions
2. Documentarystamptax
3. Estate tax
4. Customsduties,exceptwharfage onwharvesconstructedandmaintainedbythe LGU
concerned
5. Goodscarried intoor out of,or passingthrough,the territorial jurisdictionsof local government
unitsinthe guise of charges forwharfage,tollsforbridgesorotherwise,orothertaxes,feesor
otherwise
6. Agricultural andaquaticproductswhensoldby marginal farmersandfishermen
7. Pioneerornon-pioneerbusinessenterprisesfor6and 4 yearsrespectivelyfromdatesof
registrationandcertifiedbyBoardof Investments
8. Excise taxesorarticlesenumeratedunderNIRCasamended,taxes,feesandchargeson
petroleumproducts
9. Percentage orVATon sales,bartersorexchangesorsimilartransactionsongoodsor services
exceptasotherwise providedherein.
10. Gross receiptsof transportationcontractorsandpersonsengagedinthe transportationof
passengersorfreightbyhire andcommoncarriers byair, landor water,exceptasprovidedin
the Code
11. Taxeson premiumspaidbywayor reinsurance orretrocession
12. Motor vehicle registrationexcepttricycles
13. Philippine productexported
14. Cooperatives
15. National Government
Remedies
TaxpayersRemedies
1. Assessmentwithin5yearsfromdate theybecome due
2. In case of fraud- 10 yearsfromdiscoveryof fraudor intenttoevade payment
3. Collection:5yrsfrom the date of assessmentbyadministrative orjudicial action
Prescriptionperiodsuspended
1. Treasurer- legallyprevented
2. Reinvestigation
3. Out of the country or cannot be located
Protest- within60days fromreceiptof Notice of Assessment
Claimsfor refund oftax creditfor erroneouslyorillegallycollectedtax,fee or charge
1. Writtenclaim
2. Within2 years
29. Civil RemediesbyLGU
1. Non-paymentof atax,fee orcharge createsa liensuperiortoall liensorencumberancesin
favorof any otherperson,enforceablebyadministrativeorjudicial action
2. Lienmay onlybe extinguishedupon full paymentof the delinquentlocal taxes,feesandcharges
includingrelatedsurchargesandinterests
Criminal Remedies
1. Administrative Action
2. Judicial Action
Distraint of personal property
1. Seizure of personal property
2. Accountingof distrainedgoods
3. Publicationof time andplace of sale andarticles
4. Release of distrainedpropertyuponpaymentpriortosale
5. Procedure of sale
6. Dispositionof proceeds
Levy of real property
1. Dulyauthenticatedcertificate
2. Writtennotice of levy
3. Connotationof levy
4. Advertisementandsale
Exceptions(TOB-CUPLA)
1. Toolsand implementsnecessaryfortrade oremployment
2. One horse,cow,carabao or otherbeast
3. Clothingandthat of hisfamily
4. Furniture andfixturesandutensilsusedinhouseholdnotexceedingP10000
5. Provisions,includingcropssufficientfor4 months
6. Librariesof doctors,engineers,one fishingboatandnetnotexceedingP10000
7. Anymaterial orarticle for house orimprovementof anyreal property
Judicial Action
1. Local governmentmayinstitutionorordinarycivil action withregularcourtsof proper
jurisdictionforthe collectionof delinquenttaxes,fees,chargesorotherrevenues
2. The civil actionshall be filedbythe local treasurer.
30. Real Property Taxation
Principles(CAPUE)
1. Currentfairmarketvalue basisfor assessment
2. Actual use
3. Private personcannotbe lefttoappraisal,assessment,levyandcollectionof real propertytax
4. Uniformclassificationwithineachlocal governmentunit
5. Equitable appraisal andassessment
Nature (DAPSA)
1. Directtax
2. Ad valoremtax
3. Proportionate
4. Single/indivisibleobligation
5. Attachesonthe property
6. Leviedthrough/thruadelegatedpower
Coverage
1. Land
2. Building
3. Machinery
4. Otherimprovements
If province 1% of assessedvalue of real property,cityormunicipalitywithinMetroManila- 2% of real
property
If idle lands- 5%of assessedvalue of property+basictax
Coveredidle lands
Agricultural lands- more than1 ha suitable forcultivation,dairying,inland,fisheryandotheragricultural
usesone-half ½of whichremainunutilizedorunimproved.
Otherthan agricultural- more than1000 sqm inarea ½ of whichunutilized/unimproved
Exempt idle lands
1. Force majeure
2. Civil disturbance
3. Natural calamity
4. Or any cause or circumstance whichphysicallyorlegallypreventsimproving,utilizingor
cultivatingthe same
31. Special levyfor public works
- Withreasonable accuracythe nature,extentandlocationof the publicworkstobe
undertaken,the estimatedcosts,the metesandboundsbymonumentsandlinesandthe
numberof annual installmentswhichshouldnotbe lessthan5 nor more than 10 years
- Sanggunianmayfix differentratesfordifferentpartsorsectionsthereof,dependingon
whethersuchlandismore or lessbenefitedbythe proposedwork
Special Education Fund (SEF)
- Province,orcityof municipalitywithinMetroManilamaylevyandcollectan actual tax of
one percentonthe accessedvalue of real propertywhichshall be inadditiontothe basic
real propertytax
Exemptionfrom real propertytax (RPT)- RCWCE
1. Ownedby Republicof the Philippines
2. Charitable institutions,churchesetal actually,directlyorexclusivelyusedforreligious,
charitable oreducational purposes
3. Local waterutilities- actually,directlyandexclusivelymachineriesandequipment
4. Cooperatives- real propertyownedbyCooperative
5. Machineryand equipmentusedforpollutioncontrol andenvironmental protection
Proof of Exemption(DA30T)
1. Documentaryevidence
2. Give to local assessor
3. Within30 daysfromdate of declaration
4. Failure tofile will be listedastaxable
GOCC- not coveredbyexemptionsince exemptiononlyreferstoinstrumentalitieswithout
personalitiesdistinctfromthe government(MIAA andPPA cases)
Lung CentervsQC- charitable institution/hospital use foritspatients,payingornon-paying,are
exempt
-propertyleasedtoprivate entitiesare notexemptbecauseitisnotactually,directlyandexclusively
usedforcharitable purposes
32. Administrationof Real PropertyTax
1. Declarationof real propertybyowneror administrator
-sworn statement
-sufficientdescription
-1 every3 years- January1 to June 30
2. Declarationbyanypersonacquiringreal propertyormakingimprovement
-swornstatementof true value of property
-toprovincial,cityandmunicipal assessorwithin60daysafter acquisitionorimprovement
3. Declarationbythe provincial orcityor municipal assessor
4. Notice of transferwithin60 days;includesmode of transfer,descriptionof the property
alienatedandname andaddressof the transferee
5. Listingof Real Propertyinthe AssessmentRolls
a. Real Property- name of owner,administratororanyone havinginterestinthe property;
same withcorporation,partnershiporassociation
b. Undividedreal property-estate,heirs,deviseesorone/more co-ownersandsame with
corporation, partnershiporassociation
c. Real propertyownedbyRP,instrumentalities,political subdivision,beneficial use has been
grantedto a taxable person.Inthe name of the possessor,grantee orthe publicentityif
such propertyhasbeenacquiredorheldfor resale orlease
Classesof Real Property
1. Residential
2. Agricultural
3. Commercial
4. Industrial
5. Mineral
6. Timberland
7. Special- all lands,buildingsandotherimprovementsactually,directlyandexclusively
usedforhospital,cultural orscientificpurposes,andthose ownedandusedbylocal
waterdistrictsandGOCCs renderingessentialpublicservicesinthe supplyand
distributionof waterand/orgenerationandtransmissionof electricpower
33. Machinery- FMV is acquisitioncost
- If imported- includesfreight,insurance,bankandothercharges,brokerage,arrastre ad
handling,dutiesandtaxes,pluscostof inlandtranspo,handlingandinstallationchargesat
the presentsite
- Estimatedeconomiclife*replacementorreproductioncost
- Depreciation=5%of original costor replacementcostperyear
- Remainingvalue fixedatnotlessthan20% of suchoriginal,replacementorreproduction
costs as longas useful andinoperation
Assessmentlevel-FMV taxable value of property,ordinance, every3yearsandevery1 January
except:
1. Partial or total deduction
2. Major change in actual use
3. Great and suddeninflationordeflationorreal propertyvalues
4. Gross illegalityof the assessmentwhenmade
5. Anyotherabnormal cause shall be made within90 days fromthe date of any cause and shall
take effectatthe beginningof the quarternextff.the reassessment
- Subjecttoback taxes=10 yrs prior
- Notification- within30days
Collection
1. 1 Januaryaccrual
2. Notice 1 wk for2 consecutive weeksbylocal treasureronorbefore 31 January
3. Local treasurer=collectingauthority
Prescription:
a. Within5 yearsfrom date theybecome due
b. Within10 yearsfromdiscoveryof fraud
Suspensionof Prescriptive Period
1. Legallyprevented
2. Reinvestigation
3. Out of country or cannot be located
Unpaidreal propertytax interest=2%permonth
Condonation- Sanggunian,Presidentof the Philippines
RemediesofLGUfor RPT Collection
1. Lien
2. Levy
3. Judicial 5-10 yearsby local treasurer
34. Purchase byLGU forwardof bidder
1. Local treasurer- within2yrs
2. Redemption- within1yr fromdate of forfeiture
Redemptionoftaxpayer
1. Protest- administrative
2. Judicial- 30/60 days