Estate planning in the Philippines is primarily governed by the Civil Code of the Philippines (Republic Act No. 386), specifically under the Law on Succession. Succession is a mode of acquisition by virtue of which the property, rights, and obligations to the extent of the value of the inheritance of a person are transmitted through his death to another or others either by his will or by operation of law.

I. Systems of Succession

Succession in the Philippines is classified into three categories:

Testamentary (Testate): Results from the designation of an heir, made in a will executed in the form prescribed by law.
Legal or Intestate: Takes place by operation of law when there is no valid will, or when the will is void or has lost its validity.
Mixed: Effected partly by will and partly by operation of law.

II. The Concept of Legitimes

The most distinct feature of Philippine succession law is the Legitime. This is the part of the testator's property which he cannot dispose of because the law has reserved it for certain heirs, known as Compulsory Heirs.

Compulsory Heirs

Compulsory heirs are classified into:

Primary: Legitimate children and their legitimate descendants.
Secondary: Legitimate parents and legitimate ascendants (they only inherit in the absence of legitimate children).
Concurring: The surviving spouse and illegitimate children (they inherit alongside either primary or secondary heirs).

Common Shares of Legitime

The proportions vary depending on the combination of heirs. For example:

Legitimate Children: 1/2 of the estate.
Surviving Spouse: Usually gets a share equal to that of one legitimate child.
Free Portion: The remainder of the estate after all legitimes are satisfied, which the testator may freely bequeath to anyone through a will.

III. Wills: Form and Requirements

A will is a personal, solemn, revocable, and free act by which a person disposes of his property to take effect after death. To be valid in the Philippines, a will must comply with strict formal requirements.

Types of Wills

Notarial Will:

Must be in writing and executed in a language or dialect known to the testator.
Signed at the end by the testator or by someone else in his presence and by his express direction.
Attested and subscribed by three or more credible witnesses in the presence of the testator and of one another.
Each and every page must be signed by the testator and the witnesses on the left margin.
All pages must be numbered correlatively in letters.
Must contain an Attestation Clause.
Must be acknowledged before a Notary Public.

Holographic Will:

Must be entirely written, dated, and signed by the hand of the testator himself.
It is subject to no other form, may be made in or out of the Philippines, and need not be witnessed or notarized.
Any insertion, cancellation, erasure, or alteration must be authenticated by the full signature of the testator.

IV. Capacity to Make a Will

To execute a valid will, the testator must meet two primary criteria:

Age: Must be at least 18 years old.
Soundness of Mind: The testator must know the nature of the estate to be disposed of, the proper objects of his bounty, and the character of the testamentary act.

V. Disinheritance

A testator can deprive a compulsory heir of their legitime only for causes expressly specified by law. For a disinheritance to be valid, it must:

Be made in a valid will.
Specify the legal cause (e.g., attempt on the life of the testator, maltreatment, or leading a dishonorable life).
Be unconditional and total.
The cause must be true; if the disinherited heir denies the cause, the burden of proof rests upon the other heirs.

VI. Intestate Succession (Succession Without a Will)

When a person dies without a will, the law determines who the heirs are based on the proximity of relationship. The order of intestate succession is generally:

Legitimate Children/Descendants.
Legitimate Parents/Ascendants.
Illegitimate Children.
Surviving Spouse.
Brothers and Sisters, Nephews and Nieces.
Other Collateral Relatives (up to the 5th degree).
The State (Escheat).

VII. Probate of a Will

No will shall pass either real or personal property unless it is proved and allowed in accordance with the Rules of Court. Probate is the legal process of proving that a will is valid and was executed according to the formalities of law.

Ante-mortem Probate: The testator may petition the court for the allowance of his will during his lifetime.
Post-mortem Probate: Petitioned after the death of the testator.

VIII. Taxation: The Estate Tax

Under the TRAIN Law (Republic Act No. 10963), the estate tax in the Philippines is a flat rate of 6% based on the value of the net estate.

Key Deductions Include:

Standard Deduction: PHP 5,000,000.
Family Home: Up to PHP 10,000,000.
Claims against the estate.
Amounts received under RA 4917 (Retirement benefits).

The Estate Tax Return must be filed within one year from the decedent's death.

IX. Summary of Settlement of Estate

Judicial Settlement: Involves court proceedings, necessary if there is a will or if the heirs cannot agree on the partition.
Extrajudicial Settlement: Allowed if the decedent left no will and no debts. All heirs must agree and execute a public instrument (Deed of Extrajudicial Settlement) to be filed with the Register of Deeds and published in a newspaper of general circulation.