1) Overview: What “estate tax” is and why the process matters

Estate tax is a tax on the transfer of the decedent’s property (the “estate”) to heirs or beneficiaries. In the Philippines, payment of estate tax is a practical gatekeeper: without proof of filing and payment (or a recognized exemption), you generally cannot lawfully transfer titles of real property, release certain bank deposits, or effect changes in corporate stock ownership in the name of heirs. The process is document-heavy, deadline-sensitive, and therefore frequently targeted by scammers, “fixers,” and fake “assessment” schemes.

This article focuses on:

How estate tax is computed and paid (administrative process, documents, payment channels, post-payment clearances).
How legitimate assessments and computations are issued and how to verify them.
Common scam patterns and concrete verification steps.

2) Governing law and key concepts (Philippine context)

Estate taxation is primarily governed by the National Internal Revenue Code (NIRC), as amended, and administered by the Bureau of Internal Revenue (BIR). Other agencies become involved after payment (e.g., Register of Deeds, local assessors, banks, corporations).

Core terms

Decedent: the person who died.
Estate: all property, rights, and interests of the decedent at death, minus allowable deductions.
Executor/Administrator: person responsible in a testate estate (will) or judicial settlement; in practice, heirs often sign and process for extrajudicial settlement, but liability rules still apply.
Heirs/Beneficiaries: persons who succeed to the estate.
RDO (Revenue District Office): local BIR office that has jurisdiction (generally tied to the decedent’s domicile at death).
Estate Tax Return: BIR form where the estate is declared and tax computed (commonly BIR Form 1801).
eCAR / CAR: electronic Certificate Authorizing Registration / Certificate Authorizing Registration—BIR clearance needed for transfers of property.

3) Who must file and pay, and where to file

Who is responsible

As a rule, the executor/administrator files and pays; if none, the heirs (or authorized representative) will file. Liability can extend to those who control estate property or cause transfers without compliance.

Where to file

Typically, the estate tax return is filed with the BIR RDO that has jurisdiction over the decedent’s domicile/residence at the time of death. Special rules apply when the decedent was a non-resident or when the estate has property in multiple locations; the BIR’s jurisdiction rule controls the filing venue.

Anti-scam point: Jurisdiction is a common pressure tactic used by scammers (“Your papers are in another RDO; pay me to ‘transfer’ your docket”). Always confirm the correct RDO directly through official BIR channels or at the RDO help desk.

4) Deadlines, extensions, and penalties (practical implications)

Filing deadline

Estate tax returns are generally due within a fixed period counted from the date of death. Extensions can exist in limited circumstances, typically requiring formal application.

Payment extensions

The law allows the BIR, under certain conditions (often where payment would cause undue hardship), to grant an extension to pay subject to conditions and possible security. These are not automatic and are not arranged through private intermediaries demanding cash.

Penalties for late filing/payment

Late compliance can trigger:

Surcharges (often 25% for ordinary late filing; higher in more serious cases),
Interest computed per annum on unpaid tax,
Compromise penalties in certain situations.

Anti-scam point: Penalties have formulas. A scam “assessment” often uses vague round numbers, inconsistent rates, or threatens arrest unless paid immediately.

5) What is taxed: gross estate, situs, and valuation

5.1 Scope (who is taxed on what)

Citizens and resident aliens: generally taxed on worldwide estate (subject to rules).
Non-resident aliens: generally taxed only on Philippine-situs property (e.g., real property in the Philippines, shares in domestic corporations, certain intangibles).

5.2 Typical assets included

Real property (land, buildings, condominiums).
Bank deposits, cash, receivables.
Shares of stock (listed/unlisted), partnership interests.
Vehicles, jewelry, other personal property.
Certain transfers made in contemplation of death or with retained interests (depending on facts).

5.3 Valuation standards that commonly control computations

Valuation is a major friction point and a major scam vector.

Real property

BIR practice commonly compares values such as:
- Zonal value (BIR-published for an area),
- Fair market value per tax declaration (local assessor),
- Potentially other indicators depending on circumstances.

Transfers typically use the higher of prescribed benchmarks, depending on the applicable rule in force and the document set.

Shares of stock

Listed shares: commonly based on market quotations at relevant dates.
Unlisted shares: commonly based on book value or audited financial statements, subject to BIR rules.

Bank deposits

Based on bank certifications of balances as of date of death (and related details).

Anti-scam point: A legitimate BIR computation should cite the basis (zonal value schedule, tax declarations, bank certificates, financial statements) and show math. Scams rarely provide source documents.

6) Deductions and exemptions: what can reduce the tax

Allowable deductions depend on the law in force and the estate’s facts. Common categories include:

Standard deduction (fixed amount, if applicable).
Family home deduction (up to a ceiling, subject to conditions and proof).
Funeral expenses (often capped; must be supported).
Medical expenses incurred within a prescribed period before death (often capped; must be supported).
Claims against the estate (debts) and claims against insolvent persons, if properly substantiated.
Taxes and certain losses, in limited cases.
Property previously taxed (subject to conditions).
Transfers to the Government and in some cases to qualified entities, depending on rules.

Anti-scam point: “Fixers” often promise inflated deductions without documents. Overclaiming deductions increases audit risk and can generate real deficiency assessments later.

7) Step-by-step: the lawful estate tax payment process (end-to-end)

Step 1: Determine the settlement route and collect core civil documents

Common settlement modes:

Extrajudicial settlement (when there is no will and heirs agree; often with publication requirements depending on facts).
Judicial settlement (court proceedings; common when there are disputes, minors, complex assets, or a will).

Core documents commonly required:

PSA Death Certificate.
PSA Marriage Certificate (if relevant), PSA Birth Certificates of heirs.
Valid IDs and TINs of heirs/authorized signatories (or application for TIN if needed under BIR rules).
Proof of decedent’s last residence/domicile.

Step 2: Inventory all assets and liabilities, and secure third-party certifications

Examples:

Certified true copies of titles (TCT/CCT) and tax declarations.
Certificate of No Improvement or related assessor certifications where relevant.
Bank certification of deposit balances as of date of death (and details of interest).
For shares: stock certificates, secretary’s certificate, latest AFS for unlisted shares, broker statements for listed shares.
Vehicle: OR/CR, LTO records if needed.
Debts: notarized loan documents, statements of account, proof of unpaid balances.

Step 3: Prepare the estate tax return and attachments

Typically:

Complete the estate tax return (commonly BIR Form 1801) and schedules.
Prepare supporting annexes (asset schedules, valuation worksheets, deductions).
Prepare settlement documents (e.g., deed of extrajudicial settlement, partition, waiver, etc.), notarized and compliant with publication/notice requirements when applicable.

Anti-scam point: A “computed amount” sent by chat or text without a complete return and schedules is not a legitimate basis for payment.

Step 4: File with the correct RDO and obtain docketing/receiving proof

Submit the return and attachments for evaluation/verification by the RDO.
Secure received stamps, docket numbers, or official receiving evidence per the RDO’s process.

Anti-scam point: Never accept “we filed it already” without a clear receiving proof that can be verified at the RDO.

Step 5: Pay through authorized channels only

Payment is typically made via:

Authorized Agent Banks (AABs) for the RDO, if applicable,
Or the RDO’s Revenue Collection Officer (RCO) where no AAB is designated or for certain transactions,
Or officially recognized electronic payment channels where allowed (subject to BIR rules and availability).

Non-negotiables for legitimacy

Payment must generate official proof: machine-validated return/payment slip, bank validation, official receipt, and/or official electronic confirmation traceable to BIR.
The payor details and tax type must match the estate tax filing.

Anti-scam red flags

Requests to pay via personal bank accounts, e-wallets, remittance centers, or “courier cash pick-up.”
“Discounts” offered for paying in cash.
“Split payments” to multiple individuals.

Step 6: Secure the BIR clearance for transfer (eCAR/CAR)

After validation of filing and payment and completion of BIR evaluation, the RDO issues eCAR/CAR for specific properties. You typically need eCAR/CAR for:

Transfer of real property at the Register of Deeds,
Transfer of shares in many cases (corporate transfer books),
Other transactions requiring proof of tax compliance.

Anti-scam point: Fake eCARs circulate. Treat eCAR as a high-value document—verify issuance through the RDO and cross-check acceptance with the Register of Deeds/corporation before relying on it.

Step 7: Transfer titles/registrations with other agencies

Register of Deeds (LRA/ROD) for real property title transfer.
Local Assessor’s Office for tax declaration updates.
Banks for release/transfer of deposits.
Corporations for share transfer and issuance of new certificates.
LTO for vehicles.

Anti-scam point: Some scams pretend that estate tax payment alone completes the transfer. It does not. Transfers are separate processes requiring eCAR/CAR and other documents.

8) How legitimate BIR assessments and computations arise

Not every increase in tax due is a “scam”—BIR legitimately adjusts computations during evaluation and audit. Understanding the legitimate paper trail is essential.

8.1 Common legitimate scenarios

Clerical or documentary deficiencies: missing proof for deductions, inconsistent asset descriptions, incomplete IDs/TINs.
Valuation adjustments: BIR applies zonal values, higher FMV, or corrects share valuation method.
Disallowance of deductions: lack of receipts, improper claims, missing substantiation.
Post-filing audit: BIR later reviews and issues notices if deficiencies are found.

8.2 Hallmarks of a legitimate assessment (paper trail)

Legitimate BIR actions generally have:

Written notices with reference numbers,
Clear identification of the taxpayer/estate, tax type, taxable period/date,
Computation detail and legal basis,
Proper service (served to the estate representative/heirs or registered address),
A stated period to respond or protest (tax procedure provides specific timelines).

Anti-scam point: Threats of immediate arrest for nonpayment, demands for instant payment through unofficial channels, or refusal to give written computation are strong indicators of fraud.

9) Verifying an estate tax “assessment” or “computed amount”: a practical checklist

A. Verify the source and authority

Confirm the person’s identity: full name, designation, office, and official contact line.
Do not rely on caller ID, messaging apps, or forwarded IDs.
Verify directly with the RDO: whether the person is assigned to the case (as far as the office can confirm) and whether the computation exists in the docket.

B. Verify the document set

Ask for (and check) the following:

Copy of the filed estate tax return (with receiving stamp).
Detailed computation sheet showing:
- asset values with bases (zonal value/tax declaration/bank certificate/AFS),
- deductions with documentary support references,
- penalty computations (surcharge/interest) with dates.
If styled as an “assessment,” check for:
- notice number, date, signature/authority,
- service details,
- response/protest instructions.

C. Verify payment instructions

Legitimate instructions point you to:

The correct AAB for the RDO or the RCO,
Or an official e-payment method recognized by BIR for that tax type.

Never accept:

Personal accounts,
“Pay now, we’ll issue OR later,”
“Pay to reserve your eCAR slot,”
“Pay to prevent case filing,” without written legal basis and official channels.

D. Verify values independently

For real property, compare:
- tax declaration FMV from assessor,
- zonal value schedule applicable to the location,
- the property description (lot, area, classification) used in computation.
For shares, confirm:
- whether listed/unlisted classification is correct,
- financial statements used and their date,
- number of shares and par value/issued shares.
For bank deposits, confirm:
- balance as of date of death,
- interest accrual details if included.

E. Verify authenticity of proof of payment

For bank payments:

Check bank validation markings and transaction references.
Confirm the AAB branch is real and authorized for that RDO.
Retain deposit slips, machine validations, and stamped copies.

For electronic payments:

Ensure confirmations show the correct taxpayer/estate identifiers, tax type, and reference numbers consistent with official formats.

F. Verify eCAR/CAR before transferring

Before presenting to the Register of Deeds or corporation:

Confirm with the issuing RDO that the eCAR/CAR is on record for the specified property.
Check that property details match exactly (title number, lot number, location, area, names).
Confirm that the receiving office (ROD/corporation) accepts the document as authentic and complete.

10) Common estate tax scams in the Philippines (and how to spot them)

Scam 1: “Fixer” offering shortcuts or guaranteed eCAR

Pattern: Claims they can “rush” or “guarantee” approval for a fee; asks for cash, “processing fee,” or payment to personal accounts. Red flags: No official receiving, no complete return, no written computation, refusal to transact at the RDO or through authorized channels. Protection: Deal only through official channels; require verifiable receiving and official payment proofs.

Scam 2: Fake assessment / fake deficiency notice

Pattern: You receive a letter/message demanding payment of a “deficiency” with threats. Red flags: No docket reference; wrong tax type; incorrect names; unrealistic penalties; demands immediate payment. Protection: Verify with the RDO; request the official notice and computation; check service and protest periods.

Scam 3: “BIR officer” messaging on apps with payment links

Pattern: Directs you to pay via link or to “reserve” a slot; uses urgency. Red flags: Non-official link domains, QR codes leading to personal wallets, inconsistent details. Protection: Use only official payment routes; confirm at the RDO.

Scam 4: Fake eCAR/CAR for property transfer

Pattern: Presented as already issued; used to push title transfer. Red flags: Property details slightly off (title number digits, area, names), unusual formatting, no trace at RDO. Protection: Verify issuance with the RDO and acceptance with the Register of Deeds before use.

Scam 5: Overstated “zonal value” or invented penalties

Pattern: Inflates values and penalties to extract a cut or “settlement.” Red flags: No citation to zonal schedule; wrong property classification; penalty rates not tied to dates. Protection: Independently compute or have computation reviewed; insist on written math and bases.

Scam 6: Bank-release scam (estate deposit “clearance fee”)

Pattern: Someone claims to facilitate bank release for a fee, sometimes with fake bank staff. Red flags: Requests for OTPs, account credentials, or payment outside the bank. Protection: Deal only with the bank branch; never share OTPs; banks require documentary compliance and BIR clearances, not private “fees.”

11) Best practices for clean, verifiable compliance

Documentation discipline

Keep a single binder (physical/digital) containing: civil documents, asset proofs, debt proofs, filed returns, payment proofs, and eCAR/CAR.
Ensure names are consistent across documents (spelling, middle names, suffixes).

Transaction discipline

Make payments only in the name of the estate/taxpayer through authorized channels.
Avoid intermediaries handling money.

Computation discipline

Require full schedules and math.
Tie every deduction to a document.
For every asset valuation, keep the source document that supports the number used.

Security and privacy

Limit sharing of death certificates, IDs, and TINs to official transactions.
Be cautious with “document pick-up” services; custody of original titles and civil registry documents is sensitive.

12) Disputes, audits, and remedies (what happens if BIR disagrees)

When BIR disallows deductions or adjusts valuation, the path typically involves:

Receiving a written notice or findings,
Providing documents/explanations within the stated period,
Observing deadlines for administrative remedies (responses/protests),
Elevating to higher administrative levels or courts when warranted.

Key practical point: deadlines matter. Missing a response/protest period can make an assessment final and demandable.

13) A compact “verification card” for heirs

Before paying anything

Do you have a complete estate tax return with schedules?
Is it filed/received at the correct RDO?
Is the computation written, detailed, and sourced?
Are payment instructions limited to AAB/RCO/official channels?
Can the RDO confirm the docket and computation exist?

Before transferring property

Do you have eCAR/CAR for that specific property?
Do the title details match exactly?
Can the RDO confirm issuance?
Can the Register of Deeds/corporation accept it as authentic?

14) Conclusion

Estate tax compliance in the Philippines is a documentation-and-verification exercise: inventory the estate, value assets using recognized bases, claim only substantiated deductions, file in the correct RDO, pay strictly through authorized channels, secure eCAR/CAR, and complete transfers with the proper registries and institutions. Scams thrive where there is urgency, secrecy, off-channel payment, and absence of written computations; the strongest protection is insisting on verifiable documents, official receiving proofs, traceable payment records, and direct confirmation with the issuing offices.