Succession is the transmission of the property, rights, and obligations of a deceased person to his or her heirs. Under Philippine law, this transmission takes effect at the exact moment of death. The rules governing inheritance and estate settlement are primarily found in the Civil Code of the Philippines (Republic Act No. 386), particularly Articles 774 to 1105, supplemented by the Family Code of the Philippines, the Rules of Court (Special Proceedings, Rules 72 to 91), the National Internal Revenue Code (NIRC) as amended by the Tax Reform for Acceleration and Inclusion (TRAIN) Law (Republic Act No. 10963), and other special laws such as the Code of Muslim Personal Laws (Presidential Decree No. 1083) for Muslim Filipinos.

The estate of the decedent includes all property, real and personal, tangible and intangible, existing at the time of death, as well as any property acquired by the estate after death. Philippine inheritance law distinguishes between conjugal or community property (if the decedent was married under the regime of absolute community or conjugal partnership) and the decedent’s exclusive or capital property. Only the decedent’s share in the conjugal or community property, plus his or her exclusive property, forms part of the estate subject to succession.

I. Kinds of Succession

Philippine law recognizes three kinds of succession:

Testamentary Succession – Property is distributed according to a valid will.
Legal or Intestate Succession – Property passes by operation of law when there is no will, the will is invalid, or the will does not dispose of the entire estate.
Mixed Succession – Part of the estate is disposed of by will and the remainder passes by intestacy.

II. Testamentary Succession: The Law on Wills

A will is an act whereby a person disposes of his estate, to take effect after his death. It is essentially ambulatory and revocable during the testator’s lifetime.

Testamentary Capacity
The testator must be at least eighteen (18) years of age and of sound mind at the time of execution. Sound mind means the testator knows the nature of the testamentary act, knows the approximate value and nature of his property, and knows the natural objects of his bounty (his compulsory heirs).

Formal Requisites of Wills

Notarial (Ordinary) Will: Must be in writing, in a language or dialect known to the testator, subscribed at the end by the testator or by another in his presence and express direction, and attested and signed by three (3) or more instrumental witnesses in the presence of the testator and of one another. It must be acknowledged before a notary public.
Holographic Will: Must be entirely written, dated, and signed by the hand of the testator himself. No witnesses are required. It may be made in any language.

Additional rules apply: a notarial will must be signed on every page by the testator and witnesses (except the last page), and a codicil (supplement or amendment) must follow the same formalities as a will.

Substantive Requisites
The will must not contravene law, public policy, or morals. Preterition (total omission of a compulsory heir) annuls the institution of heirs but not the entire will. Disinheritance must be for a legally prescribed cause expressly stated in the will. Unworthiness to succeed (e.g., conviction for attempting to kill the decedent, false accusation of a crime punishable by more than six years’ imprisonment against the decedent) may disqualify an heir even if named in the will.

Revocation and Revival
A will may be revoked expressly (by a subsequent will or codicil) or impliedly (by acts such as burning, tearing, or canceling the will with intent to revoke). A later will that does not expressly revoke the earlier one revokes it only to the extent of inconsistency. A revoked will may be revived by a subsequent will or codicil expressly or impliedly.

Probate of Wills
No will shall pass either real or personal property unless it is proved and allowed in a proper court. Probate is a special proceeding in the Regional Trial Court (RTC) of the decedent’s domicile at the time of death (or where the estate is situated if the decedent was a non-resident). Once probated, the will becomes conclusive as to its due execution.

III. Compulsory Heirs and Legitime

Compulsory heirs are entitled to a reserved portion called legitime, which cannot be deprived except by valid disinheritance:

Legitimate children and descendants (primary and preferred).
In default of the above, legitimate parents and ascendants.
The surviving spouse.
Illegitimate children (each entitled to one-half of the legitime of a legitimate child).

The legitime of legitimate children is one-half (½) of the hereditary estate, divided equally among them. The surviving spouse receives a legitime equal to that of a legitimate child if there are legitimate children, or one-fourth (¼) of the estate if there are no legitimate children but illegitimate children exist. Illegitimate children collectively receive one-half of the legitime of legitimate children. The remaining portion of the estate (free portion) may be freely disposed of by will.

Donations inter vivos to compulsory heirs are subject to collation (brought back into the estate for computation of legitime) unless expressly stated otherwise.

IV. Intestate Succession

Intestate succession applies when there is no will, the will is void, or it does not cover the entire estate. The order of heirs is as follows (in the absence of compulsory heirs in the higher class):

Legitimate children and descendants.
Legitimate parents and ascendants (in default of descendants).
Illegitimate children and the surviving spouse (concurring).
Surviving spouse alone (if no children or parents).
Siblings, nephews, nieces, and other collaterals up to the fifth degree.
The State (escheat), if no heirs exist.

The surviving spouse concurs with legitimate children (receiving equal share) or with illegitimate children (receiving one-half the share of an illegitimate child) or with parents (receiving one-fourth). Representation (per stirpes) applies in favor of descendants of predeceased heirs.

V. Settlement of the Estate

Settlement may be extrajudicial or judicial.

A. Extrajudicial Settlement
Allowed when:

The decedent died intestate.
There are no outstanding debts of the estate (or all debts have been paid).
All heirs are of legal age or represented by judicial guardians.
The heirs agree on the division.

The heirs execute a Deed of Extrajudicial Settlement of Estate (or Affidavit of Self-Adjudication if there is only one heir). The document must be published in a newspaper of general circulation once a week for three consecutive weeks. A bond equal to the value of the personal property may be required if there are minor heirs or if real property is involved. After two years from settlement, the heirs may petition for cancellation of the bond.

For small estates (those whose gross value does not exceed the amount fixed by the Supreme Court from time to time), summary settlement proceedings under Rule 74 may be used even with a will, provided all interested parties agree.

B. Judicial Settlement
Required when:

There is a will (probate is mandatory).
There are debts.
There are minor or incapacitated heirs without proper representation.
The heirs cannot agree on the division.
Any interested party files a petition.

Proceedings are initiated by a petition for probate of the will or for letters of administration (if intestate). An administrator or executor is appointed, an inventory is filed, debts are paid, taxes settled, and the estate is partitioned among the heirs. The court issues an order of distribution only after all obligations are satisfied.

VI. Estate Taxes and Other Fiscal Obligations

Under the TRAIN Law, estate tax is imposed at a flat rate of six percent (6%) of the net estate. The net estate is the gross estate minus allowable deductions (funeral expenses up to a certain limit, judicial expenses, claims against the estate, unpaid mortgages, standard deduction of Five Hundred Thousand Pesos (P500,000), family home up to Ten Million Pesos (P10,000,000), and other deductions provided by law).

The estate tax return (BIR Form No. 1801) must be filed within one (1) year from the decedent’s death, and the tax must be paid within the same period (extensions may be granted). A Certificate Authorizing Registration (CAR) issued by the Bureau of Internal Revenue (BIR) is required before any title to real property or shares of stock can be transferred. Failure to pay estate tax incurs interest, surcharge, and possible criminal liability.

Other taxes may apply upon distribution or sale of inherited property (e.g., documentary stamp tax, capital gains tax on subsequent sale, transfer tax on shares).

VII. Distribution, Partition, and Title Transfer

After payment of debts and taxes, the net estate is distributed according to the will or the rules of intestacy. Partition may be by agreement (deed of partition) or by court order. Real properties require registration with the Registry of Deeds; titles are transferred by presenting the deed of extrajudicial settlement or court order together with the CAR and other documents. Personal property (vehicles, bank accounts) requires specific transfer procedures with the Land Transportation Office, banks, or other agencies.

Collation ensures that advances or donations to compulsory heirs are accounted for to protect legitimes. Any heir who receives more than his share may be required to return excess.

VIII. Special Considerations

Preterition and Disinheritance: Total omission of a compulsory heir in the direct line annuls the institution of heirs; disinheritance requires an express statement of a legal cause in the will.
Contracts in Relation to Succession: Donations mortis causa must comply with will formalities. Agreements renouncing future inheritance are generally void.
Muslim Filipinos: Succession is governed by the Code of Muslim Personal Laws, which recognizes different shares for male and female heirs and allows certain testamentary freedoms.
Foreigners and Conflict of Laws: Real property located in the Philippines is governed by Philippine law (lex rei sitae). Personal property follows the national law of the decedent (lex domicilii or lex patriae). Dual citizens and Filipinos abroad must comply with Philippine estate tax on worldwide assets if residents, or only Philippine-situs assets if non-residents.
Adoption and Illegitimacy: Adopted children have the same rights as legitimate children. Legitimated children (by subsequent marriage of parents) are treated as legitimate.
Guardianship and Trusteeship: Minors or incapacitated heirs require court-appointed guardians or trustees to receive and manage their shares.

IX. Prescription and Laches

Actions to enforce hereditary rights prescribe after ten (10) years from the date the right accrues (e.g., from the issuance of title in the heir’s name or from discovery of fraud). Extrajudicial settlements may be impugned within two (2) years on grounds of fraud.

Estate settlement in the Philippines balances respect for the decedent’s wishes with mandatory protection of family rights through legitime. The process ensures orderly transfer of property while satisfying creditors and the government’s tax claims. Every estate presents unique factual considerations—whether involving complex family structures, substantial business interests, or properties located both in the Philippines and abroad—making careful planning through a valid will and timely legal assistance essential for efficient settlement.