A client approached me with a house and lot in Laguna that was still titled in her late mother’s name. Her siblings wanted to sell.
The buyer’s lawyer had asked for an Electronic Certificate Authorizing Registration (eCAR), and nobody in the family knew what it was, who issues it, or what it would really cost.
As a licensed lawyer and real estate broker, I hear from heirs and overseas Filipinos in this spot all the time.
The tax itself is a flat 6% of the net estate. The paperwork around it is often what delays a family.
This guide covers the rate, the deductions, the deadline, the penalties and the Bureau of Internal Revenue (BIR) requirements, and it tells you where the estate tax amnesty stands today.
Every scenario here is a composite.
Estate tax is a one-time national tax on passing a deceased person’s property to their heirs. You pay it to the BIR, based on what the person owned on the day they died. Dates matter.
The law in force on the date of death decides the rate and the deductions, which can make a big difference when the death happened many years ago.
For example, your father may have worked in Riyadh and left savings there, plus a lot in Pangasinan. Both count.
A Filipino citizen or resident is taxed on property worldwide, so the Riyadh savings and the Pangasinan lot both land in his estate, wherever each one sits. A nonresident alien is taxed only on property located in the Philippines.
The estate owes the tax, and the heirs deal with the BIR on its behalf. Settling it comes first.
Your family usually can’t sell, mortgage or transfer what was left until the BIR has signed off on the estate and issued the papers that go with it.
For deaths on or after January 1, 2018, the Tax Reform for Acceleration and Inclusion (TRAIN) Law, Republic Act No. 10963, sets a flat 6% rate on the net estate.
The computation takes 3 steps:
I’ve had clients ask whether they can get a rough number before committing to anything. You can. The arithmetic fits on a napkin.
For example, take a widowed father who leaves a lot in Batangas valued at ₱7,000,000 and ₱1,000,000 in the bank, with no debts, and the lot isn’t the family home.
| Step | Amount |
|---|---|
| Gross estate | ₱8,000,000 |
| Less standard deduction | ₱5,000,000 |
| Net estate | ₱3,000,000 |
| Estate tax at 6% | ₱180,000 |
I made these figures up to show the arithmetic, so please don’t treat ₱180,000 as an estimate for your own family, whose property, debts and deductions will look different.
Real property is usually valued at the higher of the BIR zonal value and the assessor’s fair market value. An old tax declaration may show a lower number than the one the BIR uses. Online calculators run on the same formula.
Pro Tip: Ask a lawyer or an accountant to check the result before you pay.
People search for an estate tax exemption, but the law doesn’t exempt estates outright. Here’s how it works.
It lets you subtract certain amounts from the gross estate before the 6% applies, and the table below shows the ones I look at first when a family brings me a title.
| Deduction | Amount |
|---|---|
| Standard deduction for citizens and residents | ₱5,000,000, with no receipts needed |
| Standard deduction for nonresident aliens | ₱500,000 |
| Family home | Fair market value or ₱10,000,000, whichever is lower |
| Claims against the estate and unpaid mortgages | The actual amount, with proof |
| Property inherited earlier and already taxed | The vanishing deduction, within the limits the law sets |
Funeral, medical and judicial expenses used to be deductible. Not anymore. The TRAIN Law removed them, so please don’t plan on subtracting the hospital bills or the cost of the wake from the gross estate before you apply the 6%.
Even when the math comes to zero, you still need the BIR to issue the eCAR before the title can move.
Take a family where the mother died and left a house and lot, and the father is still living. Start with who owns what.
Half of the property a couple built during the marriage usually belongs to the surviving spouse from the start, so only the mother’s share goes into her estate.
Her share then passes to the father and the children as heirs. I’d put the title and the marriage details in front of a lawyer before computing anything, because the couple’s property regime decides who owns what.
The BIR expects the estate tax return, BIR Form 1801, and the payment within 1 year of death, filed with the Revenue District Office (RDO) that covers where the person last lived.
Put that date on your calendar early.
An heir in Dubai, for example, doesn’t have to fly home just to file. Here’s the good news. A relative in the Philippines can file and follow up under a Special Power of Attorney (SPA), so nobody has to stand in line for you.
In some cases the BIR also allows an extension, so ask your RDO before the year runs out.
I know deadlines slip, especially when a family is grieving or scattered across countries. Here’s how the charges work.
If the 1 year passes without a filing, the BIR adds a 25% surcharge on the unpaid tax, and 12% interest a year keeps running until the tax is paid.
The surcharge rises to 50% only if the BIR finds willful neglect or a fraudulent return.
A client told me her grandmother’s estate had sat unsettled for years, and her biggest worry was whether the BIR would ever come after the family. I can’t promise you it will or won’t.
But here’s what I can tell you. The interest keeps running every year. The title stays in the name of the person who died, so you can’t sell it, mortgage it or put it in your own name.
And each time an heir passes away before the estate is settled, more people have to sign.
If the year has already passed, take a breath. It’s usually fixable.
The first step is simply finding out the real number, and I’d rather you learn it from the BIR and your lawyer than guess from what a neighbor paid.
The BIR checks your papers before it releases the eCAR, so gather everything before you go, and confirm the current checklist with your RDO because requirements vary from one office to another.
Expect to prepare:
After you pay, the BIR issues one eCAR for each property. Then comes the Registry of Deeds.
Bring the eCAR, the settlement document and the old title to get a new title in the heirs’ names, then update the tax declaration at the assessor’s office.
I’ve had clients ask whether they need a lawyer because the document list looks so long, and the honest answer is that filing the return itself doesn’t require one.
I’d consider hiring a property lawyer when:
The estate tax amnesty let heirs of people who died on or before May 31, 2022 pay a flat 6% without the surcharges, penalties or interest that the regular rules would have added.
It came from Republic Act No. 11213, extended by Republic Act Nos. 11569 and 11956. The program ended on June 14, 2025.
Congress is working on a reopening. The House approved House Bill No. 6614 in December 2025, and the Department of Finance backs an extension to December 31, 2028, but several Senate bills are still pending and none has become law. Until the President signs one, the regular rules apply, with the surcharge and the interest.
If you’ve read that the amnesty runs through 2028, you’re reading about the proposal, not the current law.
A family approached me about a mother who died in 2010 and left a house and lot, with the father still alive. They wanted to know how to apply the exemptions and deductions to a death that old, and the first thing I told them is that the answer starts with the year of death.
Here’s why.
The 2018 numbers don’t apply. A death before January 1, 2018 falls under the older rules, which used graduated rates that rose with the size of the estate and a different set of deductions.
If the death was on or before May 31, 2022, the amnesty used to cover it at a flat 6%, which is why the pending extension matters so much to these families.
I can’t give you a figure without the title, the valuation and the year of death in front of me.
Another family came to me after buying a lot in the province from a widow. The title was still in her late husband’s name, with hers beside it as “married to.” They had paid in full.
Then she moved abroad and stopped answering. When they tried to transfer the title to the mother’s name, an officer told them the estate tax had to cover everything the husband owned, including lots they never bought.
If you’re in the same spot, I know your stomach drops. It feels like a shakedown.
Estate tax is computed on the whole net estate, not lot by lot, so the BIR will usually want the return to list every property the husband left. The demand may not be improper at all. It may simply be how the tax works.
Here’s what I’d do first.
The tax belongs to the estate and its heirs, so the job is finding the heirs and getting them to sign the settlement, even though they may be hard to reach.
Before you pay a number you can’t see, ask the office to put the demand and the computation in writing.
A real estate lawyer can check whether an amnesty, if it returns, would shrink the bill, and whether a court route makes more sense.
Bring the deed of sale, your proof of payments, the title and anything that shows how to reach the seller or her family.
Estate tax and real estate tax sound alike and get mixed up often. They’re different taxes.
Estate tax is the one-time national tax covered above, paid to the BIR when property passes at death.
Real estate tax, also called real property tax, is the yearly tax on land and buildings that you pay to the city or municipality where the property sits.
You’ll deal with both.
The BIR usually asks for the latest tax declarations and proof that the real estate tax is paid up, so unpaid yearly bills can hold up the transfer.
Every estate is different, so the right next step depends on your title, your heirs, the year of death and whether the other family members are ready to sign.
Bring whatever documents you have.
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