ACTIVITY BOOSTER every TUESDAY in QUEZON AVENUE (ABTin Q. Ave.)!

WHATs NEW, WHATs HOT TOPIC FOR THE DAYBIR TO FOCUS ON ESTATE TAX, EYES P50B BY 2016Estate Tax is a tax on the right of the deceased person to transfer his/her estate to his/her lawful heirs and beneficiaries at the time of death.BIR reminded those who have been planning out their wealth for future distribution to their spouse or children to make sure that their heirs pay the estate tax or face tax evasion chargesSome individuals try to evade estate taxes by selling their properties to their immediate family. By doing this, the surviving entities would only need to pay the capital gains tax.

WHATs NEW, WHATs HOT TOPIC FOR THE DAYHenares said that BIR would check whether the heirs have the financial capacity to purchase the property asset from their parents.BIR has mandated banks to submit statement of accounts of deceased persons in the past 5 years to determine whether these financial institutions have been conniving with the heirs by allowing them to withdraw money from the deceaseds account. Banks will be criminally liable.The bank secrecy law is automatically lifted once a person dies, thus allowing the govt. to look into the bank accounts of dead people.BIR is also coordinating with NSO to check the number of registered deaths vs. number of estate tax returns filed.

How to take advantage of the issueTalk to your well-off clients regarding the topic.Offer the estate owner a detailed Estate Plan with computation.Encourage them to get insurance to cover for the estate tax. Make their heirs as the beneficiaries. The insurance coverage would serve as proof to BIR that the heirs have the financial capacity to purchase the property asset from their parents.

Thank you