if you own a business or property and you don't have the societal status, connections, and assistants that insulates you from bureaucratic tyranny, it is important you read this so you know how to prevent the government from sticking a pole inside the ass of your love ones while they are mourning your death.
even if you don't own a business or property and you have societal status, connections, and assistants that insulates you from bureaucratic tyranny, it is still important you read this so that you won't be traumatized when the masses overwhelmingly vote for a political candidate who murders a child in front of live camera for the whole world to see. the candidate simply has to promise GOVERNMENT EFFICIENCY and cutting bureaucracy (e.g. 10-year driver's license and passport validity, 5-year security guard license validity, etc...) and the candidate will win by a LANDSLIDE.
if you are a political strategist or planning to run for office, it is important you read this so you can easily win an election by promising a DOGE type government efficiency platform by hiring young genius from top universities (e.g. ateneo, UP or Professional Academy of the Philippines in Naga, Cebu) to go in government agencies and make systems more efficient.
here's a glimpse of the horrors i had to go through.
to prevent our properties from becoming worthless due to huge tax penalties, i had to pay the estate taxes of my grandparents before the june 14 tax amnesty deadline. i started gathering the mountain of requirements 6 months ago.
2 months ago, i requested for preliminary computation and inspection of my documents. but the BIR officer insisted that the extrajudicial needs to be signed by all heirs and notarized first before they inspect it. after going through the long process of getting the extrajudicial signed by all heirs and notarized, another BIR officer inspected all my documents and asked me to redo the extrajudicial because my aunt's name "maria theresa" needs to be changed to "ma. theresa". i had to go through the long process of getting all heirs to sign again and pay the big notarial fee again.
when i came back, i requested a preliminary computation again but the assessment officer insisted i complete all requirements first. he inspected all the TIN numbers and told me the TIN number of my aunt was invalid. i told the officer my aunt owns a business therefore they should have the correct number on record. instead of telling me what they had on record, he asked me to file for a new TIN number. i had to spend 2 whole days waiting in line and filling out forms to get the new TIN number. after i got my aunt's new TIN number, another BIR officer told me my aunt had a double TIN and i had to cancel the new TIN i just applied for. i had to spend another 2 whole days waiting in line and filling out forms to cancel the new TIN.
after cancelling the new TIN, i requested again for a preliminary computation so i can start securing the funds which can be in the millions and the amnesty deadline was fast approaching. the assessment officer told me one of the titles had an "adverse claim" and i had to remove the adverse claim before she will compute the estate taxes. i then setup a consultation with my aunt's lawyer (atty nadela). it took a week before i was able to meet with the lawyer because as usual, lawyers are very busy. the lawyer told me it can take months to get the adverse claim removed because we need to file a case in court. i went back to the BIR and told the assessment officer if it's possible to pay the estate taxes just so we can meet the amnesty deadline and we will get the e-cars only after the adverse claim is removed. the BIR consulted with the other officers sitting next to him and they unanimously decided the adverse claim should not be an issue because anyway it will get carried over when the new title is transferred to the heirs. i told them that the previous assessment officer told me otherwise. they advised me to pray that when i come back next time for a computation i don't end up with that same assessment officer.
i requested again for a preliminary computation. the assessment officer told me i needed to submit the 2020 FS and ITR of my grandma's business before a preliminary computation. luckily, my grandma's accountant had the 2020 FS and ITR. but when i came back, it was another assessment officer, who insisted i complete the closure of the business of my grandma first before they do a computation. he said he won't do a preliminary computation because it's too much work. he wants to compute just once.
as it turns out, i had to fill out 74 FORMS to pay a penalty for each month, quarter and year after my grandma's death in 2021. it took me 3 days to fill out the 74 forms (3 copies each with email confirmation on each copy). the penalties totaled P93,000 but you will probably faint when i tell you i was only allowed to pay for 2 forms at a time. after paying for 2 forms, i had to fall in line again and wait for hours before i can pay for another 2 forms. it took me 2 weeks to finally pay the 74 forms even if it should only take 5 minutes.
i submitted the receipts of the 74 forms last week. but the business closure officer told me she can't complete the closure unless my payments get credited in their system. she also does not know when my payments become credited. she said it can take 10 days or even 20 days because it has to go through manila. i told her the amnesty deadline is next week and i will have to pay millions in penalties. she advised me to beg the assessment officer to allow me to pay the estate taxes while waiting for the 74 payments to be credited. on the way home, i stopped by sto. rosario church and prayed to God that the assessment officer i will end up with will find it in his/her heart to allow me to pay the estate taxes even if my business closure payments have not been credited in their system.
the next morning i lined up at 6 am outside the BIR (the BIR opens at 8 am). but the line was already very long. when the BIR closed at 5 pm, my number still wasn't called. if i also won't get attended to the next day, i will miss the amnesty deadline and will have to pay millions in penalties. the security guard advised me to start lining up at 4 am. so i came in at 4 am the next day and luckily, my number was called at 3pm. it was the day before the amnesty deadline.
after an hour of inspecting my documents, the assessment officer congratulated me because i already had completed the requirements. i felt very happy. but then he told me my grandfather's TIN is in maasin leyte and i have to file his estate taxes over there. there is no more time for me to go to leyte and file estate taxes because the amnesty deadline was just a day away. i asked the officer if there is anything that can be done so i can avoid paying the huge penalties for my grandfather's estate taxes (he died in 2014). he told me there is nothing that can be done and consoled me by saying i only have to pay the penalties for half of my grandmother's properties in cebu. i asked him why is it that it's only now they informed me that i have to file my grandfather's estate taxes in leyte? they inspected the TINs numerous times months ago. he told me it should be my responsibility to know these things.
the next day (day of the deadline), i stopped by the BIR to ask if i can pay with manager's check. the line on the public assistance window was so long it took me an hour to get assisted. the officer told me i can pay with manager's check and gave me the format. due to traffic, it was already 11am when i arrived at my bank (BDO). the line in the bank was also long it took an hour before i got attended to. but the teller told me the form from the BIR is useless and i had to go to the specific BIR partner bank to get the exact format. so i sprinted to the nearby BPI (on foot because it was traffic) to get the format. it took another hour for the manger's check to be issued. i sprinted back to BPI to finally pay the estate taxes for my grandma.
but then the teller at the bank told me the cut off time for BIR payments is at 1:30pm and it was already 1:35pm. i screamed and cried and begged the teller to allow me to pay or else i will end up paying P3 million in penalties. the teller asked me to talk to the manager. luckily, the manager felt sorry for me and allowed me to pay even if it's already past the cut off time. but then the manager's check had a wrong spelling (my mother's name was spelled "lourder" instead of "lourdes"). i begged them again to give me time to run to BDO to have it corrected. luckily, they were kind enough to let me so i sprinted back again to BDO to cancel the manger's check and have a new one issued. i was shouting in anger while running in the street and the cops nearby were horrified they probably thought i was about to commit mass murder because i was bringing a very big bag containing the mountain of BIR documents and my laptop. i was finally able to pay my grandma's estate taxes before the amnesty deadline expired. but it's just a half victory because i still need to go to leyte to file my grandfather's estate taxes and pay huge penalties for half of my grandma's properties in cebu.
------------------------------
here are my other experiences that might help you in filing estate taxes:
- if you own a business, make sure you keep the ITRs (income tax returns) copies and inform your love ones where it is located. because when you die, they will have to surrender it to the BIR to close the business and they will have to pay a penalty for each missing ITR and they can only pay 2 at a time. they will have to quit their job or go on a long vacation just to find time to pay for those missing ITRs.
- also make sure all your ITR payments in the past have been uploaded before you die. my grandma has a few ITRs where the ITR was already paid long time ago, we have the copy of the ITR, but the BIR officer told me they were not uploaded in their system so i had to suffer through a long process of requesting those ITRs to be uploaded via email. when i sent the emails, the emails kept bouncing back because the BIR's email server ran out of disk space. i had to fall in line and wait for many hours just to get assistance on the bouncing emails.
- tell your love ones to keep the unused invoices because they need to be surrendered to the BIR when you die. or else they will have to suffer through a long process of filing an affidavit of loss and publishing it in the newspaper and paying huge COMPROMISE penalties.
- tell your love ones where you keep all the permits, certificates and notices from the BIR because they will have to surrender them when you die. or else they will have to fill out forms and pay penalties for those that are missing.
- the list of requirements in the BIR website is just minimal. expect a lot more requirements. example, you need to also get the list of holdings from the provincial capitol and nearby big cities. example, i had to get one for mandaue and lapu lapu. it took me only a day for the provincial and lapu lapu because they did not ask for any requirement but mandaue required me to get the death certificates, birth certificate of my mother, and my birth certificate, which i had to order from wisconsin, USA.
- the BIR requirements don't mention you also need to get a tracer for each property showing that the latest tax dec has not been revised since the time of death
- the BIR requirements don't mention that if the address on the tax dec don't match any entry in their spreadsheet, you need to have a geodetic engineer generate a vicinity map (P2,500 each). i had to do this for each of the 6 properties. this process could take 2 weeks.
- the BIR requirements don't mention that if the lot number of the building tax dec and land tax dec don't match, you will need to go the assessor's office to have them corrected and issue a new one. this can take 3 weeks of processing.
=============================
immediately after that, i approached another BIR officer to follow up a different transaction (because if someone in your family dies someone in your family will need to quit their job and spend 3 months full time doing more than 100 tansactions just to file estate taxes). she told me i should call the number they gave me to follow up. i told her it would be a miracle if someone will answer the phone because in my entire life it never happens where i call a government office in the philippines and someone answers the phone. she proudly and happily told me that she will surely answer the phone because the phone i will be calling is a cellphone that she is holding in her hand. she then showed me the cellphone by waving it up in the air. i laughed so hard and as it turns out, there were other of BIR customers waiting in line listening to our convesation who also laughed. i immediately pulled out my phone and was about to call her cellphone thinking it would be a very funny scene if we will be TALKING TO EACH OTHER ON OUR CELLPHONES WHILE STANDING IN FRONT OF EACH OTHER. but then i realized it would be too cruel especially that there were many spectators enjoying the scene. so i just asked her if it would be better if i just talk to her in person instead of call her phone because we are already standing in front of each other. she laughed after realizing her blunder and told me that of course i can just talk to her directly.
No comments:
Post a Comment