Estate Tax Calculator Philippines: How to Compute What You Owe in 2026
Estate Tax Calculator Philippines: How to Compute What You Owe in 2026
Calculating estate tax in the Philippines is straightforward once you understand the formula, but most families overpay because they miss deductions they are legally entitled to. Here is how to compute the exact amount before you file BIR Form 1801.
The Basic Formula
The computation follows four steps:
- Gross estate = total fair market value of all assets owned by the deceased at the time of death
- Allowable deductions = standard deduction + family home + claims against the estate + other qualified deductions
- Net taxable estate = gross estate minus allowable deductions
- Estate tax = 6% of the net taxable estate
If the net taxable estate is zero or negative (deductions exceed the gross estate), no tax is owed — but you still must file the return to get the eCAR.
Step 1: Determine the Gross Estate
Include everything the deceased owned at the date of death:
| Asset Type | Valuation Method |
|---|---|
| Real property (land, house, condo) | Higher of BIR zonal value or municipal assessor's fair market value |
| Bank deposits (savings, checking, time deposits) | Balance as certified by the bank on the date of death |
| Stocks and securities | Closing price on date of death (listed) or book value (unlisted) |
| Motor vehicles | Current fair market value |
| Business interests | Net asset value of the deceased's share |
| Personal property (jewelry, art, collections) | Appraised value |
| Receivables | Face value of amounts owed to the deceased |
For non-resident foreign nationals, only assets located within the Philippines are included in the gross estate.
Step 2: Claim Every Deduction
This is where most families leave money on the table. Under the TRAIN Law, the available deductions are:
Standard deduction: PHP 5,000,000 — automatic, no documentation required beyond listing it on the return.
Family home deduction: up to PHP 10,000,000 — the fair market value of the family home, capped at PHP 10 million. The deceased must have actually resided there. Only one family home qualifies.
Claims against the estate — debts the deceased owed at death: outstanding mortgage balances, hospital bills, personal loans with written documentation, credit card balances. Each claim must be substantiated with contracts, billing statements, or certifications.
Claims against insolvent persons — amounts owed to the deceased by people or entities unable to pay.
Transfers for public use — property bequeathed to the government or accredited charitable institutions.
Property previously taxed (vanishing deduction) — if the deceased inherited property that was already subject to estate tax within the past five years, a partial deduction applies to avoid double taxation.
Free Download
Get the Death in Philippines — Expat Emergency Checklist
Everything in this article as a printable checklist — plus action plans and reference guides you can start using today.
Step 3: Run the Numbers
Example 1: Moderate estate
- Gross estate: PHP 12,000,000 (house worth PHP 8M + bank deposits PHP 3M + car PHP 1M)
- Standard deduction: PHP 5,000,000
- Family home: PHP 8,000,000
- Net taxable estate: PHP 12M - PHP 5M - PHP 8M = negative (zero tax)
- Estate tax owed: PHP 0
Even with no tax owed, you must still file Form 1801 and get the eCAR to transfer the assets.
Example 2: Larger estate
- Gross estate: PHP 25,000,000
- Standard deduction: PHP 5,000,000
- Family home: PHP 10,000,000 (capped)
- Claims against estate: PHP 2,000,000 (mortgage)
- Net taxable estate: PHP 25M - PHP 5M - PHP 10M - PHP 2M = PHP 8,000,000
- Estate tax: 6% × PHP 8,000,000 = PHP 480,000
Example 3: Small estate
- Gross estate: PHP 4,000,000
- Standard deduction: PHP 5,000,000
- Net taxable estate: negative (zero tax)
- Estate tax owed: PHP 0
Estates below PHP 5 million effectively owe nothing — the standard deduction alone wipes out the tax.
Penalty Calculations for Late Filing
The estate tax amnesty expired on June 14, 2025. If you are filing late in 2026, here is what the penalties look like:
Base tax: computed as above.
25% surcharge: applied to the base tax immediately upon late filing.
12% annual interest: calculated from the original due date (one year after death) until the date of actual payment.
For example, if the base tax is PHP 300,000 and you file two years late:
- Surcharge: 25% × PHP 300,000 = PHP 75,000
- Interest: 12% × PHP 300,000 × 2 years = PHP 72,000
- Total due: PHP 447,000 (49% more than the base tax)
The interest does not compound on the surcharge — only on the base tax — but it adds up fast.
The Direct Withdrawal Trade-Off
Before running this calculator, decide whether you will use the one-year direct bank withdrawal option (6% withholding on each withdrawal, no deductions) or file a full return (deductions apply, eCAR required for release). For estates with deductions exceeding the cash in bank accounts, the full return almost always saves money.
The Someone Died in Philippines: English Speaker's Emergency Guide includes worked examples for common estate scenarios and walks you through the complete BIR filing process from TIN application through eCAR release.
Get Your Free Death in Philippines — Expat Emergency Checklist
Download the Death in Philippines — Expat Emergency Checklist — a printable guide with checklists, scripts, and action plans you can start using today.