ESTATE TAX

► Atty. Jules E. Riego

► Principal, SGV & Co.
► [email protected]
 ESTATE TAX

 Sections 84 to 97 of the National Internal

Revenue Code (NIRC)

 Implemented by BIR Revenue Regulations

No. 02-03 dated December 16, 2002
 ESTATE TAX

 The transfer of the net estate of every

decedent, whether resident or non-resident
of the Philippines, shall be subject to the
estate tax.

 The entire value of the net estate is divided

into brackets and each rate is imposed on
the corresponding bracket. (Section 2, RR
02-03)
 ESTATE TAX
► COMPUTATION:

Gross Estate
(-) Deductions

= Net Estate
x
Applicable Estate Tax Rate (%)

= Estate Tax Due

 ESTATE TAX
If the net estate is:
Over But Not The Tax Of the
Over Shall Be Plus Excess Over
P200,000 Exempt

P200,000 500,000 0 5% P200,000

500,000 2,000,000 P15,000 8% 500,000

2,000,000 5,000,000 135,000 11% 2,000,000

5,000,000 10,000,000 465,000 15% 5,000,000

10,000,000 And Over 1,215,000 20% 10,000,000”

 ESTATE TAX
GROSS ESTATE:

Resident Decedent (citizen or foreigner):

The value of the gross estate of the decedent shall be
determined by including the value at the time of his death of
all property, real or personal, tangible or intangible, wherever
situated.

Nonresident Decedent not Citizen of the Philippines:

Only that part of the entire gross estate which is
situated in the Philippines shall be included in his taxable
estate. (Section 85, NIRC)
 ESTATE TAX
"SECTION 104. Definitions. — For purposes of this Title, the terms 'gross estate' and
'gifts' include real and personal property, whether tangible or intangible, or mixed, wherever
situated: Provided, however, That where the decedent or donor was a nonresident alien at
the time of his death or donation, as the case may be, his real and personal property so
transferred but which are situated outside the Philippines shall not be included as part of
his 'gross estate' or 'gross gift': Provided, further, That franchise which must be exercised in
the Philippines; shares, obligations or bonds issued by any corporation or sociedad
anonima organized or constituted in the Philippines in accordance with its laws; shares,
obligations or bonds by any foreign corporation eighty-five percent (85%) of the
business of which is located in the Philippines, shares, obligations or bonds issued by any
foreign corporation if such shares, obligations or bonds have acquired a business situs
in the Philippines; shares or rights in any partnership, business or industry established in the
Philippines, shall be considered as situated in the Philippines: Provided, still further, That no
tax shall be collected under this Title in respect of intangible personal property: (a) if the
decedent at the time of his death or the donor at the time of the donation was a citizen and
resident of a foreign country which at the time of his death or donation did not impose a
transfer tax of any character, in respect of intangible personal property of citizens of the
Philippines not residing in that foreign country, or (b) if the laws of the foreign country of which
the decedent or donor was a citizen and resident at the time of his death or donation allows a
similar exemption from transfer or death taxes of every character or description in respect of
intangible personal property owned by citizens of the Philippines not residing in that foreign
country.
 FMV at the Time of Death
► Valuation Of The Gross Estate (Section 5, Revenue Regulations No. 2-
03)

► Real Property (Section 88 (B), NIRC)

► Higher between FMV of BIR or FMV of Assessor
► (Zonal Value of BIR or MV per Tax Declaration )
► Shares of Stock
► Unlisted common shares - book value
► Unlisted preferred shares - par value
In determining the book value of common shares,
appraisal surplus shall not be considered as well as the
value assigned to preferred shares, if there are any.
► Listed shares - arithmetic mean between the highest
and lowest quotation at a date nearest the date of
death, if none is available on the date of death itself
 ESTATE TAX
► Valuation Of The Gross Estate (Section 5, Revenue Regulations No. 2-
03)

► Right to usufruct, use or habitation, as well as that of

annuity

► Take into account the probable life of the beneficiary in

accordance with the latest basic standard mortality table,
to be approved by the Secretary of Finance, upon
recommendation of the Insurance Commissioner.
 ESTATE TAX
BIR Ruling No. DA-067-07
Estate Tax Exemption under RA 6246

Section 6 of RA 6246 provides that:

All foreign currency deposits made under this Act, as

amended by P.D. No. 1035, as well as foreign currency
deposits authorized under P.D. No. 1034, including interest
and all other income or earnings of such deposits, are
hereby exempted from any and all taxes whatsoever
irrespective of whether or not these deposits are made by
residents or nonresidents so long as the deposits are eligible
or allowed under aforementioned laws and, in the case of
nonresidents, irrespective of whether or not they are
engaged in trade or business in the Philippines.“
 ESTATE TAX
Inclusions in Gross Estate (Sec. 85 NIRC)

 Decedent's Interest
 Transfer in Contemplation of Death
 Revocable Transfer
 Property Passing Under General Power of Appointment
 Proceeds of Life Insurance
 Prior Interests
 Transfers for Insufficient Consideration
 Capital of the Surviving Spouse
 ESTATE TAX
Inclusions in Gross Estate (Sec. 85 NIRC)

► Decedent’s Interest
► This refers to value of the decedent’s right or expectation (short of
naked title) on a property.

► Transfers in Contemplation of Death

► The value of any disposition, whether by trust or otherwise, that is
intended to take place only after the decedent’s death (donation
mortis causa).
 ESTATE TAX
Inclusions in Gross Estate (Sec. 85 NIRC)

► Revocable Transfers
► The value of any transferred property where the decedent
retained his power to amend, alter or revoke the transfer during his
lifetime. This is regardless of whether he actually exercised his
power or not.

► Transfers with Retention of Rights of Ownership

► This refers to the value of any transfer where the decedent
retained the power to enjoy the fruits or income of the asset during
his lifetime. Since this means that the transfer done by decedent is
not absolute and transfer of all rights of ownership will only take
place upon his death, the value of the asset transferred should still
be considered part of his gross estate.
 ESTATE TAX
Inclusions in Gross Estate (Sec. 85 NIRC)

► Property Passing under the General Power of

Appointment
► This refers to the value of any property transferred to the decedent
during his lifetime wherein he was given the power to appoint any
person, including himself, to be the recipient or beneficiary. Since
the decedent enjoys the right to dispose the property any way he
wants to as if he is the owner, the value of such property should be
included in his gross estate.
 ESTATE TAX
Inclusions in Gross Estate (Sec. 85 NIRC)

► Proceeds of Life Insurance

► The value of insurance proceeds from insurance policies taken out
by the decedent upon his own life should be included in the gross
estate of the decedent when the designation of the beneficiary is
revocable or when the decedent has made himself or his estate,
his executor or administrator as the beneficiary regardless of
whether the designation is irrevocable or not.

To be excluded from gross estate (exempt from estate tax)

1. Taken upon one’s life
2. Beneficiary is another (not insured, his estate or executor)
3. Designation of beneficiary is irrevocable
Section 85 (E) “except when it is expressly stipulated that the
designation of the beneficiary is irrevocable.”
 ESTATE TAX
Inclusions in Gross Estate (Sec. 85 NIRC)

► Transfers for Insufficient Consideration

► This refers to the excess of the fair market value at the time of
death over the value of the consideration received by the decedent
for any disposition by sale that he made during his lifetime that is
less than a bona fide sale for an adequate and full consideration in
money or money’s worth.

► Property owned in Common with Surviving Spouse

► The value of any property owned in common with the surviving
spouse should be included in the decedent’s gross estate.
However, the value of the equal share of the surviving spouse
should be deducted from the estate after all conjugal expenses
have been deducted from the gross estate.
 ESTATE TAX
Deductions Allowed From Gross Estate for estates of a
Citizen and a Resident (Sec. 86 (A) NIRC):

 Funeral Expense
 Judicial Expense
 Claims Against the Estate
 Claims Against Insolvent Persons
 Mortgage Indebtedness, Taxes and Loss
 Vanishing Deduction
 Transfer for Public Use
 Family Home
 ESTATE TAX
Deductions Allowed for estates of a Citizen and a
Resident: (cont’d)

 Standard Deduction
 Medical Expenses
 ESTATE TAX
Deductible Expenses (Sec. 86 (A) NIRC)

► Funeral Expense
► Actual funeral expenses includes cost of clothes for bereavement
or 5% of the gross estate, whichever is lower but in no case to
exceed PhP200,000.00

► Judicial Expense
► Fees of executors, administrators and lawyers as well as expenses
for the preservation of the estate.

► Claims Against the Estate

► Third-party creditor claims like loans obtained by the decedent.
They must be evidenced by a notarized agreement.
 ESTATE TAX
Deductible Expenses (Sec. 86 (A) NIRC)

► Claims Against Insolvent Persons

► Basically, bad debts/receivables of the decedent.

► Mortgage Indebtedness, Taxes and Loss

► This refers to unpaid mortgages, unpaid taxes before the death of
decedent and any losses from fire, theft or embezzlement incurred
by the estate that is not covered by insurance.
 ESTATE TAX
Deductible Expenses (Sec. 86 (A) NIRC)

► Vanishing Deduction
► Certain percentage of the value of an asset may be deducted from
the gross estate if they were acquired by inheritance or by
gratuitous title by the decedent at a time proximate to the
decedent’s death. Ex. The value of property acquired by decedent
by inheritance at least four years but not more than five years
before his/her death his death may be deducted from his gross
estate to the extent of 20% thereof. If such property was inherited
by the decedent within one year before his death, then, 100% of
the value of such asset is deductible from his gross estate.

► Transfer for Public Use

► Any bequeath, legacies, devisees to the Philippine government or
any of its political subdivisions for public use.
 ESTATE TAX
Deductible Expenses (Sec. 86 (A) NIRC)

► Family Home
► The actual fair market value of the decedent’s family home or
PhP1 Million, whichever is lower.

► Standard Deduction
► The amount of PhP1 Million is deductible, no questions asked.

► Medical Expenses
► Actual medical expenses incurred within one (1) year prior to the
death of the decedent or PhP500,000.00, whichever is lower.
 ESTATE TAX
Deductions Allowed for estates of Non Residents Aliens
(Sec. 86 (B) NIRC):
 Expenses, Losses, Indebtedness and Taxes
 Funeral Expense
 Judicial Expense
 Claims Against the Estate
 Claims Against Insolvent Persons
 Mortgage Indebtedness, Taxes and Loss

 Vanishing Deduction

 Transfers for Public Use

►
 ESTATE TAX
Exemptions and Reliefs

► As can be seen from the table above, it is only when the

net estate is below PhP 200,000.00 that the estate will be
exempt from estate tax.
 ESTATE TAX
Exemptions and Reliefs

However, the following transmissions are also not subject to

estate tax:
(a) The merger of usufruct in the owner of the naked title;
(b) The transmission or delivery of the inheritance or legacy by the
fiduciary heir or legatee to the fideicommissary;
(c) The transmission from the first heir, legatee or donee in favor of
another beneficiary, in accordance with the desire of the
predecessor; and
(d) All bequests, devises, legacies or transfers to social welfare,
cultural and charitable institutions, no part of the net income of
which inures to the benefit of any individual: Provided, however,
That not more than thirty percent (30%) of the said bequests,
devises, legacies or transfers shall be used by such institutions for
administration purposes.
 ESTATE TAX
Filing Procedures
► Before an estate tax return can be filed, the executor, administrator or
heirs must apply for a new tax identification number (TIN) for the
estate using BIR Form 1901. The TIN of the decedent will be
cancelled.

► A notice of death must be filed by the executor, administrator or any of

the legal heirs within two (2) months after the decedent's death with
the Revenue District Office (RDO) that has jurisdiction over the place
of the decedent’s residence at the time of his death or if there be no
legal residence in the Philippines, with the Office of the
Commissioner. The notice of death is required to be filed where the
gross value of the estate exceeds PhP20,000.00.
 ESTATE TAX
Filing Procedures

► An estate tax return (BIR Form 1801) is required to be

filed when the gross value of the estate is over
PhP200,000.00 or regardless of the gross value of the
estate, where the estate is composed of real properties,
shares of stock or motor vehicles or any property where a
BIR tax clearance is required as a condition precedent for
the transfer of ownership.
 ESTATE TAX
Filing Procedures

► Estate tax returns showing a gross value exceeding Two

million pesos (P2,000,000) shall be supported with a
statement duly certified to by a Certified Public Accountant
containing the following:

(a) Itemized assets of the decedent with their corresponding gross

value at the time of his death, or in the case of a nonresident, not
a citizen of the Philippines, of that part of his gross estate situated
in the Philippines;
(b) Itemized deductions from gross estate allowed under the law; and
(c) The amount of tax due whether paid or still due and outstanding.
 ESTATE TAX
Filing Procedures

► Estate tax returns are required to be filed within six (6)

months from the decedent's death. The Commissioner
shall have authority to grant, in meritorious cases, a
reasonable extension not exceeding thirty (30) days for
filing the return.

► If there is estate tax payable, the estate tax must be filed

and paid with the authorized agent bank of the Revenue
District Office that has jurisdiction over the place of the
decedent’s residence at the time of his death or if there be
no legal residence in the Philippines, with the Office of the
Commissioner.
 ESTATE TAX
Filing Procedures
► The estate tax must be paid at the time the return is filed by the
executor, administrator or the heirs. However, if the Commissioner
finds that the payment on the due date of the estate tax or of any part
thereof would impose undue hardship upon the estate or any of the
heirs, he may extend the time for payment of such tax or any part
thereof not to exceed five (5) years, in case the estate is settled
through the courts, or two (2) years in case the estate is settled
extrajudicially. In such case, the amount in respect of which the
extension is granted shall be paid on or before the date of the
expiration of the period of the extension, and the running of the
Statute of Limitations for assessment as provided in Section 203 of
this Code shall be suspended for the period of any such extension.
 ESTATE TAX
Filing Procedures

► A certified copy of the schedule of partition and the order

of the court approving the same shall be furnished the
Commissioner within thirty (30) days after the
promulgation of such order

► If an extension is granted, the Commissioner may require

the executor, or administrator, or beneficiary, as the case
may be, to furnish a bond in such amount, not exceeding
double the amount of the tax and with such sureties as
the Commissioner deems necessary, conditioned upon
the payment of the said tax in accordance with the terms
of the extension.
 ESTATE TAX
Assessments and Valuations

► The estate shall be appraised at its fair market value as of

the time of death. However, the appraised value of real
property as of the time of death shall be, whichever is the
higher of —

(a) The fair market value as determined by the Commissioner, or

(b) The fair market value as shown in the schedule of values fixed by
the Provincial and City Assessors.
 ESTATE TAX
Assessments and Valuations

► With respect to usufruct, the value of the right of usufruct,

use or habitation, as well as that of annuity, there shall be
taken into account the probable life of the beneficiary in
accordance with the latest Basic Standard Mortality Table
approved by the Secretary of Finance, upon
recommendation of the Insurance Commissioner.
 ESTATE TAX
Assessments and Valuations

► The book value based on the latest audited financial

statement of the company is presumed to be the fair
market value of the shares of stock of a domestic
company for estate tax purposes.

► For shares that are listed and traded in the stock

exchange, the market price nearest to the date of death is
considered the fair market value of the listed shares.
CASES

1 January 2014
Presentation title
PNB vs. Santos, et al. G.R. No. 208293 / Lina Aguilar vs.
Santos, et al. GR No. 208295, December 10, 2014

Facts:
Mr. Angel C. Santos died on March 21, 1991 and left a bank
account in PNB. His children, respondents in this case, presented
the necessary documents to PNB in order to withdraw their
father’s deposit, as follows: 1) Mr. Santos’s Death Certificate; 2)
BIR-issued Certificate of Payment / Exemption from Estate Tax; 3)
Deed of Extrajudicial Settlement; 4) Publisher’s Affidavit; and 5)
Surety Bond.
However, PNB (thru Bank Manager Lina B. Aguilar) informed the
respondents that the deposit had already been released to Mr.
Bernardito Manimbo, who on the other hand, presented the
required documents to PNB sans the BIR-issued Certificate of
Payment/Exemption from Estate Tax.
PNB vs. Santos, et al. (continued..)

Issue:
Was PNB negligent in releasing the deposit to Mr. Manimbo in the
absence of the BIR-issued Certificate of Payment / Exemption
from Estate Tax.
Ruling:
Yes. Section 118 of PD 1158 (now Section 97 of the 1997 Tax
Code) mandates that the bank shall not allow any withdrawal from
the deceased’s deposit account unless the BIR Commissioner has
certified that the taxes imposed thereon have been paid. The
Certificate of Payment/Exemption from Estate Tax is a legal
requirement before the deposit of a decedent is released. The
requirement is based on the assumption that only those with
sufficient and valid claim to the deposit will pay the taxes for it and
that requiring the certificate from the BIR increases the chance
that the deposit will be released only to them.
 Rafael Arsenio S. Dizon in his capacity as Judicial
Administrator of the Estate of the deceased Jose P.
Fernandez vs. CTA and CIR, G.R. No. 140944 (April 30, 2008)

Facts:
The BIR assessed the estate of Jose Fernandez for
deficiency estate tax.
The courts ruled that the claims of creditors should not be
allowed in full as deductions in computing the estate tax
liability because the actual payments made by the estate to
the creditors were lower than the claims due to compromise
agreements subsequently entered into by the estate.
Issue:
Can the actual claims of the estate creditors be fully allowed
as deductions from the gross estate despite the fact that the
claims were subsequently reduced or condoned?
Rafael Arsenio S. Dizon (continued…)

Ruling:
Yes. The deductible amount for a claim against the estate is
fixed as of the decedent’s death. Where a lien claimed
against the estate was certain and enforceable on the date
of the decedent’s death, the fact that the creditor
subsequently settled for a lesser amount does not prevent
the estate from deducting the entire amount of the claim for
estate tax purposes.
Estate tax is a tax on the act of transferring property by will
or intestacy. As the tax is levied at a fixed time, which is
upon death, the net value of the property transferred should
be ascertained, as nearly as possible, as of that time.
Rafael Arsenio S. Dizon (continued..)

There is nothing in our tax laws which disregards the date-

of-death valuation principle and which considers post-death
developments in determining the net value of the estate.
Furthermore, the term “claims” under our Rules on Special
Proceedings is generally construed to mean debts or
demands of a pecuniary nature which could have been
enforced against the deceased in his lifetime or a liability
contracted by the deceased before his death. Therefore, the
claims existing at the time of death should be made the
basis in determining allowable deductions against the gross
estate.
Estate of Fidel F. Reyes and Estate of Teresita R. Reyes
vs. CIR, CTA Case No. 6747, January 16, 2006
Facts:
Spouses Fidel F. Reyes and Teresita R. Reyes died on
January 23, 1997 and August 24, 1998, respectively, leaving
various properties to their legal heirs.
On December 29, 1997 and February 24, 1999, estate tax
returns were filed for the estates of Fidel F. Reyes and
Teresita R. Reyes, respectively.
On November 29, 2002, Respondent CIR assessed
Petitioners for deficiency estate tax, among others.
Petitioners included a vanishing deduction in computing the
estate of Teresita Reyes.
Estate of Fidel F. Reyes (continued…)

Petitioners protested the assessments for deficiency estate

tax for having been issued beyond the 3-year period to
assess and collect taxes, and that the 10-year prescriptive
period does not apply because the returns are devoid of any
falsity or fraudulent intention to evade taxes. They argued
that there was merely a mistake in the valuation and
classification of the properties of Fidel Reyes for estate tax
purposes. There was also just a miscalculation of the
vanishing deductions in the estate tax return of Teresita
Reyes. Moreover, Petitioners maintained that the phrase
“intention to evade taxes” under Section 222 (a) of the Tax
Code refers to both false and fraudulent return.
Estate of Fidel F. Reyes (continued…)

Issues:
► Should ‘intent to evade taxes’ exist in the case of false
returns for purposes of applying the 10-year prescriptive
period to assess?
► Did petitioners correctly compute the amount of vanishing
deduction from the estate of Teresita Reyes?
Estate of Fidel F. Reyes (continued…)

Ruling:
1. No. The Supreme Court already made a distinction
between “false” and “fraudulent” returns in the case of Aznar
vs. Court of Tax Appeals. Intent to evade taxes need not be
present in a false return for purposes of the 10-year
prescriptive period to assess. Otherwise, there will be no
distinction between false and fraudulent returns and the law
would not have provided for the distinct situations.
Thus, although there are no indicia of fraud in this case, the
Court found the returns to be false in view of the substantial
underdeclaration of properties and overstatement of
vanishing deductions in the estates of Fidel F. Reyes and
Teresita R. Reyes, respectively.
Estate of Fidel F. Reyes (continued…)

2. No.
The “initial basis” (or property previously taxed) used by
petitioners in computing for the vanishing deduction is 13/24
of the gross estate of Fidel F. Reyes (Fidel had 12 heirs – 11
children and Teresita, as surviving spouse), whereby
petitioners added ½ of the conjugal property which belongs
to Teresita (or 12/24) and 1/24 which is Teresita’s inheritance
share from Fidel.
The “initial basis” should instead be 1/24 only, which is the
inheritance share of Teresita R. Reyes in Fidel Reyes’s gross
estate.
People of the Phils. Luz A. Santos and Ricardo A. Santos
C.T.A. Crim. Case No. O-246, May 20, 2015

Facts:
A case was filed against Luz and Ricardo A. Santos, legal
heirs of Iluminada a. Santos, for violation of Section 255 of
the 1997 NIRC for failure to file an Estate Tax Return and
failure to pay the related Estate Tax, by use of a falsified
Deed of Transfer of real property and other documents.
People of the Phils. (continued…)

The prosecution alleged that:

(1) the accused heirs of Iluminada are the persons required
under Sections 90(B) & 91 of the 1997 NIRC or by rules and
regulations to file an Estate Tax Return & pay the tax due;
(2) the Deed of Transfer was executed by the accused in order
to avoid the payment of Estate Tax, which is within six (6)
months from the death of the decedent;
(3) the accused presented falsified Certificate Authorizing
Registration and Tax Clearance Certificate to effect the
transfer of the properties without payment of the required
taxes; and
(4) the accused Ricardo cannot claim the defense of tax
amnesty as he failed to prove his availment thereof.
People of the Phils. (continued…)

Issue:
Is Ricardo guilty of violation of Section 255 of the NIRC?

Ruling:
No. The prosecution failed to prove all the three elements of
the offense beyond reasonable doubt, as follows:
► The accused is a person required to make or file a return and/or pay
the tax;
► The accused failed to make or file the return and/or pay the tax at the
time required by law; and
► Failure to make or file the return and/or pay the tax, was willful.
People of the Phils. (continued…)

First element: Ricardo is the person required to make or

file a return and/or pay the tax.

The Tax Code provides that six (6) months after the death of
the decedent, it is the duty of the executor, the administrator,
or the heirs of the decedent to file the Estate Tax Return. It is
also the duty of the said executor, administrator, or heir/s to
pay the Estate Tax at the time the return is filed. In the
present case, no one was appointed as executor or
administrator. Therefore, the responsibility lies upon the heirs
to file the return and pay the tax. As an heir, Ricardo is duty
bound to make or file a return and/or pay the tax.
►
People of the Phils. (continued…)

Second element: Ricardo failed to make or file the return

and/or pay the tax at the time required by law.
Records reveal that no Estate Tax Return was executed by
the accused after the death of Iluminada. What was entered
into was a Deed of Transfer executed after the death of the
decedent and an undated Deed of Donation which was
acknowledged before a notary public also after the death of
the decedent.
People of the Phils. (continued…)

Based on Section 85 of the 1997 NIRC, the Gross Estate

includes all the properties of the decedent at the time of
his/her death and all the transfers of the decedent which
were made in contemplation of death. The lands covered by
the Deed of Transfer appears to be transferred after the
death of the decedent in 2003.
On the other hand, the properties in the Deed of Donation
(Mortis Causa) were transferred in contemplation of death.
Clearly, all the properties transferred via Deed of Transfer
and Deed of Donation are part of the Gross Estate and
included in the computation of Estate Tax and Ricardo
should have executed an Estate Tax Return and paid the
corresponding tax due thereon, but this he failed to do.
People of the Phils. (continued…)

Third element: The failure to make or file the return and/or

pay the tax, was not sufficiently proved to be willful on the
part of Ricardo.
The Court found insufficient proof that Ricardo willfully failed
to pay the tax and make a return. The prosecution relied
solely on the date of execution provided on the face of the
Deed of Transfer. Records reveal that the Deed of Transfer
was executed approximately seven (7) months after the
death of Iluminada. However, based on the immigration
stamps on Ricardo’s Passport, he was not in the Philippines
when the same was executed.
People of the Phils. (continued…)

Improperly notarized documents do not enjoy the

presumption of due execution and authenticity.
Presumptions that attach to notarized documents can be
affirmed only so long as it is beyond dispute that the
notarization was regular. Therefore, the fact that a deed is
notarized is not a guarantee of the validity of its contents and
the presumption of regularity may be rebutted by clear and
convincing evidence to the contrary.
People of the Phils. (continued…)

No other evidence was presented by the prosecution to link

Ricardo to the execution of the Deed of Transfer. Ricardo
could not have possibly participated in the execution of the
Deed of Transfer that allegedly facilitated the issuance of
CAR 2003 00053255 and TCC OCN 3TA0000173143, which
led to the ultimate transfer of ownership over the subject
properties. Since the prosecution failed to prove the
connection between accused Ricardo A. Santos and the
execution of the documents above-stated, it cannot be said
that his failure to file the return and pay the tax were, in fact,
willful.
Thank you!