How a Foreigner can receive his Philippine Land Inheritance (Updated for 2018 TRAIN Law)
Yes, a foreigner can inherit Philippine assets (with some restrictions).
If you are a foreign heir to a Philippine land inheritance, this post is particularly for you.
This post answers common questions as to whether you can inherit, how much you can inherit and the process and payments to put the title in another person’s name (this is needed when you sell the property).
It also goes through a common real life example of a person who died without a will, but left behind:
- a family home;
- a bank account;
- unpaid real estate taxes.
A few notes:
Be prepared to work with your co-heirs (otherwise the process becomes considerably more difficult) and to pay taxes due on the estate.
Also, be prepared to go to a number of government offices in person to coordinate. Most things still cannot be done through the phone or the internet.
Contents
- Can you inherit Philippine Land as a foreigner?
- How much can you inherit as a foreigner?
- How do you transfer the Philippine property to your name?
- Will I have to pay to settle the estate?
- How much will I have to pay to settle the estate?
- How much would I pay to settle the estate if the only assets are the family home and a bank account?
- Summary
Can you inherit Philippine Land as a foreigner?
Yes, you can inherit land in the Philippines if the person you inherited from died without a will.
However, you cannot inherit Philippine land if the person you inherited from died with a will.
The law is very firm on this.
In fact, inheriting intestate (inheriting when there is no will) is the only way that a foreigner can own land in the Philippines.
A foreigner can inherit land if the deceased had no will.
A foreigner cannot ordinarily own Philippine land at all, with the exception of former Filipino citizens who can purchase restricted quantities of land.
This post deals specifically with the case of a foreigner who inherited Philippine land from a Filipino when the deceased Filipino died without a will.
How much can you inherit as a foreigner?
You inherit a set portion of an estate when you inherit without a will.
The amount you inherit is set down by Philippine law.
The amount cannot be changed unless the other heirs agree.
Your portion will depend on who else are heirs according to the law.
Usually, an estate is divided among relatives. Spouses and children are prioritized.
If your father and your mother had children, grandparents, parents and siblings do not usually inherit. If your parents had no children, then they stand to inherit.
There is an entire table on this and it is quite detailed.
How do you transfer the Philippine property to your name?
Now that you know you are an heir, your number one question is likely how you can transfer the title of these properties to yourself or an interested buyer.
Many new owners will want the title in their name since this ensures that their ownership is not challenged. If the title is in another’s name, that person or his heirs can claim it.
You can only do this through a process called “settling the estate”.
There are 7 steps to settling an estate.
Settling the estate means paying estate tax to the BIR, any unpaid real estate taxes, and debts, and then agreeing with your co-heirs on the estate details. Only then can you transfer property to another.
It has several steps:
- Get the death certificate
- File BIR 1904
- Gather Estate Documents
- Reach an Agreement with your Co-Heirs
- Execute an Extrajudicial Settlement or applicable document
- File BIR 1801
- Pay Estate Tax and Get CAR
This is a pretty involved process, so you’ve really got to commit to spending time and money on it.
You’ll need someone to physically visit all the government offices.
Some common problems you may face if you are living abroad are:
- You may need to physically visit Philippine government offices to complete the process
- You have to agree with your co-heirs
- You have to have the money to pay for the debts and unpaid taxes
- You have to have any of the documents
You’ve really got to work with your co-heirs who are in the Philippines.
They will likely be able to find the documents and visit the government offices. Together, you can also decide how you are going to pay the estate’s obligations.
You’ve got to pay these obligations so that you can receive the BIR’s clearance.
This clearance is called the Certificate Authorizing Registration and will now allow you to sell or transfer the property.
Will I have to pay to settle the estate?
You will have to pay before being able to sell or transfer the property.
Why?
Well, the BIR will not allow you to transfer property to another person without you paying all previous debts or taxes which is called “settling the estate”. The Registry of Deeds also needs this BIR clearance to transfer to a new owner.
You might be tempted to postpone settling the estate.
Don’t!
It will end up costing you and your co-heirs more money.
Settling an estate can be a long process.
The BIR only gives you 1 year after a death to settle the estate. Afterwards, it will start to charge you penalties:
- 25% surcharge on the tax due if not paid on time
- 20% interest rate on the tax due
If it goes on long enough, the tax due can be too much to handle and can be more than your inheritance.
How much will I have to pay to settle the estate?
One of the first steps you’ll have to accomplish is to figure out what the estate owns and owes.
What the estate owns could be:
- Family home and other real estate
- Stocks and Bonds
- Vehicles and other Assets
What the estate owes could be:
- Debts
- Unpaid real estate taxes
- Other obligations
When you calculate the estate, you will need all the documents that show ownership.
At this point, you should also call an accountant or an estate lawyer.
Things can get complicated and they’d be able to figure out legal ways to lower your obligations or if foreign tax treaties apply to you.
How much would I pay to settle the estate if the only assets are the family home and a bank account?
A very common scenario is when the only asset of the estate is the family home.
You, your mother and your brother inherited equal shares in your father’s estate. Your mother and father’s property marriage regime is that of absolute community.
Your father’s estate is composed of a family home in Mandaluyong, a bank account and unpaid real estate taxes.
Let’s take a look at this case with the hard numbers:
Now, that’s the answer.
But how do you get there?
Below, you’ll find the most practical approach to calculating what to pay.
(Hint: Hire an accountant!) 🙂 But joking aside, you really need someone well-versed in tax to be able to help you calculate the amount you will need to pay.
You will most certainly need to get all the documents related to the property and then start accounting what the estate owns and owes.
This will help you figure out exactly how much is needed.
Professionals are often needed to settle an estate because it can get complicated.
A good accountant and lawyer is even more important when the estate is complicated.
They might know of tax treaties to help you avoid being taxed in the Philippines and in your country.
They might know of tax exemptions to lower your estate taxes.
The more information you give them, the more they will be able to save you money. It is important that you give them as much documentation as you can.
Summary
If you want to sell or transfer property to your name, you will have to get clearance called a Certificate Authorizing Registration from the BIR.
You cannot get this clearance without paying estate taxes and unpaid realty taxes. This is called settling the estate.
Settling the estate with the BIR involves:
- Agreeing with your co-heirs
- Gathering essential documents
- Finding the money to pay estate taxes and other obligations.
Settling the estate can be complicated and a good accountant and lawyer should be able to advice you on how to best save on estate taxes.
After you settle the estate, the property can then be successfully sold or transferred after registering with the Registry of Deeds.
My mother has dual citizenship in PI and US. She inherited property (house with retail below) in Kalibo.It is in her name only. She resides in US and makes trips to PI every two years. I am her only heir and am a US citizen only. She has a will in the US regarding only her property in the US, nothing regarding the property in the PI. Does that mean I cannot inherit the PI home? Thank you.
As her only heir, you can inherit the property. However, there are important considerations before proceeding. Since your mother holds dual citizenship, Philippine law applies to her property in Kalibo. Generally, foreigners are restricted from owning land in the Philippines. However, foreign heirs may inherit property from a Filipino parent, subject to certain conditions.
Because you mentioned that the property includes both a house and a rental space, this requires a thorough review of documents and eligibility with a lawyer. You also noted that your mother has a will covering only her U.S. property. In that case, Philippine law will govern how her property in the Philippines is transferred.
We recommend booking a consultation with us. If you are currently residing in the U.S., we can arrange an online consultation. The consultation fee is PHP 2,500 for 30 minutes. To schedule, please email us at admin@lawyerphilippines.org.
I’m a Canadian citizen married to a Filipino since 2017. She has no children no parents. I have 3 grown up in Canada.I have a Canadian will. What happens if we both passed away? Or my wife passed away before me. My wife owes our home. Please advise Thanks
This situation involves multiple layers of property, inheritance, and nationality law, so it can quickly become complex. The specific application to your case depends on details like how and when the property was acquired, how it’s titled, and whether you want your Canadian children to eventually benefit from it.
Is it possible for my cousin to transferred all of the 44 hectares of land without our signatures? Without any SPA?
He sold this land without telling anyone of us and saying he lost the documents.
And he forge the signature and bribe everyone in the municipal and Capitol of his town where he sold the land.
How can I pursue to take it back from him and make him responsible to to return what it belongs to us? Thx
No, it is absolutely impossible under Philippine law to legally transfer or sell registered land without the true owners’ signatures or a valid Special Power of Attorney (SPA). The forge Deed of Sale is considered void from the start, this means that the transfer has no legal effect. in this matter, what you can do is to consult a lawyer for proper guidance and secure your evidence to serve as proof.
“If your parents had no children, then they stand to inherit.” Something is not quite right here, Attys.
What this means that if you pass away and you have no children (descendants), the law dictates that the inheritance moves upward to the ascending line. Therefore, your parents stand to inherit from you. Apologies for the confusion.
Thank you for this write up on property in the Philippine. My siblings and I inherited our parents property in the Philippine. We all live in the united state but can’t travel back to the Phil. Our cousin there will help us sell the property for us. What do we have to give her as our documents for her to be able to settle and sell the property for us. We have our parents death certificate because they also was in the US. We also have there marriage certificate and title of there property. As heir but living here in the state. What do we send to our cousin to give to as proof that we are heirs to property other than us giving special power of attorney on our behalf to sell the property. We will send death certificates. Marriage certificate. The title to the property and power of attorney sign by all of us here done by a lawyer here in the State. Will she need anything else from us
You are off to a great start. Collecting the title, marriage certificate, and death certificates forms the structural bedrock of this process. However, because you and your siblings all live in the United States, there are a few additional, critical documents your cousin will strictly need to successfully clear the taxes at the Bureau of Internal Revenue (BIR) and sell the land. Before the property can be sold, it must first be legally transferred from your deceased parents’ names to you and your siblings. Because you are all agreeing to sell it, your cousin needs a document called a Deed of Extrajudicial Settlement of Estate with Absolute Sale. You mentioned having the Power of Attorney (SPA) and documents signed by a lawyer in the United States. A standard US notary public stamp is not legally recognized by the Philippine government. Because these documents are executed outside the Philippines, your SPA and the Deed of Extrajudicial Settlement (EJS) must undergo the Apostille process. Alongside the documents you already have, you must ship all the necessary documents required.
Dear atty, the only co-heir is that boy the grandmother/my mother in law named after me with Falcified ba Birth Certificate. She and her son and wife used my name as the biological mother who was ALLEGEDLY AIDED BY( MY MOTHER IN LAW’s BEST FRIEND ) quack midwife to deliver the baby out of my womb. DNA TEST WILL PROVE THEM WRONG 100,000,000 percent. I did niot get pregnant at age 52 in 2002, and I never signed a DOCUMENT Of ADOPTION IN FRONT OF A LAWYER AND DSWD. There was no such agreement that I will adopt that boy nor my husband. The in-laws just did it in secret by themselves . I have never met the boy when I went to their place in 2018. Instead they threatened me if I don’t sign a declaration that I do not wish to pursue to EVICT THEIR MEMBER OF THE FAMILY WHO BUILT HOUSES IN MY LAND. “HWAG KANG SIGASIGA DITO DAHIL KAYANGKAYA KA NILANG PATULOGIN”. So I signed that piece of paper they drafted for me. I think THEY WILL USE THAT BOY TO INHERIT EVERYTHING FROM MY HUSBAND/HIS UNCLE ONCE THEY MANAGED TO KILL ME. The boy’s BC says I have no ther children alive ONLY THIS ONE! I HAVE TWO SONS FROM PREVIOUS MARRIAGE WHO ARE WORRIED ABOUT ME TO FLY HOME AND CLAIM WHAT I BOUGHT NEVER MIND WHAT MY HUSBAND HAS THEY CAN KEEP IT! My Age in the boy’s BC says I am 35 but ACTUALLY 52, my middle name says P instead of S, and I was born in a different Baranggay not theirs. They have THREE DEAD ALREADY: my father in law, his other nephew and now him- they all went to sleep at night and never woke up the morning! His sister’s Restaurant in Dagupan burnt down to ashes. Then again where they moved to Umingan all into ashes. Isn’t it Bad Karma for All their Shemming plot to Slay me? They are Evils. They have poisoned me in 2018! I tried to get water to drink in the big blue tank they buy from mineral supplier but they told me that blue tank is not mineral water. They gave me a small water bottle which I drank because I was so thirsty. Then I have realised and thought: how come I easily had open the bottle when normally I had to ask someone to twist the top. Couple of hours later I was sick throwing up and liquid out of my nose and ears and toilet, it was horrible I thought I was going to die. The Lord must have saved me.
After reviewing your inquiry, could you please clarify your specific legal concern? Your situation involves several different moving parts, and we cannot provide a clear legal assessment without knowing your main objective.
How can I find out the name of the Attorney my family is useing in The Philippines. They have removed me from the inheritance because I had a stroke and now wont tell me anything.
Can I make them pay the court cost and force them to pay me the money I should receive the sale of my fathers lands.
Can I file a document lien on these lands.
Is it illegal for them to steel my i heritance?
No, it is not legal for them to steal your inheritance. Having a medical emergency like a stroke does not strip away your legal rights as a child. Under Philippine law, you are considered a compulsory heir, and your family cannot simply erase you from your father’s estate. To see who your family hired, but you can find their name by tracking down the legal documents they have filed. For the lien on the lands, you need to get the land title numbers (Transfer Certificate of Title or TCT numbers) for your father’s properties. If you don’t have them, you can request copies from the Registry of Deeds (RD) of the province/city where the land sits by providing your father’s full name and the location of the land.
Is a certifed copy of Transfer Certificate of Title in lieu of the original title, enough for the BIR to settle the estate? I really want to take advantage of the Estate Tax Amnesty that is due to expire in June 30, 2021.
Yes, a Certified True Copy (CTC) of the Transfer Certificate of Title (TCT) is legally sufficient for the Bureau of Internal Revenue (BIR). In fact, the BIR requires a fresh CTC issued by the Registry of Deeds (RD) rather than the original physical title, because a CTC ensures that the property’s records are updated and free of hidden or unrecorded transactions.