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Chapter Law Content

Chapter 2 Estate and Gift Tax Calculation
Article 7
For the part of taxable estate or gift eligible for exclusion from tax base calculation according to Subparagraphs 1 to 3, Article 16 of the Act, the taxpayer shall, upon filing the estate tax declaration, submit a document of proof declaring the beneficiary’s consent to accept the estate or gift to the competent tax authority for issuance of an Estate Tax Exclusion Certificate.
For such transfers by estate or gift in the preceding paragraph, if the properties involved are immovables, the taxpayer’s failure to complete the property rights transfer registration within one (1) year of the date of issuance of the Estate Tax Exclusion Certificate; or if movables, the taxpayer’s failure to deliver to the beneficiary the estate or gift within three (3) months, estate tax shall be made due retroactively, unless under special circumstances where an extension request has been filed with the competent tax authority with an approval granted.
The estate tax referred to in the preceding paragraph shall be charged the daily interest accrued on the amount of such supplementary tax at the interest rate based on the fixed interest rate on January 1 of each year for a one-year time deposit of postal savings, for the period from the date following the original deadline for making the payment of such tax to the date said notice was issued demanding supplementary payment of tax; for cases originally approved of duty exemption, interest shall be accrued from the next date of exclusion from gross estate certificate issued by the competent tax authority.
Article 8
(Deleted)
Article 9
For transfer of books or other publications already declared and registered under Subparagraph 4, Article 16 of the Act, the estate tax in arrears, if any, shall be paid in full to the competent taxation authority before such transfer can be made.
For such registered books or other publications as set forth in the preceding paragraph, the competent taxation authority shall establish a register and may take photographs for recordation if necessary.
Article 9-1
The failure to collect debt or exercise other rights of claim that has been verified by proof as referred to under Subparagraph 13, Article 16 of the Act shall refer to the following:
1. Where a debtor has been judged bankrupt or made a composition according to the Bankruptcy Act or undergone rehabilitation and liquidation according to the Consumer Debt Clearance Act or has filed for reorganization according to the Company Act, thereby resulting in creditors’ failure to fully reclaim all or part of the debt, and where a composition agreement or a court ruling has been secured.
2. Where the decedent or the heir and the debtor have jointly reached a litigious settlement or conciliation in court, thereby resulting in creditor’s failure to fully reclaim all or part of the debt, and where the court depositions regarding said settlement or conciliation have been obtained with the absence of matters specified under Subparagraph 1, Article 5 of the Act confirmed true by the taxation authority.
3. Where other reasons have caused failure to collect or exercise all or part of the debt or other rights of claim with relevant documents of proof submitted and confirmed true by the taxation authority.
Article 10
(Deleted)
Article 10-1
For the year gap to turning the age of majority as referred to under Subparagraph 2 and Subparagraph 5, Paragraph 1, Article 17 of the Act, a gap or a year difference less than one (1) year shall be calculated as one (1) year.
Article 10-2
For filing an application for the disabled and mentally retarded tax deduction pursuant to Subparagraph 4, Paragraph 1, Article 17 of the Act, a copy of the handbook for the severely disabled and mentally retarded specified or other such recognized proof issued by the relevant government organization, or a copy of a medical diagnosis issued by a specialist physician as required in Paragraph 1, Article 19 of the Mental Health Act shall be attached.
Article 10-3
Dependent siblings or grandparents as set forth under Subparagraph 5, Paragraph 1 of Article 17 of the Act shall refer to the following:
1. The decedent’s siblings under the age of majority; or above the age of majority remaining dependent due to school attendance, mental or physical disability, or inability to make a living on their own.
2. The decedent’s grandparents above the age of sixty (60); or under sixty (60) years of age yet dependent due to inability to make a living on their own.
Article 11
(Deleted)
Article 11-1
In case that the spouse of the decedent declares the right to claim for the distribution of the remaining property with the amount being approved as deduction from the gross amount of estate assets according to Paragraph 1 of Article 17-1 of the Act, and the taxpayer fails to pay the amount of the claim to the spouse of the decedent within the period provided by Paragraph 2 of the same Article, unless there is special reason approved by the tax authority to be postponed, the said taxpayer shall be levied estate tax according to the law.
The estate tax referred to in the preceding paragraph shall be charged the daily interest accrued on the amount of such supplementary tax at the interest rate based on the fixed interest rate on January 1 of each year for a one-year time deposit of postal savings, for the period from the date following the original deadline for making the payment of such tax to the date said notice was issued demanding supplementary payment of tax; for cases originally approved of duty exemption, interest shall be accrued from the next date of tax exemption certificate issued by the competent tax authority.
Article 12
(Deleted)
Article 13
In the event that the heir is unable to provide proof of the usage of any debt raised, property sold, or deposit withdrawn during the period when the decedent was unable to attend business or handle affairs on his own due to severe illness prior to his death, said borrowing, money received, or deposit shall be included in the calculation of the taxable estate.
Article 14
(Deleted)
Article 15
In the event that a military, police, or public service personnel died of duty related causes, his heir shall submit the Death on Duty Certificate issued by the institution where the decedent was employed to request for doubling tax exemption amount as specified in the second half of Paragraph 1, Article 18 of the Act.
Article 16
(Deleted)
Article 17
The dependents as set forth under Subparagraph 4, Paragraph 1 of Article 20 of the Act shall refer to any one of the following:
1. Superior lineal relatives of the donor or the donor's spouse above the age of sixty (60); or under sixty (60) years of age yet unable to make a living on their own and therefore dependent on the donor for livelihood support.
2. Inferior lineal relatives of the donor under the age of majority; or above the age of majority yet still attending school, or having a mental or physical disability, or unable to make a living on their own and therefore dependent on the donor for livelihood support.
3. Siblings of the donor under the age of majority; or above the age of majority yet still attending school, or having a mental or physical disability, or unable to make a living on their own and therefore dependent on the donor for livelihood support.
4. Other relatives or family members of the donor meeting the requirements set forth under Subparagraph 4 of Article 1114 and Paragraph 3 of Article 1123 of the Civil Act and are under the age of majority or above majority of age yet still attending school, or having a mental or physical disability, or unable to make a living on their own and actually dependent on the donor for livelihood support.
Article 18
The liabilities transferred together with the gift and deducted as specified under Article 21 of the Act shall be limited to properties with a value and such liabilities has been executed or where such execution can be guaranteed. Where said tax burden involves payment to persons other than the decedent that can be deemed as an indirect gift, no tax deduction claim can be filed.
The amount of tax deduction as set forth in the preceding paragraph shall not exceed the value of the share of taxable properties received.
Article 19
The deed tax and land value incremental tax paid from the transfer of immovable gifts may be deducted from the total taxable gifts.