Personal accident insurance with age 68 ??

[hk blues]

57 minutes ago, OnMyWay said:

To clarify, what are specific "taxes due" on a bank account, are due upon death?  Back taxes?  Estate taxes?  Death tax?

I'm really no expert on this at all but from my understanding a bank account would be subject to Estate Taxes as would other assets.   If it was a sole account then 100% of the balance would be considered, if joint then only 50%.  

I'm not sure how back taxes would be relevant as I thought taxes were calculated at source albeit there may be a timing difference between the previous interest payment/tax deduction and the death so yes, there may be some taxes due on interest not yet paid.  As for Death Tax - isn't that just a layman's term for Estate Tax here? 

Of course, there will likely be allowance and non-taxable elements but I was just outlining the concept in response to Joey G's question. 

[OnMyWay]

1 hour ago, hk blues said:

bank account would be subject to Estate Taxes as would other assets

I did a bit of quick research.  I could not find anything that bank accounts are specifically included in the estate.  However, there was a reference that money taken from a bank account after death would have 6% withheld by the bank, which is the amount of the estate tax. 

Apparently the bank account of the deceased is frozen until the estate tax, 6% is paid.  A common problem is that heirs do not have the money to pay the estate tax.  It takes time to to determine the Net Estate after allowances, etc.

The basic allowance is p5 mil.  Family house up to p10 mil.  So, if the total estate was 20 mil and you have the max on those, 5 mil net estate would be taxable at 6%.  p300,000 due.

I did see something that said a bank can immediately transfer the money in a spousal joint account to the account of the surviving spouse.

There are some special rules for aliens, both resident and non-resident.  Only assets in PH would be subject to estate tax.  I'm curious if my long term lease would be considered part of the estate subject to estate tax.  We are both on the lease so if I die that lease passes automatically to my wife, according to SBMA.

OP, sorry for hijacking the topic.

[hk blues]

13 minutes ago, OnMyWay said:

Apparently the bank account of the deceased is frozen until the estate tax, 6% is paid.  A common problem is that heirs do not have the money to pay the estate tax.  It takes time to to determine the Net Estate after allowances, etc.

This is exactly what I was referring to. 

When I read up on this it seems the banks are able to release funds to pay taxes as per some arrangement with the BIR.