Estate may be transferred in part before paying off estate tax by offering collateral
The National Taxation Bureau of Taipei, Ministry of Finance, has stated that taxpayers who are required to transfer the title of a property before paying off the tax due for special reasons (e.g., wishing to sell a part of the estate to pay off the tax) may apply to the National Taxation Bureau to furnish a guarantee. Upon approval, a consent to transfer said certificate can then be issued, allowing the taxpayer to dispose of a portion of the property in advance.
The Bureau explained that, as prescribed in Paragraph 1 of Article 41 of the Estate and Gift Tax Act, estate tax taxpayers who are required to transfer a part of the estate before paying off the tax may provide equivalent collateral as prescribed in Article 11-1 of the Tax Collection Act. Such collateral must be verified by the National Taxation Bureau to ensure it effectively secures the tax liability and does not affect the collection of the estate tax before the consent to transfer certificate can be issued.
The Bureau provided an example: Party A’s estate tax is assessed at NT$5 million, due by October 25, 2024. As Party A lacks sufficient funds to cover the tax and the heirs intend to sell shares of Company B (valued at NT$6 million) from the estate to pay the tax, the heirs offered a third-party fixed deposit of NT$5 million as collateral for the tax. With this collateral, they applied for and received the consent to transfer certificate, allowing them to proceed with the sale of the shares and settle the estate tax.
The Bureau would like to remind taxpayers that the due date for the estate tax cannot be extended due to the arrangements for collateral and disposal of the estate.Taxpayers must pay the tax on time to avoid late fees, interest, and administrative enforcement due to overdue payment.
(Contact person: Chief of Collection and Information Management Division Li, Tel: 2311-3711 Ext. 2140)
Reference URL：https://www.mof.gov.tw/Eng/singlehtml/f48d641f159a4866b1d31c0916fbcc71?cntId=cde49c6b73a4446683d7b97341534010