When a person dies leaving properties, the heirs must go through a legal process to transfer ownership to their names. Extrajudicial settlement is the process used when there is no will and all heirs agree on how to divide the estate. This guide explains the requirements and steps.
What is Extrajudicial Settlement?
Extrajudicial settlement is a court-free process where heirs settle the estate of a deceased person through a notarized deed, without going to court. It applies only when all heirs are in agreement and the decedent died without a will (intestate).
Requirements
- Death certificate of the decedent
- Certificate of Non-Forum Shopping from the RTC
- Tax Clearance from the BIR (<em>e</em>CAR)
- Payment of estate tax (6% of net estate)
- Notarized Deed of Extrajudicial Settlement signed by all heirs
- Publication in a newspaper of general circulation (once a week for 3 consecutive weeks)
- Bond or surety (if required by law)
Step-by-Step Process
- Secure death certificate from PSA
- Gather all heirs and reach agreement on property division
- Draft and notarize the Deed of Extrajudicial Settlement
- Publish the deed in a newspaper of general circulation
- File estate tax return with BIR and pay estate tax
- Secure Certificate Authorizing Registration (CAR)
- Register with the Registry of Deeds to transfer titles
Estate Tax Rates (2026)
| Tax Type | Rate |
|---|---|
| Estate tax | 6% of net estate (over PHP 5M threshold may vary) |
| Capital Gains Tax (if property sold within settlement) | 6% |
| Documentary Stamp Tax | 1.5% |
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Disclaimer: This article is for general information only and is not legal advice. Consult a qualified lawyer for your specific situation.