The bemusement on the legality of joint bank account with a survivorship agreement
Date of Publication
5-2017
Document Type
Master's Thesis
Degree Name
Juris Doctor
Subject Categories
Banking and Finance Law
College
College of Law
Department/Unit
Law
Thesis Adviser
Avelino M. Sebastian Jr.
Defense Panel Member
Anuncacion G. Ayo
Julius M. Lotilla
Martin Ignacio D. Mijares
Abstract/Summary
The opening, maintenance and operation of a joint bank deposit account have numerous advantages. For married couples, it is convenient for both of them to deposit their earnings in a single bank account and allow either one of them to withdraw money to pay the family bills and expenses. It also helps spouses to keep track of their earnings and expenditures. For children and their parents, the joint account enables the children to draw funds for urgent expenses, whenever their parents are unable to do so. Mainly, joint bank deposit account espouses convenience and practicability to both account holders. In the Philippines, a significant problem arises when one of the joint bank account holders dies. Under paragraph 2, Section 97 of the National Internal Revenue Code (hereafter the “Tax Code”), depository banks are required to freeze a bank deposit account, either held alone or jointly with another, upon the knowledge of the death of the account holder or one of the joint account holders. The bank shall not allow any withdrawal of funds from the said bank deposit account, unless the Commissioner of the Bureau of Internal Revenues has certified that the estate tax imposed on the estate of the deceased account holder has been paid. The objective of this provision of law is to ensure the payment of the estate tax owing to the government by the estate of the deceased account holder. During their lifetimes, the joint bank deposit account holders are co-owners of the outstanding credit balance standing in their bank deposit account. Hence a portion of the account, or presumably half of it 1 , is owned by each of the joint bank deposit account holders. Accordingly, upon the death of either of them, presumably half of the outstanding credit balance standing in the joint bank deposit account forms part of the estate of the deceased account holder. Over this portion of the bank account, the government is entitled to collect an estate tax. The unintended consequence of the freeze order is the inconvenience caused to the surviving joint bank deposit account holder, who is temporarily deprived of his/her right to withdraw funds from the joint bank deposit account.
Abstract Format
html
Language
English
Format
Electronic
Accession Number
CDTG006985
Shelf Location
Archives, The learning Commons, 12F Henry Sy, Sr. Hall
Physical Description
1 computer disc, 4 3/4 in.
Keywords
Bank accounts—Law and legislation--Philippines; Presumptions (Law)
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Recommended Citation
Au, C. Y. (2017). The bemusement on the legality of joint bank account with a survivorship agreement. Retrieved from https://animorepository.dlsu.edu.ph/etd_masteral/7296
Embargo Period
10-14-2024
