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Republic of the Philippines
Manila
106.7 million
Philippine Peso
.ph
+63
Philippine Peso
Net taxable income |
Tax on Lower Amount (PHP) |
Rate on Excess (%) |
|
Exceeding (PHP) |
Not Exceeding (PHP) |
||
0 |
250,000 |
0 |
0 |
250,000 |
400,000 |
0 |
20 |
400,000 |
800,000 |
30,000 |
25 |
800,000 |
2,000,000 |
130,000 |
30 |
2,000,000 |
8,000,000 |
490,000 |
32 |
8,000,000 |
- |
2,410,000 |
35 |
Effective from 1 January 2023, the following will be the graduated rates.
Net taxable income |
Tax on Lower Amount (PHP) |
Rate on Excess (%) |
|
Exceeding (PHP) |
Not Exceeding (PHP) |
||
0 |
250,000 |
0 |
0 |
250,000 |
400,000 |
0 |
15 |
400,000 |
800,000 |
22,500 |
20 |
800,000 |
2,000,000 |
102,500 |
25 |
2,000,000 |
8,000,000 |
402,500 |
30 |
8,000,000 |
- |
2,202,500 |
35 |
Deductible Expenses |
|
Employment Expenses |
|
Personal Deductions |
|
Business Deduction |
In lieu of these allowable deductions, an individual, other than a non-resident alien, may elect an optional standard deduction (OSD) not exceeding 40% of gross business or professional income |
Type of Visa/ permit |
Documentation |
Validity |
Eligibility |
Alien Employment Permit |
|
1 year (may be extended up to a maximum of 5 years) |
|
Temporary Work Permit |
|
3 months |
|
VAT |
|
Standard Rate |
12% |
Zero Rate |
0% |
WHT |
|
Dividends |
15%/ 30% |
Interest |
20% |
Royalties: - |
|
Nonresident |
30% |
Resident |
20% |
Technical Service |
30% |
Statutory Benefits |
Probationary Period |
Annual Leave |
Public Holidays |
Maternity Leave |
Paternity Leave |
Sick Leave |
Overtime Pay |
Notice Period |
Severance Pay |
13th Month Pay |
Social Security Benefits |
Christmas Bonus% |
Based on one month bonus (paid by the 24th of December) |
Christmas Bonus Over Vacations % |
0% |
Severance per Year % |
Employees are entitled to severance pay that equals one and a half months pay after one year of service (12.5% of annual salary) |
Vacations % | Employees are entitled to 5 days of annual leave (1.37% of annual salary) |
Notice % |
Employees are entitled to a 1 month of notice period for one year of service or more (8.33%) |
Christmas Bonus Over Notifications% | 0% |
Vacations Plus% | 0% |
Total percentage of Salary (yearly) | The total employment accruals as a percentage of salary per anum are equal to 26.36% |
Social Security max, matched by employer | 28,200.00 |
Maternity leave | 60days |
Christmas Bonus | 8.33% |
Vacations | 4.66% |
Description | The maximum annual social tax payable by a foreign national employee is PHP 28,200 for tax year 2021. Social taxes consist of contributions to the Social Security System (SSS) and Philippine Health Insurance Corporation (Philhealth). Foreign nationals who are working in the Philippines are no longer required to contribute to the Home Development Mutual Fund (HDMF). Employers are required to match the employees' contributions. employee in a foreign bank if no individual pension fund abroad is available.
|
Employment Accruals | ||
Service Incentive Leave | Philippine employees are legally entitled to 5 days of paid 'service incentive leave', which can be used for vacation or sick leave. | This equals 1.36% (5/365 days) of annual income |
Maternity Leave | All working mothers — including those employed in the informal sector — can take up to 105 days of paid maternity leave (up from 60 days for normal childbirth or 78 days for a cesarean delivery) for each pregnancy, provided they’ve made at least three monthly contributions to the Social Security System (SSS) in the 12 months preceding the semester of the birth and have notified their employer. | This equals 28.7% (105/365 days) of annual income |
Paternity Leave | Notwithstanding any law, rules and regulations to the contrary, every married male employee in the private and public sectors shall be entitled to a paternity leave of seven (7) days with full pay for the first four (4) deliveries of the legitimate spouse | This equals 1.9% (7/365 days) of annual income |
Severance | In case of termination due to the installation of labor saving devices or redundancy, the employee affected is entitled to a separation pay equivalent to at least his one (1) month pay or to at least one (1) month pay for every year of service, whichever is higher. | This equals 8.33% (1/12 months) of annual income |
Overtime | Overtime pay is an additional pay of 25% of a covered employee's hourly rate for work performed beyond eight (8) hours a day or for overtime work. | Depends on the number of overtime hours worked |
13th Month Pay | Under Presidential Decree No. 851, employers from the private sector in the Philippines are required to pay their rank-and-file employees a Thirteenth 13th Month Pay not later than December 24 every year. | This equals 8.33% (1/12 months) of annual income |
Social Security | The employer’s contribution is approximately 8% of employees’ salaries. | This equals 8% of annual income |