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July 08, 2008
REVENUE REGULATIONS NO. 10 - 2008
SUBJECT: Implementing Pertinent Provisions of Republic Act No. 9504, “An ActAmending Sections 22, 24, 34, 35, 51, and 79 of Republic Act No. 8424, asAmended, Otherwise Known as The National Internal Revenue Code” Relativeto the Withholding of Income Tax on Compensation and Other Concerns.TO : All Internal Revenue Officers and Others Concerned
Pursuant to Secs. 244 and 245 of the National Internal Revenue Code of 1997, as amended,in relation to the implementation of Republic Act No. 9504, amending Secs. 22, 24, 34, 35, 51 and79 of Republic Act No. 8424, as amended, these Regulations are hereby promulgated to amendSections 2.78.1(A), 2.78.1(B), 2.79 (A), (B), (F), (I), 2.79.1 and 2.79.2, 2.80, and 2.83 of RevenueRegulations No. 2-98 (RR 2-98), as amended, with respect to the withholding tax on compensationincome, increase of personal and additional exemptions, compensation received by minimum wageearners (MWEs) and other concerns.
. Section 2.78.1 of RR 2-98, as amended, is hereby further amended to read as follows:
Withholding of Income Tax on Compensation Income
(A) Compensation Income Defined
– xxx xxxxxx xxx xxx(3)
Facilities and privileges of relatively small value
. — Ordinarily,facilities and privileges (such as entertainment, medical services, or so-called"courtesy” discounts on purchases), otherwise known as
"de minimis benefits,"
furnished or offered by an employer to his employees, are not considered ascompensation subject to income tax and consequently to withholding tax, if suchfacilities or privileges are of relatively small value and are offered or furnished by theemployer merely as means of promoting the health, goodwill, contentment, orefficiency of his employees.