De minimis Benefits

-exempt from income tax and FBT, withholding tax

-facilities furnished by the employer which are relatively small value
Promoting the health, efficiency , goodwill
-kind of fringe benefit
-income tax exemption is applied to all kinds of employee [mgr, sup, rank an file, etc]
-RR 11-2018: legal basis of de minimis benefits

-nature/ type [the list is exclusive]

1. Monetized unused vacation leave not exceeding of 10 days for private employees
2. Monetized vacation and sick leave credit for government employees
3. Rice subsidy of 2K, 1 sack of rice not exceeding 2K
4. Uniform/ clothing allowance not exceeding 6K
5. Laundry allowance not exceeding 300/ month
6. Medical cash allowance to dependents per employee not exceeding 1.5K per semester or
250 pesos/ month
7. Actual yearly medical benefits not exceeding 10K/ year
8. Gifts given during Xmas/ Major anniversary celebration not exceeding 5K/ employee
9. Benefits received by employee by virtue of CBA or Productivity incentive scheme 10K
10 Employee’s achievement Award [other than cash] not exceeding 10K under established under written
plan w/c does not discrimate with highle paid employees [in the form of tangible personal property]
11. daily meal allowance for OT work/ graveyard shift work which must not exceed 25% of basic
minimum wage

-exempt from income tax only to the extent to the ceiling amount prescribed by law.
Beyond 90K
-13 month pay, productivity incentive, Christmas bonus not exceeding 90K/ year

-tax exempt amount

Fringe Benefits- any goods, service, other benefits granted by employer cash/kind in addition to basic
salary to an individual employee
-Subject to Fringe Benefits Tax
-Section 33NIRC

Not subject to FBT

1. De minimis Benefit
2. Authorized and exempted from Income tax under NIRC or other special law
3. Contribution of employer for the benefit of employee for retirement plan, insuran
4. Benefits given to Rank and file
5. Required or necessary to the trade/ benefit of the employer
6. Convenience/ advantage of employer [convenience of the employer rule]- benefits for the
exclusive convenience
Subject to FBT [RR 3-98]
1. Benefits granted to supervisory/ managerial employees
2. Housing Privilege
3. Expense account- personal expenses shouldered by employer
4. Vehicle
5. Household expense
6. Interest loan interest rate< mkt rate
7. Membership fees, dues social and athletic clubs
8. Holiday vacation expenses
9. Foreign travel reasonable for purpose of business
10. Educational assistance
11. Insurance premium

Gross up monetary value= [Monetary Value]/ 65%

Fringe Benefits Tax= [Gross up monetary value] x 35%