Name: ____________Grade & Section: Grade XI - _____

Subject: Business Mathematics Teacher: ___Score:

Lesson: Quarter 2 Week 4 LAS 1

Activity Title: Wage Earners with Benefits!!!
Learning Target(s): Define each of the benefits given to wage earners
Reference(s): SLM Business Mathematics
LAS Writer: DARLENE C. MARTIN
Content Validator/s:
Benefit
Benefit is a payment or gift made by an employer, the state, or insurance company.

De Minimis Benefits
These are facilities and privileges of relatively small value provided by an employer to the
employees merely as means to promote their health, goodwill, contentment or efficiency. It is also tax
exempt.

Take Note of This:

Employers are not obliged to give this kind of benefits but they are encouraged to do since
these benefits, no matter how small, are a big help to the workers.

What Benefits are considered de minimis benefits?

1. Monetized unused vacation leave credits of private employees not exceeding ten (10) days during
the year.
Payment of monetized unused “vacation” leave credits exceeding ten (10) days as well as
payment of “sick” leave regardless of number of days shall be added to other benefits with a 90, 000
ceiling. Any amount exceeding 90, 000 shall be subject to creditable withholding tax.
2. Monetized value of vacation and sick leave credits paid to government officials and employees.
3. Medical cash allowance to dependents of employees not exceeding P500 per employee per
semester of 250 per month;
4. Rice subsidy of P2, 000 or one (1) sack of 50 kg rice per month amounting to not more than
P2,000.00;
5. Uniform and Clothing allowance not exceeding P6, 000 per annum;

6. Actual medical assistance, e.g. medical allowance to cover medical and healthcare needs, annual
medical/executive check – up, maternity assistance and routine consultations, not exceeding
P10, 000 per annum;
7. Laundry allowance not exceeding P300 per month;

8. Employees achievement awards, e.g. for length of service or safety management, which must be in
the form of a tangible personal property other than cash or gift certificate, with an annual
monetary value not exceeding P10, 000 received by the employee under an established written
plan which does not discriminate in favour of highly paid employees.

9. Gifts given during Christmas and major anniversary celebrations not exceeding P5, 000 per
employee per annum;
10. Daily meal allowance for overtime work and night/graveyard shift not exceeding 25% of the basic
minimum wage on a per region basis;
11. Benefits received by an employee by virtue of a collective bargaining agreement (CBA) and
productivity incentive schemes provided that the total monetary value received from both CBA and
productivity incentive schemes combined do not exceed P10, 000 per employee per taxable year.
The foregoing list of de minimis benefits are “all incentive”. Meaning, all other benefits given by
employers which are not be considered de minimis benefits. ( RR – 8 - 2012; RR – 1 – 2015)
Example:
Mr. Daniel Santos received the following compensation and benefits during the year while working as
a bookkeeper.
Annual basic salary P 250, 000
th
13 month pay 48, 000
Rice subsidy 3, 000
Uniform Allowance 8, 000
How much money are taxable and non-taxable during the year?
Solutions:
Taxable Nontaxable
Basic salary P 250, 000
13th month pay 48, 000
Rice subsidy
3, 000 x 12 = 36, 000
Excess = 12, 000 24, 000
Uniform Allowance
8,000 6, 000
Excess = 2, 000
250, 000 78, 000
Excess: 2, 000 Excess: 12, 000
P 252, 000 P 90, 000

Mandatory Employee Benefits and Contributions in the Philippines

Social Security System (SSS): the SSS was created to provide private employees and their families
protection against disability, sickness, old age, and death.

Government Service Insurance System (GSIS): It is the equivalent system for Philippine
government employees.

Home Development Mutual Fund (HDMF) – also known as Pag – IBIG Fund, is a provident savings
system supplying housing loans to private and Philippine government employees, and to self-
employed persons who elect to join the Fund.

Philippine Health Insurance Corporation (PhilHealth): It is administered by the Philippine Health

Insurance Corporation, and provides employees with a practical means of paying for adequate
medical care in the Philippines.

Withholding Tax: It is the amount that an employer withholds from an employee’s wages and pays
directly to the government. The amount withheld is a credit against the income taxes the employee
must pay during the year. Basic salary below P20, 833 are non-taxable.

2020 PHILIPPINE BENEFITS

Holidays: Eleven (11) paid national regular holidays nine(9) national special holidays per year.
Vacation: Thirteen vacation leave, with additional one(1) day every year starting on the third year of
service and convertible to cash at the end of each year. Maximum vacation leave is 18 days.
Retirement: The plan is 100% funded by the company calculated at one month’s base salary per year
of service based on the employee’s latest basic rate upon normal retirement at age 60.

R = Retirement
R = 22.5 x DR x T DR = is the daily rate
T = is the number
of years served

Healthcare: The plan provides a comprehensive health care coverage for employees and eligible
dependents through Medicard’s accredited hospitals and doctors nationwide.

Sick Leave: Twelve (12) days for the first two years of service and additional one(1) day for every
year starting on the 3rd year. Maximum total sick leave is 15 days. All unused leave are convertible to
cash at the end of the year.

Bereavement Leave: Three (3) days applicable to immediate family member which includes the
employee’s children, parents, grandparents, brother, sister, spouse, and parents-in-law.

Solo Parent Leave: Seven (7) working days.

Calamity Leave: Two (2) days leave for employees who were affected by flood, fire, typhoon ( must
be supported by a government proclamation or may declared by the company).

Unemployment Compensation: It is a benefit paid to people who have recently lost their job via no
fault of their own ( laid off, the business closed, etc.)

Expanded Maternity Leave: It is an increasing the maternity leave period to one hundred and
five(105) days for female workers with pay.

Paternity Leave: All married male employees are eligible for seven(7) working days up to four (4)
child birth including miscarriage of legitimate spouse to be availed within (60) days from
delivery/miscarriage.

Magna Carta for Women (Special Leave): Sixty (60) calendar days leave. This is given to all female
employees who underwent surgery caused by gynaecological disorders and who have rendered at
least six(6) months continuous aggregate employment service for the last twelve(12) months prior to
surgery.

13th Month: The company grants a 13th month pay equivalent to one(1) month’s pay to all eligible
employees provided that they worked for at least one(1) month during a calendar year. The 13 th
month pay is due at the end of June.

Loyalty Token: Employees are recognized for their loyal and dedicated service to the company for
every 5 years of continuous service by the way of gift check or token, plus a plaque of appreciation
during the service award ceremony.

Dualing High School

Business Mathematics
XI – ABM
Name:________________________________________________Score:___________________
TEST I. Indicate whether the item is taxable or nontaxable
________________1.Emergency and hazard pay of MIU (Men in Uniform)
________________2.Gains from redemption of shares in mutual fund
________________3.Prizes and awards – Magsaysay awards
________________4.GSIS Retirement benefits
________________5.Premium received from insurance
________________6.Proceeds from life insurance of employee received by the employer
________________7.Gains from the sale of bond with a maturity of four years
________________8.Gains from the sale of certificate of indebtedness with a maturity of six years
________________9.Stock received due to professional service rendered
_______________10.Accumulated vacation leave for private employees converted into cash at the end
of employment contract
_______________11.Pensions, in general
_______________12.Proceeds from the sale of land(capital asset), P100,000:costs, P120,000
_______________13.Interest income
_______________14.Board of director’s fee
_______________15.Retirement program approved by the BIR
_______________16.Professional athlete’s salary
_______________17.Winnings from sweepstakes or Lotto
_______________18.Income derived from smuggling
_______________19.Interest received from life insurance
_______________20.De minimis clothing, P4,000.

Performance Task:
Can you name any famous (infamous) tax evaders in high profile cases who did not report all
of their taxable income and faced fines, imprisonment, or both? Give at least 10.

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Name: ____________Grade & Section: Grade XI - _____
Subject: Business Mathematics Teacher: ___Score:

Lesson: Quarter 2 Week 4 LAS 3

Activity Title:
Learning Target(s): Enumerate the standard deductions with the corresponding computation
Reference(s): SLM Business Mathematics
LAS Writer: DARLENE C. MARTIN
Content Validator/s: