Basic monthly salary-net of sss,phic,pag-ibig (x 12 months) P xxx

Overtime pay or other supplementary compensation xxx

13th Month Pay and Other Benefits:

Thirteenth Month Pay P xxx

Other Benfits- transportation allowance xxx

Total P xxx

less: non-taxable 90,000.00 xxx

net taxable compensation Pxxx
If the employee’s other benefits are given for the
“Convenience of the employer” applies.

NOT a TAXABLE
compensation
• The 13th month pay and other benefits shall
not be taxable up to the amount of P90,000,
hence shall not be included in the gross
taxable income. Any amount in excess of
P90,000 shall be taxable.
Mr. Tuazon received the following compensation in the
month of December 2019.

Basic monthly salary 60,000.00

Overtime pay for November 10,000.00
Thirteenth Month Pay 60,000.00
Other Benefits-Annual transportation
allowance 50,000.00

How much is the taxable income for the year?

Basic monthly salary-net of sss,phic,pag-ibig (x 12 months) P xxx
Overtime pay or other supplementary compensation xxx

Thirteenth Month Pay xxx

Other Benfits- transportation allowance xxx

Total xxx

less: non-taxable 90,000.00 xxx

net taxable compensation Pxxx
Basic monthly salary (60,000 x 12) 720,000.00
Overtime pay or other supplementary
compensation 10,000.00
Thirteenth Month Pay 60,000.00

Other Benfits- transportation allowance 50,000.00

Total 110,000.00

less: non-taxable 90,000.00 20,000

net taxable compensation 750,000.00
 WEEK 7 TOPICS:
 DE MINIMIS BENEFITS
FRINGE BENEFFITS

2022-3-9
 you should be able to:
• apply legal provisions in computing taxable
income considering de minimis benefits

2022-3-9
 Check this!

• What is the difference between

“supplementary/additional compensation” and
“other benefits”?
• Why do we need to distinguish
supplementary/additional compensation from
other benefits?
• It is a “supplementary or additional
compensation” if it is a performance-based
remunerations to an employee in addition to
the regular compensation with or without
regard to the payroll period, otherwise, it is
“other benefits”.
• The 13th month pay and other benefits shall
not be taxable up to the amount of P90,000.
Any amount in excess of P90,000 shall be
taxable, hence shall be included in the gross
taxable income.
 De minimis benefits
•Specific privileges/benefits provided by law
which are of relatively small value
•With its own specific ceiling amount provided
by the law
• In excess of the ceiling, consider as "other
benefits" (along with the others) subject to
P90,000 ceiling

12
 List of De Minimis Benefits

• Monetized unused vacation leave credits 10 days maximum. (check differnce

between private and public employees--VL &SL)
• Medical allowance of 1,500 per semester or P250 pe month
• Rice subsidy of 24,000 annual or P2,000 per month
• Uniforms and clothing of 6,000 annual
• Medical benefits of 10,000 annual
• Laundry allowance of 3,600 annual
• Employees achievement award of 10,000 annual
• Gifts, xmas bonus, anniversaries of 5,000 annual
• Flowers, fruit, book
• Daily meal allowance of 25% of basic pay
• Benefits received by employees by virtue of collective bargaining agreement
• Laundry allowance of 3,600 annual
• Employees achievement award of 10,000 annual
• Gifts, xmas bonus, anniversaries of 5,000 annual
• Flowers, fruit, book
• Daily meal allowance of 25% of basic pay
BASIC PAY XXX
PERFORMANCE BONUS XXX
OVERTIME PAY XXX
13TH MONTH AND OTHER BENEFITS
13TH MONTH PAY XXX
14TH MONTH PAY XXX
GROCERY ALLOWANCE XXX
RICE ALLOWANCE( IN EXCESS OF DEMINIMIS AMOUNT) XXX
TOTAL xxx
NON-TAXABLE LIMIT 90,000 XXX
TOTAL TAXABLE INCOME XXX

2022-3-9
 Any " other benefits" not incluced in the list of
de minimis will be added to the 13th month
pay in full amount and be subject to P90,000
non-taxable limit

2022-3-9
 EXEMPT BENEFITS OF MINIMUM WAGE EARNERS

• Basic minimum wage

• Holiday Pay
• Overtime Pay
• Night Shift Differential Pay
• Hazard Pay

subject to the condition that an MWE must not have other items of taxable
income aside from these employee benefits
effect: along with the regular compensation/ salary,these will not be subject
to tax

2022-3-9
 Alexander, a private employee who is paid a P600 daily rate, receives the
following benefits during the year:

Monetized unused vacation leave credits 9 days

Monetized unused sick leave credits 9 days

Medical assistance P 7,000
Rice subsidy ( P2,500 per month) 30,000
Clothing allowance 8,000
Laundry allowance 6,000

Required: determine the amount to be included in "other benefits".

2022-3-9
 Problem 2
Giovannie, a government rank and file employee, received the following
benefits:

Monetized unused vacation leave credits ( 10 days) 6,000

Monetized unused sick leave credits ( 15 days)

9,000
Uniform allowance
5,000
Laundry allowance
4,800

Required: determine the amount to be included in "other benefits".

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2022-3-9