fbt de minimis

Means any good, service or other benefit furnished or granted in cash or in kind byan employer to an individual employee (exceptexceptexceptexcept rank and file) such as, but notlimited to, the following:

(1) Housing;(2) Expense account;(3) Vehicle of any kind;(4) Household personnel, such as maid, driver and others;(5) Interest on loan at less than market rate to the extent of the differencebetween the market rate and actual rate granted;(6) Membership fees, dues and other expenses borne by the employer for theemployee in social and athletic clubs or other similar organizations;(7) Expenses for foreign travel;(8) Holiday and vacation expenses;(9) Educational assistance to the employee or his dependents; and(10) Life or health insurance and other non-life insurance premiums or similaramounts in excess of what the law allows.

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Fringe Benefit (RR 3Fringe Benefit (RR 3Fringe Benefit (RR 3Fringe Benefit (RR 3----98)98)98)98)

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De De De De MinimisMinimisMinimisMinimis BenefitsBenefitsBenefitsBenefits

• Considers the monetized value of vacation and sick leave credits paid togovernment official employees as “de minimis” benefits

• Clarifies that all other benefits given by employers which are not includedin the enumeration of what are “de minimis benefits” shall not beconsidered “de minimis”, hence, shall be subject to income tax as well aswithholding tax on compensation income (or FBT for a non-rank & fileemployee RMC 20-2011).

• Issuance was published on March 18, 2001 and shall take effect 15 daysthereafter or on April 1, 2011.

RR. No. 5RR. No. 5RR. No. 5RR. No. 5----2011 dated March 16, 2011 2011 dated March 16, 2011 2011 dated March 16, 2011 2011 dated March 16, 2011

Amending RR Nos. 2Amending RR Nos. 2Amending RR Nos. 2Amending RR Nos. 2----98 and 398 and 398 and 398 and 3----98, as last amended by RR No. 598, as last amended by RR No. 598, as last amended by RR No. 598, as last amended by RR No. 5----2008, 2008, 2008, 2008, with with with with respect to “De respect to “De respect to “De respect to “De MinimisMinimisMinimisMinimis” benefits” benefits” benefits” benefits

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• Issuance was published on March 18, 2001 and shall take effect 15 daysthereafter or on April 1, 2011.

• Shall apply to all income earned starting the year 2011.

RR. No. 5RR. No. 5RR. No. 5RR. No. 5----2011 dated March 16, 2011 2011 dated March 16, 2011 2011 dated March 16, 2011 2011 dated March 16, 2011

Amending RR Nos. 2Amending RR Nos. 2Amending RR Nos. 2Amending RR Nos. 2----98 and 398 and 398 and 398 and 3----98, as last amended by RR No. 598, as last amended by RR No. 598, as last amended by RR No. 598, as last amended by RR No. 5----2008, 2008, 2008, 2008, with with with with respect to “De respect to “De respect to “De respect to “De MinimisMinimisMinimisMinimis” benefits” benefits” benefits” benefits

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RR 2-98 RR 3-98 RR 10-00 RR 5-08 RR 5-11Exempt from Fringe Benefit Tax (FBT)

Limited to facilities or privileges (such as entertainment, Christmas party and other cases similar thereto; medical and dental services; or the so-called courtesy discount on purchases)

Monetized unused vacation leave credits of employees not exceeding ten (10) days during the year;

Monetized unused vacation leave credits of private employees not exceeding ten (10) days during the year and the monetized value of leave credits paid to government officials and employees

Monetized unused vacation leave credits of private employees not exceeding ten (10) days during the year;

Monetized value of vacation and sick leave credits paid to government officials and employees;

REVISED LIST OF BENEFITSREVISED LIST OF BENEFITSREVISED LIST OF BENEFITSREVISED LIST OF BENEFITS

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RR 2-98 RR 3-98 RR 10-00 RR 5-08 RR 5-11Medical cash allowance to dependents of employees not exceeding P750 per semester or P125 per month;

Medical cash allowance to dependents of employees not exceeding P750 per semester or P125 per month;

Medical cash allowance to dependents of employees, not exceeding P750 per employee per semester or P125 per month;

Rice subsidy of P350 per month granted by an employer to his employees;

Rice subsidy of P1,000.00 or one (1) sack of 50kg. rice per month amounting to not more than P1,000.00

Rice subsidy of P1,500.00 or one (1) sack of 50kg. rice per month amounting to not more than P1,500.00

Rice subsidy of P1,500 or one (1) sack of 50kg. Rice per month amounting to not more than P1,500;

Uniforms given to employees by the employer

Uniform and clothing allowance not exceeding P3,000.00 per annum

Uniform and clothing allowance not exceeding P4,000.00 per annum

Uniform and clothing allowance not exceeding P5,000 per annum; (RR 8-2012)

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RR 2-98 RR 3-98 RR 10-00 RR 5-08 RR 5-11Medical benefits given to the employees by the employer;

Actual yearly medical benefits not exceeding P10,000.00 per annum

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 P10,000.00 per annum;

Laundry allowance of P150.00 per month;

Laundry allowance not exceeding P300.00 per month

Laundry allowance not exceeding P300.00 per month;

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RR 2-98 RR 3-98 RR 10-00 RR 5-08 RR 5-11Employee achievement awards, e.g. for length of service or safety achievement, which must be in the form of a tangible personal property other than cash or gift certificate, with an annual monetary value not exceeding one-half (1/2) month of the basic salary of the employee receiving the award under an established written plan which does not discriminate in favor of highly paid employees;

Employee achievement awards e.g. for length of service or safety achievement, which must be in the form of a tangible personal property other than cash or gift certificate, with an annual monetary value not exceeding P10,000.00 received by the employee under an established written plan which does not discriminate in favor of highly paid employees

Employees achievement awards, e.g. for length of service or safety achievement, 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 favor of highly paid employees;

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RR 2-98 RR 3-98 RR 10-00 RR 5-08 RR 5-11Christmas and major anniversary celebrations for employees and their guests;

Gifts given during Christmas and major anniversary celebrations not exceeding P5,000.00 per employee per annum

Gifts given during Christmas and major anniversary celebrations not exceeding P5,000.00 per employee per annum;

Daily meal allowance for overtime work not exceeding twenty five percent (25%) of the basic minimum wage

Daily meal allowance for overtime work and and and and night/graveyard night/graveyard night/graveyard night/graveyard shift not exceeding twenty-five percent (25%) of the basic minimum wage on a per region basis

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RR 2-98 RR 3-98 RR 10-00 RR 5-08 RR 5-11Company picnics and sports tournaments in the Philippines and are participated exclusively by employees;

Flowers, fruits, books or similar items given to employees under special circumstances, e.g. on account of illness, marriage, birth of a baby, etc.

Flowers, fruits, books, or similar items given to employees under special circumstances e.g. on account of illness, marriage, birth of a baby, etc.

-deleted-

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BenefitsBenefitsBenefitsBenefits Rank and FileRank and FileRank and FileRank and FileManagers and Managers and Managers and Managers and SupervisorsSupervisorsSupervisorsSupervisors

If included in the

De Minimis listTax-free Tax-free

If not in the list or amount is in excess of threshold & 30k ceiling

Part of gross income subject to income tax

Considered as Fringe Benefit subject to Fringe Benefit Tax payable by employer

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Revenue Regulations 8Revenue Regulations 8Revenue Regulations 8Revenue Regulations 8----2000200020002000

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• The amount of "de minimis' benefits conforming to theceiling herein prescribed shallshallshallshall notnotnotnot be considered indetermining the P30,000 ceiling of "other benefits" (ofsection 32(B)(7)(E) of the NIRC)

• However, if the employer pays more than the ceiling, theexcess shall be taxable to the employee receiving thebenefits only if such excess is beyond the P30,000.00ceiling.

• Any amount given by the employer as benefits to itsemployees, whether classified as de minimis benefits orfringe benefits, shall constitute as deductible expenseupon such employer.

• Only the mandatory/compulsory SSS, GSIS, PHIC and HDMF contributions of concerned employees are excluded from gross income

• Voluntary contributions in excess of what the law requires forms part of the gross income of the taxpayer and hence, is subject to income tax

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RMC No. 27RMC No. 27RMC No. 27RMC No. 27----2011201120112011

Revocation of BIR Ruling Nos. 002-99, DA-184-04, DA-569-04 and DA-087-06

• Only the mandatory/compulsory SSS, GSIS, PHIC and HDMF contributions of concerned employees are excluded from gross income

• Voluntary contributions in excess of what the law requires forms part of the gross income of the taxpayer and hence, is subject to income tax

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RMC No. 27RMC No. 27RMC No. 27RMC No. 27----2011201120112011

Revocation of BIR Ruling Nos. 002-99, DA-184-04, DA-569-04 and DA-087-06

Medical Allowance Without Actual Substantiation Not Considered “De Minimis" Benefits ( BIR RULING NO. 019-02)

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fbt de minimis

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