RMC No. 53-2011: Sets the effectivity and application of revocation of BIR Ruling Nos. 002-99, DA-184-04, DA-569-04 and DA-087-06 under RMC No. 27-2011 and amends certain phrases thereof

Key points

1. Covered contributions. Contributions under Section 32(B)(7)(f) of the NIRC of 1997 cover only the mandatory or compulsory contributions of employees to SSS, GSIS, PHIC and HDMF.
2. Voluntary contributions. Voluntary contributions in excess of the compulsory amount are not excludible from gross income, so they are not exempt from Income Tax and Withholding Tax.
3. Withholding tax exemption. The exemption from withholding tax on compensation under Section 2.78.1(B)(12) of RR No. 2-98 applies only to mandatory or compulsory GSIS, SSS, Medicare and Pag-ibig contributions.

Who is affected

• Employees and individuals contributing to SSS, GSIS, HDMF (Pag-ibig) and PHIC (Philhealth)

Deadlines and effectivity

• Taxability of voluntary contributions applies beginning July 1, 2011