RMC No. 23-2026: Clarifying the Provisions of Revenue Regulations No. 13-2025, the Consolidated Provisions to Simplify and Streamline the Procedures and Requirements Relative to the Availment of the Tax Exemptions and Incentives Granted to the Participating Private Entities under Republic Act No. 8525 (Adopt-a-School Act of 1998), Republic Act No. 12063 (Enterprise-Based Education and Training (EBET) Framework Act), and the Tax Code

Key points

1. Who implements EBET. Only Enterprises registered with TESDA may implement an EBET Program. The term “Technical-Vocational Institutions” (TVI) in Section 4(A) of RR No. 13-2025 refers to such Enterprises, not to academic institutions under Section 27(B) of the Tax Code.
2. Additional deduction. The additional deduction is on top of regular deductions under Section 34 of the Tax Code. From the effectivity of the EBET Act until December 31, 2027, the deduction is 150% of actual training expense. From January 1, 2028 the additional deduction is seventy-five (75%), and it cannot exceed five percent (5%) of total direct labor expenses or twenty-five million pesos (P 25,000,000.00) a year, whichever is lower.
3. Which expenses count. Only training expenses actually incurred and shouldered by the Enterprise are deductible, not those paid by TESDA or other sponsors or donors. Training allowances for transportation, meals, or similar items count if the Enterprise directly incurred them, and an expense may be claimed once, under the general EBET program or the Training Support Fund. Transportation and meal allowances under an Upskilling Program may not be claimed as training expense.
4. Timing and audit. Deductions are claimed in the taxable year the expenses were paid or incurred, and unclaimed amounts are forfeited with no carry-over. TESDA sends the BIR a quarterly list of registered and de-registered implementers, and BIR post-audit is still required after a Certificate of EBET Implementation/Donation.
5. Mutually exclusive incentives. Under Section 6 of RR No. 13-2025, EBET and Adopt-a-School incentives are mutually exclusive and bar similar incentives under other laws. For an activity, an Enterprise may use only one incentive, under Section 3 or Section 4 of RR No. 13-2025.
6. Agreements with public schools. The Section 3 incentive still applies if the agreement directly benefits the public school, such as staff and faculty development, even when Enterprise personnel are added beneficiaries. The agreement must state how participants are split, and only expenses for public school staff get the additional deduction.

Who is affected

• Enterprises registered with TESDA implementing EBET Programs
• Private entities under the Adopt-a-School Act of 1998

Deadlines and effectivity

• 150% deduction: from EBET Act effectivity until December 31, 2027
• Additional deduction of 75%: starting January 1, 2028
• Issued: March 30, 2026