RMC No. 91-2026: Clarification of the Base Amount for the Imposition of the Twenty Percent (20%) Penalty Relative to the Early Withdrawal of Personal Equity and Retirement Account (PERA) Assets, Accounts and Sub-Accounts Classified as Unqualified, and Amending Certain Provisions of Revenue Memorandum Circular (RMC) No. 4-2023

Key points

1. What the EWP consists of. Under Section 10(C) of RR No. 17-2011, as amended, the EWP is 20% of the Gross Income Earned attributable to the withdrawn PERA assets, from the opening of the account or sub-account to the date of withdrawal. It also includes recovery of any 5% tax credit previously availed of for those assets over the entire period.
2. Base amount. Only Gross Income Earned on assets actually withdrawn is included. Income that stays invested or held under PERA custody, including unrealized gains and sale or redemption proceeds that remain in PERA, is excluded. Losses in other PERA accounts or sub-accounts cannot be deducted.
3. EWP is a penalty, not a tax. The EWP is a statutory penalty for premature withdrawal. It is not a final withholding tax or an income tax on the amount withdrawn, and it is separate from the PERA tax exemptions under RA No. 9505.
4. Taxes that still apply. PERA exemptions cover only assets and income that remain within the PERA. Taxes expressly excluded from them continue to apply under the NIRC of 1997, as amended, including percentage taxes, Value-Added Tax, stock transaction tax and Documentary Stamp Tax.
5. Role of the PERA Administrator. The PERA Administrator administers the accounts, computes and withholds the EWP from the proceeds due to the contributor, and reports and remits it to the Bureau under RR No. 2-2022 and RMC No. 45-2022.

Who is affected

• PERA contributors with unqualified early withdrawals
• PERA Administrators

Deadlines and effectivity

• Issued August 11, 2026