RR No. 10-2016: Amends Section 10.C. of RR No. 17-2011, which implements the early withdrawal penalty of RA No. 9505 (Personal Equity and Retirement Account [PERA] Act of 2008)

Key points

1. Penalties for early withdrawal. For early withdrawals not covered by the circumstances in Section 10 (B) of RR No. 17-2011, the Contributor pays two penalties. One is the five percent (5%) tax credit availed for the entire period of the PERA. The other is a flat rate of twenty percent (20%) of the total income earned by the account from opening or creation up to withdrawal.
2. Disclosure. The administrator must fully disclose these penalties to the Contributor before the account is opened.

Who is affected

• PERA Contributors making early withdrawals
• PERA administrators