RR No. 15-2025: Revised Private Retirement Benefit Plan Regulations

Summary

RR No. 15-2025 prescribes the Revised Private Retirement Benefit Plan Regulations, covering tax incentives and qualification of BIR-approved retirement plans.

Key points

1. Incentives of a Tax Qualified Plan. Retirement benefits and trust income from investments under Section 60(b) are exempt from Income Tax and Withholding Tax, but stock transaction tax under Section 127(A) still applies to listed shares. Employer contributions are deductible under Section 34(J), either as Normal Cost or as excess spread equally over ten (10) consecutive years.
2. Requirements for retiring employees. The plan must be reasonable as determined by the Commissioner. The employee must have served the same employer for at least ten (10) years, be not less than fifty (50) years old at retirement, and not have previously availed of a retirement plan privilege. Service in a merger within a multi-employer plan is added up if no separation pay was received.
3. Reasonable plan conditions. The plan must be a written, permanent program covering at least seventy percent (70%) of employees (or 80% of eligible employees if eligibility rules apply), or a non-discriminatory classification. It also needs employer or employee contributions to a trust, no diversion of funds, no discrimination, non-forfeitable rights, and forfeitures used to reduce employer contributions.
4. Application. The employer applies to the BIR through the Legal and Legislative Division within thirty (30) days from effectivity of the plan for a certificate of qualification, valid until revoked. Documents differ for trusteed, non-trusteed or insured, and multi-employer plans, and amendments need their own certification.
5. Fees. For the certificate: ₱2,000.00 for employers with not more than fifty (50) employees, ₱3,000.00 for more than fifty (50) but not over one hundred (100), and ₱5,000.00 for more than one hundred (100). For an amendatory certificate: ₱2,000.00, ₱3,500.00 and ₱5,000.00 respectively, and employers with not more than five (5) employees are exempt.
6. Annual return and investments. Trustees of trusteed plans file an annual information return on or before April 15 each year with the RDO. Trust income exemption may be denied for transactions that divert income or corpus, and the Retirement Fund must not be invested in the employer’s business ventures.

Who is affected

• Employers with private retirement plans
• Retiring officials and employees of private firms
• Trustees and insurance companies of retirement plans

Deadlines and effectivity

• Application: within thirty (30) days from effectivity of the retirement plan
• Annual information return: on or before April 15
• Issued April 29, 2025

Summary by Tax Resources PH. It is not a substitute for the full text of the issuance or professional advice.