PAYROLL
GUIDE
Payroll Guide
In this Payroll Guide you’ll see the necessary information regarding your pay. This also shows the steps on how to compute for
your pay by using Alex’s details as an example.
Sample:
Alex is a new non-exempt employee
His first day is on January 4, 2021
His Jan 4 to 8 shifts started at 9am and ended at 6pm.
His Jan 11 to 15 shifts started at 9pm and ended at 6am. (He worked 35 hours within the Night Differential Window)
He had a total of 80 work hours.
His first payout is on January 22, 2021 (Covering Jan 3 to 16, 2021)
His monthly basic pay is P15,000.00
His monthly rice subsidy is P1,500.00
His monthly meal allowance is P1,000.00
Net Pay Breakdown:
The earnings you receive after deductions and taxes
Gross Earnings and Allowances Breakdown
The total earnings before deductions and taxes. Components of Gross Earnings include:
• Pay for regular hours
• Adjustments for Overtime, Night Differential, and Holiday Pay
• Rice Subsidy
• Meal Allowance (Contract Dependent)
• Incentives (Program Based)
Pay formula for Worked Hours
Rate x Hourly Rate (monthly basic pay x 12 months / 26 cutoffs a year / 10 days per cutoff / 8 hours per work day) x Number of hours worked = Earnings
Earning Rate Table
Description
Rate
Regular Work Day
Rest Day Worked
Regular Holiday Worked
Special Holiday Worked
Regular Holiday Worked on Rest Day
Special Holiday Worked on Rest Day
Regular Holiday Not Worked
OT on Regular Work Day
OT on Rest Day Worked
OT on Regular Holiday Worked
OT on Special Holiday Worked
OT on Regular Holiday Worked on Rest Day
OT on Special Holiday Worked on Rest Day
100.00%
130.00%
200.00%
130.00%
260.00%
150.00%
100.00%
125.00%
169.00%
260.00%
169.00%
338.00%
195.00%
Night Differential Rate
20.00%
26.00%
40.00%
26.00%
52.00%
30.00%
25.00%
33.80%
52.00%
33.80%
67.60%
39.00%
For Alex’s regular hours
100% x (P15,000.00 x 12 / 26 / 10 / 8) x 80 = P6,923.08
For Alex’s Night Differential (Night differential is paid for work hours between 10pm to 6am. Meal breaks are not considered work hours)
20% x (P15,000.00 x 12 / 26 / 10 / 8) x 35 = P605.77
Pay formula for Rice Subsidy and Meal Allowance
Cutoff Amount = Monthly Rice Subsidy Amount x 12 months / 26 cutoffs
Rice Subsidy is paid on a monthly basis.
Meal Allowance is calculated on a daily basis
For Alex’s Rice Subsidy (Rice Subsidy is non-taxable)
(P1,500.00 x 12) / 26 = P692.31
For Alex’s Meal Allowance (Meal allowance is taxable if the shift start time for the day is between 6am to 5:59pm)
(P1,000.00 x 12) / 26 = P461.54
Since half of Alex’s work days started within the non-taxable window, half of his meal allowance is non-taxable 461.54 /2 = 230.77)
Gross Earnings and Allowances Total
Regular hours
P6,923.08
Night Differential
P605.77
Rice Subsidy
P692.31
Meal Allowance
P461.54
Total
P8,682.70
Taxes and Deductions
Government mandated deductions and taxes are handled automatically
Government Contributions
• SSS Contribution
• Pag-Ibig Contribution
• Philhealth Contribution
SSS Contribution
SSS contribution depends on gross Earnings and Allowances. Refer to the SSS table (as of January 2021).
RANGE OF
COMPENSATION
Below 3,250
3,250 - 3,749.99
3,750 - 4,249.99
4,250 - 4,749.99
4,750 - 5,249.99
5,250 - 5,749.99
5,750 - 6,249.99
6,250 - 6,749.99
6,750 - 7,249.99
7,250 - 7,749.99
7,750 - 8,249.99
8,250 - 8,749.99
8,750 - 9,249.99
9,250 - 9,749.99
9,750 - 10,249.99
10,250 - 10,749.99
10,740 - 11,249.99
11,250 - 11,749.99
11,750 - 12,249.99
12,250 - 12,749.99
12,750 - 13,249.99
13,250 - 13,749.99
13,750 - 14,249.99
14,250 - 14,749.99
14,750 - 15,249.99
15,250 - 15,749.99
15,750 - 15,249.99
16,250 - 16,749.99
16,750 - 17,249.99
17,250 - 17,749.99
17,750 - 18,249.99
18,250 - 18,749.99
18,750 - 19,249.99
19,250 - 19,749.99
19,750 - 20,249.99
20,250 - 20,749.99
20,750 - 21,249.99
21,250 - 21,749.99
21,750 - 22,249.99
22,250 - 22,749.99
22,750 - 23,249.99
23,250 - 23,749.99
23,750 - 24,249.99
24,250 - 24,749.99
24,750 - over
Monthly Salary Credit
Regular Social
Mandatory
Security/
Provident
Total
Employees'
Fund
Compensation
3,000.00
3,000.00
3,500.00
3,500.00
4,000.00
4,000.00
4,500.00
4,500.00
5,000.00
5,000.00
5,500.00
5,500.00
6,000.00
6,000.00
6,500.00
6,500.00
7,000.00
7,000.00
7,500.00
7,500.00
8,000.00
8,000.00
8,500.00
8,500.00
9,000.00
9,000.00
9,500.00
9,500.00
10,000.00
10,000.00
10,500.00
10,500.00
11,000.00
11,000.00
11,500.00
11,500.00
12,000.00
12,000.00
12,500.00
12,500.00
13,000.00
13,000.00
13,500.00
13,500.00
14,000.00
14,000.00
14,500.00
14,500.00
15,000.00
15,000.00
15,500.00
15,500.00
16,000.00
16,000.00
16,500.00
16,500.00
17,000.00
17,000.00
17,500.00
17,500.00
18,000.00
18,000.00
18,500.00
18,500.00
19,000.00
19,000.00
19,500.00
19,500.00
20,000.00
20,000.00
20,000.00
500.00
20,500.00
20,000.00
1,000.00
21,000.00
20,000.00
1,500.00
21,500.00
20,000.00
2,000.00
22,000.00
20,000.00
2,500.00
22,500.00
20,000.00
3,000.00
23,000.00
20,000.00
3,500.00
23,500.00
20,000.00
4,000.00
24,000.00
20,000.00
4,500.00
24,500.00
20,000.00
5,000.00
25,000.00
REGULAR SOCIAL SECURITY
ER
255.00
297.50
340.00
382.50
425.00
467.50
510.00
552.50
595.00
637.50
680.00
722.50
765.00
807.50
850.00
892.50
935.00
977.50
1,020.00
1,062.50
1,105.00
1,147.50
1,190.00
1,232.50
1,275.00
1,317.50
1,360.00
1,402.50
1,445.00
1,487.50
1,530.00
1,572.50
1,615.00
1,657.50
1,700.00
1,700.00
1,700.00
1,700.00
1,700.00
1,700.00
1,700.00
1,700.00
1,700.00
1,700.00
1,700.00
EE
135.00
157.50
180.00
202.50
225.00
247.50
270.00
292.50
315.00
337.50
360.00
382.50
405.00
427.50
450.00
472.50
495.00
517.50
540.00
562.50
585.00
607.50
630.00
652.50
675.00
697.50
720.00
742.50
765.00
787.50
810.00
832.50
855.00
877.50
900.00
900.00
900.00
900.00
900.00
900.00
900.00
900.00
900.00
900.00
900.00
TOTAL
390.00
455.00
520.00
585.00
650.00
715.00
780.00
845.00
910.00
975.00
1,040.00
1,105.00
1,170.00
1,235.00
1,300.00
1,365.00
1,430.00
1,495.00
1,560.00
1,625.00
1,690.00
1,755.00
1,820.00
1,885.00
1,950.00
2,015.00
2,080.00
2,145.00
2,210.00
2,275.00
2,340.00
2,405.00
2,470.00
2,535.00
2,600.00
2,600.00
2,600.00
2,600.00
2,600.00
2,600.00
2,600.00
2,600.00
2,600.00
2,600.00
2,600.00
AMOUNT OF CONTRIBUTIONS
EMPLOYEE'S
MANDATORY PROVIDENT
COMPENSATION
FUND
ER
10.00
10.00
10.00
10.00
10.00
10.00
10.00
10.00
10.00
10.00
10.00
10.00
10.00
10.00
10.00
10.00
10.00
10.00
10.00
10.00
10.00
10.00
10.00
10.00
30.00
30.00
30.00
30.00
30.00
30.00
30.00
30.00
30.00
30.00
30.00
30.00
30.00
30.00
30.00
30.00
30.00
30.00
30.00
30.00
30.00
EE
-
TOTAL
10.00
10.00
10.00
10.00
10.00
10.00
10.00
10.00
10.00
10.00
10.00
10.00
10.00
10.00
10.00
10.00
10.00
10.00
10.00
10.00
10.00
10.00
10.00
10.00
30.00
30.00
30.00
30.00
30.00
30.00
30.00
30.00
30.00
30.00
30.00
30.00
30.00
30.00
30.00
30.00
30.00
30.00
30.00
30.00
30.00
ER
42.50
85.00
127.50
170.00
212.50
255.00
297.50
340.00
382.50
425.00
EE
22.50
45.00
67.50
90.00
112.50
135.00
157.50
180.00
202.50
225.00
TOTAL
65.00
130.00
195.00
260.00
325.00
390.00
455.00
520.00
585.00
650.00
TOTAL
ER
265.00
307.50
350.00
392.50
435.00
477.50
520.00
562.50
605.00
647.50
690.00
732.50
775.00
817.50
860.00
902.50
945.00
987.50
1,030.00
1,072.50
1,115.00
1,157.50
1,200.00
1,242.50
1,305.00
1,347.50
1,390.00
1,432.50
1,475.00
1,517.50
1,560.00
1,602.50
1,645.00
1,687.50
1,730.00
1,772.50
1,815.00
1,857.50
1,900.00
1,942.50
1,985.00
2,027.50
2,070.00
2,112.50
2,155.00
EE
135.00
157.50
180.00
202.50
225.00
247.50
270.00
292.50
315.00
337.50
360.00
382.50
405.00
427.50
450.00
472.50
495.00
517.50
540.00
562.50
585.00
607.50
630.00
652.50
675.00
697.50
720.00
742.50
765.00
787.50
810.00
832.50
855.00
877.50
900.00
922.50
945.00
967.50
990.00
1,012.50
1,035.00
1,057.50
1,080.00
1,102.50
1,125.00
TOTAL
400.00
465.00
530.00
595.00
660.00
725.00
790.00
855.00
920.00
985.00
1,050.00
1,115.00
1,180.00
1,245.00
1,310.00
1,375.00
1,440.00
1,505.00
1,570.00
1,635.00
1,700.00
1,765.00
1,830.00
1,895.00
1,980.00
2,045.00
2,110.00
2,175.00
2,240.00
2,305.00
2,370.00
2,435.00
2,500.00
2,565.00
2,630.00
2,695.00
2,760.00
2,825.00
2,890.00
2,955.00
3,020.00
3,085.00
3,150.00
3,215.00
3,280.00
ER represents employer contribution
EE represents employee contribution
SSS contribution is deducted at every cutoff. Note that the SSS contribution follows a monthly schedule and will not always be in-sync with payouts. This will cause
some variance in contribution amounts.
Since Alex’s Gross Earnings is P8,682.70, he belongs in the 8,250-8749.99 range. His contribution is P382.50
Pag-Ibig Contribution
Philhealth Contribution
Employees earning a monthly compensation of more than 1,500 are
subject to a maximum contribution equivalent to 2% of their monthly
income or 100 pesos.
Monthly premium contribution shall be at a rate of 3.5% of the employee’s
monthly salary, with a floor of 10,000 and a ceiling of 70,000.
Philhealth contribution is deducted on the first payout of the month.
By default, all employees contribute P100.00. You may reach out to EE
to have your contribution adjusted.
For Alex’s Philhealth Contribution
15,000.00 x 3.5% = P262.50
Total Deductions
SSS Contribution
Pag-Ibig Contribution
Philhealth Contribution
Total
P382.50
P100.00
P262.50
P745.00
Taxes
Tax depends on the amount of taxable income.
Taxable income is computed by taking the Gross Income and Allowances and deducting the Government Contributions and Non-Taxable income.
Taxable Income = Total Gross Earnings and Allowances - Total Deductions – (Rice Subsidy + Non-taxable Meal Allowance)
For Alex’s taxable income
P8,682.70 - P745.00 – (P692.31+ P230.77) = P7,937.70
Philippine Annual Tax Table (365 days)
Fortnightly Tax Table (14 days)
Amount of Net Taxable Income
But Not Over
Rate
Over
P250,000
P400,000
P800,000
P2,000,000
P8,000,000
P250,000
P400,000
P800,000
P2,000,000
P8,000,000
Over
no tax
20% of the excess over P250,000
P30,000 + 25% of the excess over P400,000
P130,000 + 30% of the excess over P800,000
P490,000 + 32% of the excess over P2,000,000
P2,410,000 + 35% of the excess over P8,000,000
P9,615.38
P15,384.62
P30,769.23
P76,923.08
P307,692.31
Amount of Net Taxable Income
But Not Over
Rate
P9,615.38
P15,384.62
P30,769.23
P76,923.08
P307,692.31
no tax
20% of the excess over P9,615.38
P1,154 + 25% of the excess over P15,384.62
P5,000 + 30% of the excess over P30,769.23
P18,846 + 32% of the excess over P76,923.08
P92,692 + 35% of the excess over P307,692.31
Since Alex falls under the P0 – P9,615.38 bracket. He is not required to pay any taxes.
Taxes are still computed annually. Fortnightly taxes assumes that an employee would maintain the income rate for the entire year. If the employee paid more
taxes than the annual tax table requires, the excess amount will be returned.
Net Pay Computation
Net Pay = (Gross Earnings and Allowances) – (Taxes and Deductions)
For Alex’s Net Pay
P8,682.70 – (P0.00 + P745.00) = P7,937.70
Reference
Over
Payout Calendar
PP
Payout Date
January
February
March
April
May
June
July
August
September
October
November
December
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
1/8/2021
1/22/2021
2/5/2021
2/19/2021
3/5/2021
3/19/2021
4/2/2021
4/16/2021
4/30/2021
5/14/2021
5/28/2021
6/11/2021
6/25/2021
7/9/2021
7/23/2021
8/6/2021
8/20/2021
9/3/2021
9/17/2021
10/1/2021
10/15/2021
10/29/2021
11/12/2021
11/26/2021
12/10/2021
12/24/2021
Pay Period
From
To
12/20/2020
1/3/2021
1/17/2021
1/31/2021
2/14/2021
2/28/2021
3/14/2021
3/28/2021
4/11/2021
4/25/2021
5/9/2021
5/23/2021
6/6/2021
6/20/2021
7/4/2021
7/18/2021
8/1/2021
8/15/2021
8/29/2021
9/12/2021
9/26/2021
10/10/2021
10/24/2021
11/7/2021
11/21/2021
12/5/2021
1/2/2021
1/16/2021
1/30/2021
2/13/2021
2/27/2021
3/13/2021
3/27/2021
4/10/2021
4/24/2021
5/8/2021
5/22/2021
6/5/2021
6/19/2021
7/3/2021
7/17/2021
7/31/2021
8/14/2021
8/28/2021
9/11/2021
9/25/2021
10/9/2021
10/23/2021
11/6/2021
11/20/2021
12/4/2021
12/18/2021
NOTICE: This document contains information that may be confidential or protected by privilege from disclosure and is intended only for company personnel. No one
else may disclose, copy, distribute, or use the contents of this document for any purpose. Its unauthorized use, dissemination, or duplication is strictly prohibited and
may be unlawful.