Philippines Salary Deductions & Overtime Calculator (2019)
Calculate your net salary after mandatory deductions (SSS, PhilHealth, Pag-IBIG) and overtime pay based on 2019 rates. Updated with official government tables.
Deduction Breakdown:
Comprehensive Guide to Salary Deductions in the Philippines (2019) with Overtime Calculations
Understanding your salary deductions is crucial for financial planning, especially when factoring in overtime work. This guide explains the mandatory deductions (SSS, PhilHealth, Pag-IBIG), how overtime pay is calculated, and provides real-world examples based on 2019 rates.
1. Mandatory Government Deductions (2019 Rates)
Social Security System (SSS)
The SSS contribution is shared between employer and employee. For 2019, the maximum monthly salary credit was ₱20,000, with a contribution rate of 11% (employee shares 3.63%).
| Salary Range | Employee Share | Employer Share |
|---|---|---|
| ₱1,000 – ₱1,249.99 | ₱36.30 | ₱73.70 |
| ₱1,250 – ₱1,749.99 | ₱54.50 | ₱109.50 |
| ₱1,750 – ₱2,249.99 | ₱72.70 | ₱145.30 |
| ₱19,750 – ₱20,249.99 | ₱727.20 | ₱1,454.80 |
Philippine Health Insurance (PhilHealth)
PhilHealth premiums in 2019 were calculated as 2.75% of monthly basic salary (shared equally between employer and employee), with a salary floor of ₱10,000 and ceiling of ₱40,000.
| Salary Range | Monthly Premium |
|---|---|
| ₱10,000 – ₱39,999.99 | ₱275.00 |
| ₱40,000 and above | ₱1,100.00 |
Home Development Mutual Fund (Pag-IBIG)
The Pag-IBIG contribution rate in 2019 was 2% of monthly compensation, with a maximum of ₱100 for employees earning ₱5,000 or more. Employers matched this contribution.
| Monthly Compensation | Employee Contribution |
|---|---|
| ₱1,500 or below | ₱30.00 |
| ₱1,501 – ₱5,000 | 1% of monthly compensation |
| ₱5,000 and above | ₱100.00 |
2. Overtime Pay Calculations (2019 Labor Code)
Overtime pay in the Philippines is governed by DOLE’s Labor Code (Article 87). The rates vary based on:
- Regular workday overtime: +25% of hourly rate
- Rest day/special holiday: +30% of hourly rate
- Regular holiday: +100% of hourly rate (200% total)
- Night differential: +10% (10PM-6AM)
Overtime Rate Examples (2019)
| Scenario | Multiplier | Example (₱100/hr base) |
|---|---|---|
| Regular day overtime | 1.25x | ₱125.00/hr |
| Rest day overtime | 1.50x | ₱150.00/hr |
| Special holiday | 1.30x | ₱130.00/hr |
| Regular holiday | 2.00x | ₱200.00/hr |
| Night differential (10PM-6AM) | +10% | +₱10.00/hr |
Sample Computation
For an employee with:
- Monthly salary: ₱25,000
- Hourly rate: ₱115.38 (25,000/216 hours)
- 5 hours overtime on a regular day
Overtime pay = 5 × ₱115.38 × 1.25 = ₱719.25
Note: The first 8 hours of work on a rest day/special holiday is paid at 130%, while hours beyond 8 are paid at 130% + 30% (169%).
3. Withholding Tax (BIR Table for 2019)
The Bureau of Internal Revenue (BIR) uses a progressive tax table for withholding taxes. For 2019, the rates were:
| Annual Taxable Income | Tax Rate | Tax Due |
|---|---|---|
| ₱0 – ₱250,000 | 0% | ₱0 |
| ₱250,001 – ₱400,000 | 20% | ₱0 + 20% of excess over ₱250,000 |
| ₱400,001 – ₱800,000 | 25% | ₱30,000 + 25% of excess over ₱400,000 |
| ₱800,001 – ₱2,000,000 | 30% | ₱130,000 + 30% of excess over ₱800,000 |
Monthly computation:
- Subtract mandatory deductions (SSS, PhilHealth, Pag-IBIG) from gross salary.
- Apply the annualized tax table to the remaining taxable income.
- Divide by 12 for monthly withholding tax.
4. Voluntary Deductions
These may include:
- SSS/Pag-IBIG loans: Typically 2-10% of salary
- Company benefits: HMO, retirement plans
- Union dues: If applicable
- Salary advances: Repayments for cash advances
5. Common Questions About Salary Deductions
Q: Are overtime payments subject to tax?
A: Yes, overtime pay is considered part of your taxable income and is subject to withholding tax if your total compensation exceeds the ₱250,000 annual threshold.
Q: How is the 13th-month pay calculated?
A: The 13th-month pay is equivalent to 1/12 of your total basic salary earned within a calendar year. It is tax-exempt up to ₱90,000.
Q: Can I opt out of PhilHealth or SSS?
A: No, these are mandatory contributions for all employed Filipinos under the Social Security Act of 2018.
Q: What happens if I work on a regular holiday?
A: You are entitled to 200% of your regular wage for the first 8 hours (double pay). Any overtime beyond 8 hours is paid at 200% + 30% (260% total).
Q: How is night differential calculated?
A: Add 10% of your hourly rate for each hour worked between 10 PM and 6 AM. This applies to both regular and overtime hours.
Q: Are bonuses taxed?
A: Yes, bonuses (except 13th-month pay up to ₱90k) are subject to a flat 15% tax if the total annual bonus does not exceed ₱250,000.
6. Practical Tips for Employees
- Review your payslip: Ensure all deductions match the official tables. Common errors include incorrect SSS brackets or unapproved voluntary deductions.
- Track overtime: Keep a personal log of overtime hours worked, including the specific dates and rates applied.
- Understand your benefits: Some companies offer overtime conversion to leave credits instead of cash payment.
- Plan for taxes: Use the BIR’s tax calculator to estimate annual liabilities, especially if you have multiple income sources.
- Maximize government benefits: Ensure your SSS, PhilHealth, and Pag-IBIG contributions are up-to-date to qualify for loans, medical benefits, and housing programs.
7. Employer Responsibilities (2019)
Under the DOLE Labor Code, employers must:
- Remit employee contributions (SSS, PhilHealth, Pag-IBIG) by the 10th of the following month.
- Provide itemized payslips showing all deductions.
- Pay overtime within the same pay period it was earned.
- Maintain records of working hours for at least 3 years.
- Post a copy of the company’s overtime policy in the workplace.
Non-compliance may result in penalties under Article 288 of the Labor Code (Unfair Labor Practice).
Key Takeaways
- Your net salary is typically 12-20% less than your gross salary due to mandatory deductions.
- Overtime pay varies significantly based on the day (regular, rest day, or holiday).
- The 13th-month pay is a legal requirement and must be paid by December 24.
- Always verify your payslip against official contribution tables.
- Voluntary deductions (e.g., loans) can be negotiated with your employer.
- Use this calculator to plan your budget and understand your take-home pay.