What are De Minimis Benefits?

5) What are De Minimis Benefits?

- These are facilities and privileges of relatively small value and are offered or furnished by the employer to his employees merely as means of promoting their health, goodwill, contentment or efficiency. The following shall be considered "De Minimis" benefits not subject to income tax, hence not subject to withholding tax on compensation income of both managerial and rank and file employees:

• Monetized unused vacation leave credits of private employees not exceeding ten (10) days during the year;

• Monetized value of vacation and sick leave credits paid to government officials and employees.

• Medical cash allowance to dependents of employees, not exceeding P750.00 per employee per semester or P125.00 per month;

• Rice subsidy of P1,500 or one (1) sack of 50 kg. rice per month amounting to not more than P1,500;

• Uniform and clothing allowance not exceeding P5,000 per annum;

• Actual medical assistance, e.g. medical allowance to cover medical and healthcare needs, annual medical/executive check-up, maternity assistance, and routine consultations, not exceeding P10,000 per annum;

• Laundry allowance not exceeding P300.00 per month;

• Employees achievement awards, e.g., for length of service or safety achievement, which must be in the form of a tangible personal property other than cash or gift certificate, with an annual monetary value not exceeding P10,000 received by the employee under an established written plan which does not discriminate in favor of highly paid employees;

• Gifts given during Christmas and major anniversary celebration not exceeding P5,000.00 per employee perannum;

• Daily meal allowance for overtime work and night/graveyard shift not exceeding twenty-five percent (25%) of the basic minimum wage on a per region basis;

Source : http://www.bir.gov.ph/index.php/tax-information/withholding-tax.html#wt0013