What are De Minimis Benefits and How to Set it Up on Sprout Payroll?

 

According to TRAIN RA 10963, de minimis benefits are benefits of relatively small values provided by employers to their employees on top of their basic compensation. Due to its nature, de minimis benefits are tax-exempt, which means it's not subjected to withholding tax.

 

Under RR 8-00, as amended by RR 10-00, the Bureau of Internal Revenue considers the following as de minimis benefits both for rank-and-file and managerial employees:

1. Monetized unused vacation leave credits of private employees not exceeding ten (10) days during the year;
2. Monetized value of vacation and sick leave credits paid to government officials and employees;
3. Medical cash allowance to dependents of employees, not exceeding ₱1,500 per employee per semester of ₱250 per month;
4. Rice subsidy of ₱2,000 or one sack of 50kg. rice per month amounting to not more than ₱2,000;
5. Uniform and clothing allowance not exceeding ₱6,000 per annum;
6. Actual medical allowance, not exceeding ₱10,000 per annum;
7. Laundry allowance not exceeding ₱300 per month;
8. Employees achievement awards;
9. Gifts made during Christmas and major anniversary celebrations not exceeding ₱5,000 per employee per annum;
10. Daily meal allowance for overtime work not exceeding 25% of the basic minimum wage;
11. Benefits received by an employee by virtue of a collective bargaining agreement (CBA).

Now, if you'd like to include the de minimis benefits for a specific employee on Sprout Payroll, just follow these easy steps:

 

(1) Once you log in to Sprout Payroll, select Employees.

 

 

(2) In the Employees page, you can easily find a specific employee by entering the necessary information in the fields indicated below.

 

 

(3) To access the employee's salary details, click on Edit.

 

 

(4) To input the employee's de minimis benefits, look for the Salary Details tab. Make sure you click on Update located at the bottom of the page to save any changes made.