Commentary

1.4 Fringe benefits tax

Philippines
Philippines | Commentary

1.4 Fringe benefits tax

Philippines | Commentary

1.4     Fringe benefits tax

The Tax Code, Title II, Section 33 imposes a fringe benefits tax (FBT) charge on the employer. Benefits subject to the FBT are not taxable on the employee.

Fringe benefit means any good, service or other benefit furnished or granted in cash or in kind by an employer to an individual employee (except rank-and-file employees).

Rank-and-file employees are all employees who hold neither managerial nor supervisory positions as defined by Labor Law Omnibus Rules Book V, section 1(o).

Managerial employees are those vested with the power to, amongst other things, execute management policies, hire, layoff, assign or discipline employees. Supervisory employees are those who can recommend such action using independent judgement.

Most common benefits to which FBT applies are:

  1.  

    •     housing

  2.  

    •     expense

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