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BIR Reflects PERA Contribution Amendments and Prescribes Tax Credit Certificate Guidelines
On 07 July 2023, the Bureau of Internal Revenue (“BIR”) issued Revenue Regulations (“RR”) No. 7-2023 which amended certain provisions of RR Nos. 17-2011 and 2-2022, both of which implement Republic Act No. 9505 otherwise known as the Personal Equity and Retirement Account (“PERA”) Act of 2008.
Specifically, Section 2 of RR No. 7-2023 amended Section 2(n) and Section 6 of RR. No. 17-2011 by increasing the maximum qualified contributions of a contributor from PHP100,000.00 for non-overseas Filipinos and PHP200,000.00 for overseas Filipinos, to PHP200,000.00 and PHP400,000.00 respectively.
In relation to this, Section 6 of RR No. 17-2011 now provides the aggregate maximum Qualified PERA Contributions in one calendar year as follows:
Contributor | Maximum Peso* |
Unmarried Filipino Citizen | PHP200,000.00 |
Married Filipino Citizen and both spouses qualify as a contributor | PHP200,000.00 for each qualified contributor |
Married Filipino Citizen and only one spouse qualifies as a contributor | PHP200,000.00 |
Unmarried Overseas Filipino | PHP400,000.00 |
Married Overseas Filipino whose legitimate spouse is neither an Overseas Filipino nor a qualified contributor | PHP400,000.00 |
Married Overseas Filipino whose legitimate spouse and children (not otherwise disqualified as contributors) of an Overseas Filipino who did not directly open any PERA | PHP400,000.00 |
Married Overseas Filipino whose legitimate spouse is also an Overseas Filipino | PHP400,000.00 for each qualified contributor |
Married Overseas Filipino whose legitimate children are not Overseas Filipinos and are not qualified contributors | PHP400,000.00 for the Overseas Filipino |
*Or its equivalent in any convertible foreign currency at the prevailing rate at the time of actual contribution. | |
It must be noted that contributions to the PERA amounting to more than PHP200,000.00 or PHP400,000.00, as the case may be, shall not be accepted by the Administrator under the PERA Account, however, they may be accepted by the Administrator as other Savings/Investment Account after appropriate advice given to the contributor but shall not be entitled to any benefit under the PERA Act.
Section 2 of RR No. 17-2011 likewise amended Section 4 of RR No. 2-2022. The amendment added a clause pertaining to the expiration of a PERA tax credit certificate (“TCC”) stating that a TCC which is not used within 5 years from issuance shall be invalidated. It will be barred from being used as payment for internal revenue tax liabilities of the concerned contributor. Furthermore, the amount represented by the TCC shall be automatically cancelled by the ePERA system. Moreover, damaged, or lost certificates are no longer subject to reissuance after 5 years from the date of issuance of the original certificate.