What a Philippine payslip has to show
Most small employers discover the payslip rule the hard way — during a DOLE inspection, or when a former employee files a money claim. It is worth ten minutes of reading, because the standard is not "we told them the amount".
The legal basis is spread across a few issuances rather than sitting in one headline article, which is exactly why it catches people out. The Labor Code sets when wages are paid — at least once every two weeks or twice a month, at intervals not exceeding sixteen days (Art. 103). The content requirement comes from the Omnibus Rules Implementing the Labor Code, Book III, Rule X, Section 6, which requires every employer to pay employees by means of a payroll showing, for each worker, the length of time paid, the rate of pay, the amount due for regular work, the amount due for overtime, the deductions made, and the amount actually paid. DOLE's labor-standards inspections treat the issuance of an itemized payslip each pay period as a general labor standard, and the Kasambahay Law (RA 10361) states the duty explicitly for domestic workers.
The working checklist
- Employer name and address, and the employee's name and position.
- Pay period covered and the pay date — the two dates that let anyone reconstruct the computation later.
- Rate of pay and its basis — monthly, daily, or hourly.
- Gross earnings, broken out: basic pay for the period, overtime, night shift differential, holiday and rest-day premiums, and each allowance on its own line.
- Every deduction, itemised and named — SSS, PhilHealth, Pag-IBIG, withholding tax, SSS and Pag-IBIG loan amortisations, and any other authorised deduction.
- Total deductions and the net pay actually received.
A single line reading "deductions ₱4,320.00" is not compliant. The operative word in the rules is itemised: the worker has to be able to see where each peso went. That is the whole reason this generator prints the deduction column line by line.
What you may and may not deduct
Deductions from wages are limited to those authorised by law, by a collective bargaining agreement, or in writing by the employee for the employee's own benefit. You cannot unilaterally deduct for cash shortages, breakage or losses. DOLE Labor Advisory No. 11, series of 2014 sets out the conditions where a deduction for loss or damage is allowed at all: the employee must be clearly shown to be responsible, must be given a chance to show cause, and the deduction must not exceed 20% of the employee's wages for the week. Paper or electronic delivery is both fine, as long as the employee can actually access and keep a copy.
How the employee-share contributions are computed
The table above lists the rates; here is what each one actually does to a real salary. The figures in the last column are for a worker on a ₱20,000 monthly basic salary.
SSS — 5% of a bracket, not of the salary
The total SSS rate reached 15% in 2025, the final step of the schedule in the Social Security Act of 2018 (RA 11199), and it stays at 15% for 2026. The employer carries 10% and the employee 5%. The percentage is applied not to the raw salary but to the Monthly Salary Credit — a bracket from the published SSS table, running in ₱500 steps between ₱5,000 and ₱35,000. Above an MSC of ₱20,000, the contribution on the slice over ₱20,000 is routed to the member's Mandatory Provident Fund (WISP) — the same money, a second retirement bucket, not an extra charge. The employer additionally pays the Employees' Compensation premium (₱10, or ₱30 at MSC ₱15,000 and above) entirely on its own.
This tool approximates the bracket by rounding the basic salary to the nearest ₱500 and clamping it to the MSC range. That lands on the right bracket for most salaries, but the published SSS contribution schedule is the authority — check it, and override the field if the two differ.
PhilHealth — half of a 5% premium
PhilHealth confirmed a 5% premium rate for 2026, unchanged from 2025 and the last scheduled step under the Universal Health Care Act (RA 11223). Employer and employee split it equally, so the deduction on the payslip is 2.5% of monthly basic pay. Below ₱10,000 basic the premium is fixed at the floor (₱500 total, ₱250 each); at or above ₱100,000 it is capped at the ceiling (₱5,000 total, ₱2,500 each).
Pag-IBIG — 2% of a capped base
Employees earning more than ₱1,500 a month contribute 2%; those at ₱1,500 and below contribute 1%. Either way the rate is applied only up to the Maximum Fund Salary, which HDMF Circular No. 460 doubled from ₱5,000 to ₱10,000 in 2024 and which still governs in 2026. So the mandatory employee maximum is ₱200 a month. Employees may voluntarily contribute more; the employer's counterpart stays at ₱200.
Employer share vs employee share
This tool computes the employee share only — the money deducted from the worker's pay and shown in the deduction column. The employer's counterpart is a separate business cost. It never appears on the payslip, but it is remitted in the same transaction and it is not optional.
Two rules that get employers into trouble. First, you cannot pass the employer counterpart on to the worker by deducting it from pay — that is an illegal deduction, and it is the sort of thing a DOLE inspection or a money claim surfaces immediately. Second, the employer, not the employee, is liable for remittance. Deducting correctly and remitting late still exposes the business to penalties and interest, and in the case of SSS, to liability for benefits the worker could not claim.
Withholding tax on compensation
Taxable compensation for the month is basic pay plus overtime plus taxable allowances, less the employee's mandatory SSS, PhilHealth and Pag-IBIG contributions (and union dues). De minimis benefits within their ceilings and the first ₱90,000 of 13th-month pay and other benefits are excluded. Whatever is left goes through the BIR's monthly table, in force since 1 January 2023 under the TRAIN Law:
If you pay semi-monthly, use the semi-monthly column of the same BIR table — where the exempt threshold is ₱10,417 — rather than halving the monthly result. The two are close but not identical, and the difference compounds over twelve months.
The ₱90,000 threshold is a different animal. It is an annual ceiling covering 13th-month pay together with other benefits — Christmas bonus, mid-year bonus, productivity and performance incentives — added up for the year. It is not part of the monthly table, and it is not the same pot as de minimis benefits, which sit outside it entirely. Only the amount above ₱90,000 becomes taxable compensation. Because 13th-month pay is a separate annual computation, this generator deliberately leaves it out of the monthly payslip.
And December squares the books. Year-end annualisation reconciles the twelve monthly withholdings against the annual tax due; the difference is refunded to the employee or collected in the last payroll. You then issue BIR Form 2316 to each employee on or before 31 January.
Five mistakes that show up on real payslips
1. Not pro-rating a partial month
New hires who start on the 16th, resignations mid-cycle, unpaid leave — in all three the earnings for the period are a fraction of the monthly rate, but the contributions are not. SSS, PhilHealth and Pag-IBIG are computed on the monthly salary bracket, not on the partial amount actually paid. This tool takes one "monthly basic salary" figure and uses it for both, so for a partial period: enter the pro-rated amount in the earnings field, then switch off auto-compute (or simply type over the three contribution fields) using the figures for the full monthly bracket.
2. Rolling allowances into basic salary
Contribution brackets, 13th-month pay, overtime and holiday premiums are all computed on basic salary. Folding a ₱3,000 transport allowance into "basic" quietly inflates every one of them and is very hard to unwind a year later. Keep allowances on their own lines — that is exactly what the allowance rows above are for.
3. Mis-tagging de minimis benefits
Benefits within the BIR's de minimis ceilings are not taxable and do not touch the ₱90,000 pot; anything above a ceiling is taxable, with the excess flowing into that ₱90,000 other-benefits pool. The ceilings moved recently: Revenue Regulations No. 29-2025, effective 6 January 2026, raised the rice subsidy to ₱2,500 a month, uniform and clothing allowance to ₱8,000 a year, medical cash allowance for dependents to ₱2,000 a semester, laundry allowance to ₱400 a month, actual medical assistance and employee achievement awards to ₱12,000 a year, Christmas and major-anniversary gifts to ₱6,000 a year, and monetised unused vacation leave to 12 days. Check the current list against the regulation itself before you tick — or leave unticked — the "Tax" box on an allowance row.
4. Leaving premiums off the slip
Overtime, night shift differential (an extra 10% for work between 10:00 pm and 6:00 am), holiday pay and rest-day premiums are earnings and belong in the earnings column, itemised. If they are folded into one number, the payslip fails the itemisation standard even when the total is correct.
5. Deducting loans without naming them
SSS salary loans, Pag-IBIG multi-purpose loans, cash advances and tardiness each deserve their own named line in "Other deductions". An employee who can see "SSS salary loan ₱1,200.00" does not file a complaint about a mystery deduction.
How long to keep payroll records
There are two clocks running, and they are different lengths.
- Labour side: at least three years. The Omnibus Rules Implementing the Labor Code require employment records — payrolls, payslips, time records — to be kept at the workplace and preserved for at least three years from the date of the last entry. Money claims under the Labor Code also prescribe in three years. Crucially, in a wage dispute the burden of producing payroll records falls on the employer: if the records are missing, the employee's version of the numbers usually stands.
- Tax side: ten years. Books of accounts and the records supporting your BIR returns must be preserved for ten years under RR No. 17-2013 as amended by RR No. 5-2014 — the first five years in hard copy, the remaining five in electronic form. Payroll registers, alphalists and Form 2316 copies fall under this.
Payslips are also personal and, in places, sensitive personal information under the Data Privacy Act (RA 10173). Store them where only the people who need them can reach them, do not email them unprotected to group addresses, and dispose of them properly once both clocks have run out.
Related free tools. Billing clients instead of paying staff? The invoice generator handles the 12% VAT breakdown and creditable withholding tax at 2%, 5% or 10%. Working out your own taxes as a freelancer or sole proprietor? The 8% vs graduated tax calculator compares both BIR options and lists the 2026 deadlines. And the invite builder is free too, for when the team finally has something to celebrate.
Disclaimer: this page and the generator are a computation aid, not legal, tax or payroll advice, and they do not create an employer–employee compliance record on your behalf. Contribution schedules, withholding tables and de minimis ceilings change — RR No. 29-2025 alone moved eight of them in January 2026. Verify every figure against the current SSS, PhilHealth, Pag-IBIG, BIR and DOLE issuances, and consult a payroll professional or your DOLE regional office for anything unusual, before releasing pay.