Employer Social Contributions in the Philippines: How to Pay SSS, PhilHealth and Pag-IBIG

Three Mandatory Contributions: The Employer's Monthly Routine

To employ staff lawfully in the Philippines, an employer must remit three mandatory statutory contributions per employee each month:

• SSS (Social Security System): social security for private-sector employees — retirement, sickness, maternity, unemployment, death benefits, and so on.
• PhilHealth (Philippine Health Insurance Corporation): national health insurance covering hospitalization and some medical costs.
• Pag-IBIG (HDMF, Home Development Mutual Fund): a savings and housing-loan fund.

All three are shared between employer and employee: the employee share is withheld from pay, added to the employer's own share, and filed and remitted monthly. For a member-side overview of the three systems, see the SSS/PhilHealth/Pag-IBIG member guide; for the legal basis of employment, see Philippine labor law basics.

Below is each fund's split — the exact rates and salary floors/ceilings can change every year, so treat the following as a broad framework and always rely on each agency's current issuances.

SSS: The Employer Carries the Larger Share

SSS contributions are computed by Monthly Salary Credit (MSC) brackets, not by simply multiplying the full wage. The core framework (per current SSS issuances):

• The total rate has risen in steps under the Social Security Act of 2018 (RA 11199) schedule and currently stands at around 15% of the wage, with the employer carrying roughly two-thirds and the employee about one-third (employer ~10%, employee ~5%, per the year's actual rate).
• MSC has floors and ceilings, so even very low or very high wages are bracketed within a range (the floor and ceiling may rise each year).
• For higher earners, the portion above a certain MSC feeds into the WISP (a mandatory provident-style top-up scheme).
• The employer usually also pays a small EC (Employees' Compensation) contribution, low in amount and borne entirely by the employer.

In practice, employers use the SSS-published contribution schedule to find each employee's employer and employee amounts by wage bracket and remit monthly. The rates and brackets are policy figures that change — don't use an old table.

PhilHealth: Percentage-Based, Split 50/50

PhilHealth is relatively straightforward: a percentage rate on the monthly wage, with the employer and employee each paying half (50/50).

Framework points (per current PhilHealth issuances):

• The premium rate in recent years has been about 5% of monthly wage (this figure has moved along the Universal Health Care (UHC) implementation schedule and may change again).
• There are income floors and ceilings: below the floor it is computed at the floor; above the ceiling it is capped, and wages above the ceiling add no more premium.
• The employer withholds the employee's half from pay, adds the employer half, and remits monthly.

Note: PhilHealth rates and floors/ceilings are adjusted fairly often — always compute with the latest issued figures to avoid over-withholding or under-remitting.

Pag-IBIG: Small Amounts, But Don't Skip Them

Pag-IBIG (HDMF) housing-fund contributions are relatively small, but equally mandatory:

• Employee share: generally 1% or 2% of monthly wage (1% for lower pay, 2% above a threshold).
• Employer share: typically 2%.
• There is a computation cap: the monthly wage used to compute is capped (the ceiling has risen in recent years), so each person's mandatory monthly contribution has a relatively low maximum; employees may also contribute more voluntarily.

Although the amounts are small, Pag-IBIG is still part of the employer's monthly compliance duty, and skipping it still incurs penalties. Together, the three make up the employer's fixed monthly routine of "withhold + pay employer share + file and remit."

How to File and Remit, and How to Register New Hires

Each fund has its own filing/remittance system and deadline, handled separately:

• SSS: generate a PRN (Payment Reference Number) via the SSS online system, then pay and file the contribution details.
• PhilHealth: generate the report and pay through the EPRS (Electronic Premium Remittance System).
• Pag-IBIG: file and pay through its remittance channel.

Deadlines are usually staggered by employer number/size, and they differ across agencies and months, so check each one — don't assume a single date.

On registering new hires: a new employee must first be registered/reported as your company's employee in all three systems (the individual needs their own member numbers first), after which you remit for them monthly. Handle social-contribution registration at onboarding rather than scrambling later. Monthly payroll plus all three contributions can be outsourced to the Yixing compliance team.

Late Penalties: Surcharges for Delay, Criminal Exposure for Chronic Non-Payment

Contributions are a rigid obligation, and the cost of lateness or non-payment is significant:

• SSS: late payment typically adds a penalty of around 2% per month (accruing on the arrears and the number of months) — the longer you wait, the more it grows.
• PhilHealth and Pag-IBIG: also carry late interest/penalties.
• More serious still: an employer that withheld the employee share but failed to remit it, or that chronically refuses to pay, may face criminal liability, and company officers can be held accountable.

In other words, contributions are not a soft cost to "owe for now and catch up later," but a hard obligation due on time each month. The disciplined approach is to build all three into a fixed monthly payroll process, settle by each deadline, and keep the payment receipts.

Do Foreign Employees Contribute?

This is the most common question from foreign-owned firms. The general direction: foreign employees working in the Philippines are generally covered by the mandatory contributions too — being a foreigner is not an automatic exemption.

• SSS: foreign employees working in the Philippines are, in principle, compulsorily covered, but where the home country has a social-security totalization agreement with the Philippines, there may be exemptions or special arrangements.
• PhilHealth: foreign nationals employed in the Philippines with a valid work permit typically need to contribute.
• Pag-IBIG: under recent rules, foreign employees are generally within scope as well.

Whether a given foreign employee must contribute, or can be exempt under a treaty, depends on nationality, visa/work-permit type and the latest rules, and cases vary widely — always rely on each agency's current rules or verify first. For aligning foreign employees' work visas with contributions, consult the Yixing HR and visa team.

Employer Compliance Points and Disclaimer

A few pragmatic reminders for employers:

• Rates and floors/ceilings can change yearly — don't use an old table. All three agencies adjust their schedules; compute with the latest issuances.
• Register new hires at onboarding. Don't discover at filing time that someone was never reported.
• Pay by each deadline, staggered by employer number. The three deadlines don't fully align — track each.
• The withheld employee share must be remitted. Withholding and not remitting is the highest-risk error and can be criminal.

This article is general information only and is not legal or tax advice. The rates, salary floors/ceilings, filing methods and foreign-employee rules for SSS, PhilHealth and Pag-IBIG change as policy is updated; always rely on each agency's current issuances or consult a professional. To build payroll, all three contributions, 13th month pay and income-tax withholding into one compliant monthly process, contact the Yixing compliance team for an initial review.