De minimis benefits are small, tax-free perks that employers in the Philippines can give employees without withholding tax. For 2026, the BIR raised most of the ceilings through Revenue Regulations No. 29-2025, issued on December 22, 2025 and effective January 6, 2026.
Quick answer: The 2026 de minimis limits are: rice subsidy ₱2,500 a month, uniform and clothing allowance ₱8,000 a year, laundry allowance ₱400 a month, medical cash allowance for dependents ₱2,000 per semester, actual medical assistance ₱12,000 a year, Christmas gifts ₱6,000 a year, achievement awards ₱12,000 a year, and monetized unused vacation leave of up to 12 days.
Last updated: October 29, 2026
- RR 29-2025 raised the de minimis ceilings, effective January 6, 2026.
- Benefits within the ceilings are tax-free and are not counted toward the ₱90,000 limit for 13th-month pay and other benefits.
- Any amount above a ceiling counts toward that ₱90,000 limit, and only the excess over ₱90,000 is taxed.
- The list is exclusive. Allowances not on it, such as transportation or internet allowances, are not de minimis.
De Minimis Benefits 2026: Complete List
These are the tax-free ceilings under Revenue Regulations No. 2-98 as amended, most recently by RR 29-2025.
| De minimis benefit | 2026 tax-free ceiling | Notes |
|---|---|---|
| Rice subsidy | ₱2,500 a month, or one 50 kg sack worth up to ₱2,500 | Cash or rice |
| Uniform and clothing allowance | ₱8,000 a year | Cash or in kind |
| Laundry allowance | ₱400 a month | |
| Medical cash allowance to dependents | ₱2,000 per semester (₱333 a month) | For employees’ dependents |
| Actual medical assistance | ₱12,000 a year | For example, medical check-ups, maternity aid or annual medical allowances |
| Employee achievement awards | ₱12,000 a year | For length of service or safety, in tangible personal property (not cash or gift certificates), under a written plan that does not favor highly paid employees |
| Christmas and major anniversary gifts | ₱6,000 a year | |
| Meal allowance for overtime and night or graveyard shifts | 30% of the basic minimum wage in the region | Per day of overtime or night work |
| Benefits under a CBA and productivity incentive schemes | ₱12,000 a year, combined | |
| Monetized unused vacation leave (private sector) | Up to 12 days a year | |
| Monetized vacation and sick leave (government) | No ceiling | Government officials and employees only |
What Happens If a Benefit Exceeds the Ceiling?
The amount within the ceiling stays tax-free. The excess is added to “13th-month pay and other benefits”, which are tax-exempt up to ₱90,000 a year in total. Only the amount above ₱90,000 becomes taxable compensation subject to withholding tax.
Example
Gina earns ₱35,000 a month. Her employer pays a rice subsidy of ₱3,000 a month and a 13th-month pay of ₱35,000.
- Tax-free rice subsidy: ₱2,500 × 12 = ₱30,000 a year
- Excess rice subsidy: ₱500 × 12 = ₱6,000 a year, counted as “other benefits”
- 13th-month pay and other benefits: ₱35,000 + ₱6,000 = ₱41,000, below the ₱90,000 limit
- Result: no tax on any of these amounts
If the 13th-month pay, bonuses and excess de minimis together exceeded ₱90,000, only the amount above ₱90,000 would be taxed. Our 13th-month pay guide explains the ₱90,000 limit, and the withholding tax calculator shows how taxable pay is computed.
Rules for Giving De Minimis Benefits
- The list is exclusive. Only the benefits listed above qualify. Transportation, communication, internet and housing allowances are not de minimis. They are generally taxable compensation, unless they are reimbursements of expenses incurred for the employer’s business and properly liquidated.
- Meal allowances apply only to overtime and night work. A regular daily meal allowance for day shifts is not de minimis.
- Achievement awards must be in kind. Cash and gift certificates do not qualify, and the award must follow a written plan that does not favor highly paid employees.
- Medical allowance is per semester. The ₱2,000 dependents’ medical cash allowance is per semester, or ₱333 a month if paid monthly.
- They are not part of the 13th-month base. 13th-month pay is computed on basic salary only, so de minimis benefits do not increase it.
- Show them separately. List de minimis benefits on the payslip and in BIR Form 2316 as non-taxable compensation. See our payslip template for a layout.
- SSS, PhilHealth and Pag-IBIG. De minimis benefits within the ceilings are generally left out of the basic pay used for PhilHealth and Pag-IBIG contributions. Confirm SSS treatment of cash allowances with SSS, since SSS uses total compensation.
What Changed in 2026?
RR 29-2025 amended Revenue Regulations No. 2-98 to raise the ceilings for most de minimis benefits. The new limits applied from January 6, 2026, so payrolls from that date can use them. Employers that kept the older limits in their payroll system for early January should check that the new ceilings were applied from that date.
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Schedule a call with usOfficial sources: Bureau of Internal Revenue (BIR), Revenue Regulations No. 29-2025 amending RR 2-98. Always confirm current ceilings and rules with the BIR or a qualified tax adviser before running payroll.
Frequently Asked Questions
Under RR 29-2025, the 2026 de minimis benefits are: rice subsidy ₱2,500 a month, uniform allowance ₱8,000 a year, laundry allowance ₱400 a month, medical cash allowance to dependents ₱2,000 per semester, actual medical assistance ₱12,000 a year, achievement awards ₱12,000 a year, Christmas gifts ₱6,000 a year, overtime and night-shift meal allowance up to 30% of the regional basic minimum wage, CBA and productivity incentives ₱12,000 a year combined, and monetized unused vacation leave of up to 12 days.
The tax-free rice subsidy is ₱2,500 a month, or one 50 kg sack of rice worth up to ₱2,500 a month, under RR 29-2025.
RR 29-2025 was issued on December 22, 2025 and took effect on January 6, 2026.
No. The de minimis list is exclusive and does not include transportation, communication or internet allowances. These are generally taxable compensation unless they are liquidated reimbursements of business expenses.
The excess is added to 13th-month pay and other benefits, which are tax-exempt up to ₱90,000 a year in total. Only the amount above ₱90,000 is taxed as compensation.
No. 13th-month pay is computed on basic salary only, so de minimis benefits are not part of the computation.
