Wondering how much will you get from SSS contribution when you retire? Based from my research, the amount of monthly pension depends on contribution and time. Question is, is this monthly pension enough at the time you retire?

Retirement benefit is a cash benefit either in monthly pension or lump sum paid to a member who can no longer work due to old age.

Qualifications

• A member who is 60 years old, separated form employment or ceased to be self-employed, and has paid at least 120 monthly contributions prior to the semester of retirement. 
• A member who is 65 years old whether employed or not and has paid at least 120 monthly contributions prior to the semester of retirement. 

For Underground Mine workers: 

• Has reached the age of 55 years old and is an underground mine worker for at least 5 years (either continuous or accumulated) prior to the semester of retirement but whose actual date of retirement is not earlier than March 13, 1998; separated from employment or in the case of self-employed, has ceased self-employment, and has paid at least 120 monthly contributions prior to the semester of retirement. 
• Has reached the age of 60 years old whether employed or not. 

Types of Retirement Benefits

Monthly Pension

The monthly pension is a lifetime cash benefit paid to a retiree who has paid at least 120 monthly contributions to the SSS prior to the semester of retirement. 

Lump Sum

The lump sum amount is granted to a retiree who has not paid the required 120 monthly contributions. It is equal to the total contributions paid by the member and by the employer including interest.

In this post, I will be discussing the monthly pension calculation only.

Monthly Pension

Benefit Computation 

The monthly pension depends on the member's paid contributions, his credited years of service (CYS), and the number of his dependent minor children that must not exceed five. The monthly pension will be the highest amount resulting from either one of these three pension formulae:

1. the sum of P300 plus 20 percent of the average monthly salary credit plus two percent of the average monthly salary credit for each credited year of service (CYS) in excess of ten years; or
2. forty (40) percent of the average monthly salary credit; or
3. P1,200, if the CYS is at least 10 but less than 20; or P2,400, if the CYS is 20 or more. 

The monthly pension is paid for not less than 60 months.

A member who retires after age 60 with a total of 120 monthly contributions may be qualified to a monthly pension based on whichever is higher of the following:

• the monthly pension computed at the earliest time the member could have retired had been separated from employment or ceased to be self-employed plus all adjustments thereto; or
• the monthly pension computed at the time when the member actually retires.

A pensioner who retires more than once shall be entitled to the higher of:

• the monthly pension computed for the first retirement claim; or
• the re-computed monthly pension for the new claim

To learn more about SSS Retirement, click here .

Illustration

An employed SSS member with monthly salary of P 30,000.00 and is now 60 years old is eligible to retire after working for 30 years.

Referring to SSS table of contribution, the retiree's contribution is P 581.30 and P 1,208.70 for his employer's contribution. Total contribution of P 1,790.00 per month. This total amount is his average monthly contribution. Thus, his average monthly salary credit (AMSC) falls to P 16,000.00. 

Average total contribution is P 1,790.00 x 30 years x 12 months = P 644,400.00. 

Method 1

Monthly SSS Pension = (AMSC) 20% + (AMSC) 2% for year of service in excess of 10 years + PHP300
Monthly SSS Pension = (P 16,000*20%) + (P 16,000*2%*20 years) + P 300
Monthly SSS Pension = P 3,200 + P 6,400 + P 300
Monthly SSS Pension = P 9,900.00
Method 2

Forty percent (40%) of the average monthly salary credit

Monthly SSS Pension = P 16,000 * 40%
Monthly SSS Pension = P 6,400.00
Method 3

P 1,200, provided that the credited years of service (CYS) is at least 10 or more but less than 20 or P 2,400, if the credited years of service CYS is 20 or more.

Monthly SSS Pension = P 2,400.00 since he has more than 20 credited years of service.

The highest amount among the three methods of computation will be the retiree's monthly pension. Thus, the first computation yields as the highest with P 9,900.00. His monthly pension can be based on this amount.

For him to break-even in his contributions, it will take for at least 5.40 years (65.1 months) to fully benefit from the pension assuming he has not used any of his SSS benefits.

Check out also our online SSS Pension calculator here.

Do you think this amount is enough for your retirement? Share your thoughts on the comment box. :)

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Since we already know howto compute SSS Maternity Benefit, below are the steps on how to avail it. This procedure is applicable for employed member availing the benefit.

Steps:

1.  Notify the HR Department within your 1st trimester that you are pregnant. 

2.  On your 2nd trimester, fill up the SSS Maternity Notification form (SSS MAT-1 form). 

3.  Submit the accomplished hard copy of the form to HR together with Medical Certificate and Latest ultrasound.

4.  Before your 3rd trimester, fill up the SSS Maternity Reimbursement form (SSS MAT-2 form). 

5.  Submit the hard copy form to HR for advance computation together with your maternity leave application. For voluntary member, submit the documents to any SSS branch near you. For OFW, authorization letter is required if applying through a representative. Be sure to file no more than 60 days from the date of conception. But you can still file Maternity Notification even if it’s way over 60 days. For Normal delivery, you’re given 60 days and for Cesarean 78 days of maternity leave. Computation will be based on calendar year which includes Saturday and Sunday. 

6.  The company will prepare the check and pay you in advance in behalf of SSS.

7.  Submit the following requirements to SSS to claim the maternity reimbursement:

a.      SSS digitized ID or two valid government IDs

b.     Duly accomplished SSS MAT 2/Maternity Reimbursement form

c.      MAT 1 form duly stamped by SSS prior to date of childbirth/miscarriage

d.     Certified true copy or original authenticated birth certificate (from NSO) of the child after the delivery

e.      In case of Cesarean delivery, the operating room record or surgical memorandum duly certified by the hospital where the member is confined

f.       In case of Stillbirth, fetal death certificate duly registered with the Local Civil Registrar with a local civil registry number

g.     In case of Miscarriage or Medical Necessary Abortion, pregnancy test before and after miscarriage/ medical necessary abortion, medical certificate/obstetrical history form indicating the number of miscarriages duly certified by the attending physician with his/her license number, printed name and signature, D & C Report for incomplete abortion duly certified by the authorized hospital representative where the member was confined, hystopath report for complete abortion

h.     In case of Separation from Employment prior to release of Maternity Benefits, Certification from the last employer with the effective date of separation 

i.       A copy of approved SSS Form E-5 (for Voluntary Member only)

j.       A copy of approved SSS Form RS-1 (for Self-employed Member only)

8.   For employed member, your maternity benefit will be advanced to you in cash, check or payroll account deposit by your employer, either in full, or in partial amounts before and after your delivery. For voluntary, OFW or self-employed member, your maternity benefit check will be delivered to you in the form of a check via a registered mail, delivered by your postman to the address you wrote in your maternity claim.

9.   Failure to comply with the steps provided means that you will not receive any benefit from SSS and at the same time, no salary will be given to you by the company. 

To know more on how to apply, click here.

IMPORTANT!

• The maternity benefit shall be paid only for the first four (4) deliveries or miscarriages starting May 24, 1997 when the Social Security Act of 1997 (RA8282) took effect.
• For employed members, the benefit is advanced by the employer to the qualified employee, in full, within 30 days from the date of filing of the maternity leave application. The SSS, in turn, shall immediately reimburse the employer 100 percent of the amount of maternity benefit advanced to the female employee upon receipt of satisfactory proof of such payment and legality thereof. If the employee member gives birth or suffers miscarriage without the required contributions having been remitted by the employer, or the employer fails to notify the SSS, the employer will be required to pay to the SSS damages equivalent to the benefits the employee would otherwise have been entitled to.

• For separated/voluntary/self-employed members, the amount of benefit is paid directly to them by the SSS.
• A female member cannot claim for sickness benefit for a period of 60 days for normal delivery or miscarriage or 78 days for caesarean delivery within which she has been paid the maternity benefit. As a rule, no member can be entitled to two benefits for the same period.

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The maternity benefit is a daily cash allowance granted to a female member who was unable to work due to childbirth or miscarriage.

Qualifications

A member is entitled for a maternity benefit if she met the following qualifications:

1.  She has paid at least three monthly contributions within the 12-month period immediately preceding the semester of her childbirth or miscarriage.

2.  She has given the required notification of her pregnancy through her employer if employed, or to the SSS if separated, voluntary or self-employed member.

The maternity benefit is equivalent to 100 per cent of the member’s average daily salary credit multiplied by 60 days for normal delivery or miscarriage, 78 days for cesarean section delivery.

To learn more about SSS Maternity, click here .

Procedure of Computation

Step 1

Exclude the semester of contingency (delivery or miscarriage). Semester of Contingency is used to evaluate if a pregnant woman is qualified for SSS maternity benefit. This is a period of 6 consecutive months, or two consecutive quarters or also called as semester. A quarter refers to three consecutive months.

Step 2

Count 12 months backwards starting from the month immediately before the semester of contingency.

Step 3
Identify the six highest monthly salary credits within the 12-month period.

Monthly salary credit means the compensation base for contributions benefits related to the total earnings for the month.

Step 4
Add the six highest monthly salary credits to get the total monthly salary credit.

Step 5
Divide the total monthly salary credit by 180 days to get the average daily salary credit. This is equivalent to the daily maternity allowance.

Step 6
Multiply the daily maternity allowance by 60 (for normal delivery or miscarriage) or 78 days (for cesarean section delivery) to get the total amount of maternity benefit.

Illustration:

An Employed SSS member is giving birth on December 2014, with maximum monthly contributions (P 581.30 for 2014 and P 500 for 2013).

The semester of contingency that will be excluded for computation will be from July 2014 to December 2014.

The 12-month period before the semester of contingency will be from July 2013 to June 2014. This is also the period where SSS will base their computation.

The six highest monthly salary credits is P 16,000 each (based from P 581.30 monthly contribution using SSS Table). Thus, the total monthly salary credits will be P 96,000 (P 16,000 x 6 months contribution).

The daily maternity allowance will be P 533.33 (P 96,000/180 days).

The total maternity benefit due will be:
P 32,000 (P 533.33 x 60 days) for normal delivery or 
P 41,600 (P 533.33 x 78 days) for cesarean case

Example Scenarios:

Scenario 1: A Voluntary SSS Member is giving birth on December 2014 and pays her premium payments from July 2013 to December 2013 that corresponds to the P 15,000 salary credit (this means, the member is paying the maximum monthly contribution as voluntary member - P 1,560.00 based on the old SSS schedule), after which the member only pays P 550.00 monthly contribution from January to June 2014 which is lower than her previous payments.

The computation of her maternity benefit will be:

The semester of contingency that will be excluded for computation is from July 2014 to December 2014.

The 12-month period before the semester of contingency will be from July 2013 to June 2014. This is also the period that SSS will consider for computation.

The six highest monthly salary credits is P 15,000 each (based from P 1,560 monthly contribution from July 2013 to December 2013, usingthe old SSS Table). Thus, the total monthly salary credits will be P 90,000 (P 15,000 x 6 months contributions).

 

The daily maternity allowance will be P 500.00 (P 90,000/180 days).

The total maternity benefit due will be:
P 30,000 (PHP 500.00 x 60 days) for normal delivery or
P 39,000 (PHP 500.00 x 78 days) for cesarean case

Scenario 2: A Voluntary SSS Member is giving birth on December 2014. The member missed premium payments from July 2013 to December 2013 but have payments from January to June 2014 with corresponding salary credit amounting to P 5,000 (or she has paid P 550 monthly).

The computation of her maternity benefit will be:

The semester of contingency that will be excluded for computation will be from July 2014 to December 2014.

The 12-month period before the semester of contingency will be from July 2013 to June 2014. This is also the period that SSS will consider for computation.

The six highest monthly salary credits is P 5,000 each (based from P 550 monthly contribution from January to June 2014, using new SSS Table). Thus, the total monthly salary credits will be P 30,000 (P 5,000 x 6 months contribution).

The daily maternity allowance will be P 166.67 (P 30,000/180 days).

The total maternity benefit due will be:
P 10,000 (P 166.67 x 60 days) for normal delivery or
P 13,000 (P 166.67 x 78 days) for cesarean case

Scenario 3: An Employed SSS Member is giving birth on December 2014. She have premium payments from July 2013 to September 2013 with P 15,000 salary credit (this means she has paid P 520.00 monthly contribution, based from old SSS schedule). Then, for some reason, the member failed to pay for the succeeding months.

The computation of her maternity benefit will be:

The semester of contingency that will be excluded for computation will be from July 2014 to December 2014.

The 12-month period before the semester of contingency will be from July 2013 to June 2014. This is also the period that SSS will consider for computation.

The six highest monthly salary credits is P 15,000 each (based from P 545 monthly contribution using new SSS Table). Thus, the total monthly salary credits will be P 45,000 (P 15,000 x 3 months contribution).

The daily maternity allowance will be be P 250.00 (P 45,000/180 days).

The total maternity benefit due will be:
P 15,000 (P 250.00 x 60 days) for normal delivery or 
P 19,500 (P 250.00 x 78 days) for cesarean cases.

Since the requirement needs to have at least three (3) months contribution within the 12-month period preceding the semester of contingency, the member still qualifies for the benefit. Also, the higher your monthly contribution payment is, the higher maternity benefit you will get.

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photo: philstar.com

Do you know how your employer compute for your withholding tax? Are they deducting you right? Well, you may check it by calculating manually, with the aid of BIR's Revised Withholding Tax Table. Here's how:

1. Determine the following:

• Monthly Basic Pay (Salary). This does not include your overtime pay/monetary value of your late/tardiness, holiday pay, but includes the monthly allowance you received.
• Status. Single or Married.
• Dependents. Number of qualified dependents/child(ren).

Illustration: 

Employee has a monthly basic salary of P12,000.00.

Employee is Married.

Employee has one qualified dependent.

2. Determine your Taxable Income

Taxable income is the portion of income that is the subject of taxation.

In the Philippines, our taxable income is determined by this formula:

Taxable Income = Gross Taxable Earnings - Non Taxable Deductions 

where:
     Gross Taxable Earnings = Basic Monthly Salary + Overtime Pay + Holiday Pay + Night Differential + Taxable Allowances

     Non Taxable Deductions = Tardiness Deduction + Absences + SSS Contribution + Philhealth Contribution +  HDMF Contribution
   
Please refer to my recent post on how to compute your SSS, PhilHealth and Pag-IBIG Contributions.

Illustration: 
Based from the tables, Employee's contributions are:
     SSS         = P436.00
     PhilHealth = P150.00
     Pag-IBIG = P100.00

Employee's Taxable Income will be:
Taxable Income = P12,000 - (P436 + P150 + P100)
Taxable Income = P12,000 - P686
Taxable Income = P11,314.00

Factors that Increase your tax:

• Overtime Pay
• Holiday Pay
• Night Differential
• Taxable Allowances

Factors that Decrease your tax:

• Late/Tardiness
• Absences
• SSS Contribution
• PhilHealth Contribution
• Pag-IBIG Contribution
• Personal Exemptions (ex. single, head of the family, head of the family with qualified dependents,etc)

3. Compute Withholding using BIR Tax Table

Tax Table

You may download the pdf version here.

Withholding Tax is calculated using the following general formula:

Withholding Tax = [(Taxable Income - Bracket or Exemption) x % Over] + Bracket Tax or Base Tax 

Using the table, you need to determine:

1. The tax schedule. Usually, employers used "Semi-Monthly" and  "Monthly".
2. The row of your STATUS (ex. Single or Married) on the table. "S/ME" means single/married with no dependent, "ME1/S1" means married/single with one dependent, and so on.
3. The greatest number that is less than to your Taxable Income (within the row of your STATUS). This is now your bracket or exemption.
4. Corresponding % Over and Base Tax. From bracket or exemption value, move your eyes vertically upward (on the same column) and look for your corresponding % over and Bracket Tax or Base Tax.

Illustration: 

From the table, Employee's

     1. Tax Schedule = Monthly

     2. Status = ME1

     3. Bracket or Exemption = P8,750.00. This is the highest amount that does not exceed Employee's taxable income of P11,314.00.

     4. % Over = 15%

        Base Tax = P208.33

Tax Computation 1

Using the formula:

Withholding Tax = [(Taxable Income - Bracket or Exemption) x % Over] + Bracket Tax or Base Tax 

Withholding Tax = [(P11,314.00 - P8,750.00) x 15%] + P208.33 

Withholding Tax = [P2,564.00 x 15%] + P208.33 

Withholding Tax = P384.60 + P208.33 

Withholding Tax = P592.93

More Examples

Example 1. Given Employee with Withholding Tax Computed Monthly. Taxable Income: P8558.00. Status: Single

Tax Computation Example 1

Withholding Tax = [(Taxable Income - Bracket or Exemption) x % Over] + Bracket Tax or Base Tax 

Withholding Tax = [(P8,558.00 - P6,667.00) x 15%] + P208.33 

Withholding Tax = [P1,891.00 x 15%] + P208.33 

Withholding Tax = P283.65 + P208.33 

Withholding Tax = P491.98

Example 2. Given Employee with Withholding Tax Computed Monthly. Monthly Basic Salary: P15,000.00. Status: Married with 2 qualified dependents. Overtime Pay: P5,500.00. Taxable Allowance: P3,000.00. Tardiness: P150.00.

Gross Taxable Earnings = Basic Monthly Salary + Overtime Pay + Holiday Pay + Night Differential + Taxable Allowances
Gross Taxable Earnings = P15,000 + P5,500 + P3,000
Gross Taxable Earnings = P23,500.00

Based from the tables, Employee's contributions based from Gross Earnings of P23,500 (This is what most employers practice to decrease employees' withholding tax):
     SSS         = P581.30
     PhilHealth = P287.50
     Pag-IBIG = P100.00

Non Taxable Deductions = Tardiness Deduction + Absences + SSS Contribution + Philhealth Contribution +  HDMF Contribution
Non Taxable Deductions = P150 + P581.30 + P287.50 +  P100.00
Non Taxable Deductions = P1,118.80

Taxable Income = Gross Taxable Earnings - Non Taxable Deductions 
Taxable Income = P23,500.00 - P1,118.80
Taxable Income = P22,381.20

Tax Table Example 2

From the table, Employee's

     1. Tax Schedule = Monthly

     2. Status = ME2

     3. Bracket or Exemption = P20,00.00. This is the highest amount that does not exceed Employee's taxable income of P22,381.20.

     4. % Over = 25%

        Base Tax = P1,875.00

Withholding Tax = [(Taxable Income - Bracket or Exemption) x % Over] + Bracket Tax or Base Tax 

Withholding Tax = [(P22,381.20 - P20,000.00) x 25%] + P1,875.00 

Withholding Tax = [P12,381.20 x 25%] + P1,875.00 

Withholding Tax = P595.30 + P1,875.00

Withholding Tax = P2,470.30

You may download Tax Calculator here. 

Disclaimer: Please check my computations, there might be errors. The calculator file is just a reference I made for quick computation.

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