Published — June 30, 2021
The following post does not create a lawyer-client relationship between Alburo Alburo and Associates Law Offices (or any of its lawyers) and the reader. It is still best for you to engage the services of your own lawyer to address your legal concerns, if any.
Also, the matters contained in the following were written in accordance with the law, rules, and jurisprudence prevailing at the time of writing and posting, and do not include any future developments on the subject matter under discussion.
After reading What are the benefits of being a Pag-Ibig Fund Member, also read Who may register as a member of Pag-Ibig Fund?
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Employer’s contributions are not deductible from the compensation of its employees
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All collected contributions are not taxable
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The members’ contributions shall earn dividends
T here are benefits provided for the members of the Pag-IBIG Fund under Republic Act No. 9679. What are they?
The law says:
First, for employee-members, their employers’ contribution to Pag-IBIG Fund (Fund) cannot be deducted from their compensation.
All contributions collected and all accruals and income or investment earnings from said contributions are exempt from any tax, assessment, fee, charge, or customs, or import duty and all benefit payments made by the Fund are likewise be exempt from all kinds of taxes, fees, or charges. The contributions are not liable to attachments, garnishments, levy, or seizure by or under any legal or equitable process whatsoever.
Also, the member’s contributions, inclusive of employee’s and employer’s contributions, shall earn dividends which shall be distributed annually and credited to his or her Total Accumulated Value (TAV). Only members with outstanding TAV as of year-end shall be entitled to dividends declared for that particular year. All dividend earnings shall be tax-free.
Furthermore, a member shall be entitled to receive his TAV upon the termination of membership, less any and all pending obligations with the Fund. In the event of death, the member’s heirs shall likewise receive the same less any and all pending obligations with the Fund.
In addition, if a member is of good standing, he shall be eligible to apply for housing loans taking into account the ability to pay. He may also avail of the Fund’s various short-term loans and other benefit programs.
What if the employer of a member failed or refused to pay or remit the required contributions?
The law says:
Failure or refusal of the employer to pay or to remit the required contributions shall not prejudice the right of the covered employee to the benefits under the Pag-IBIG Fund. This means that the employee is still entitled to claim or receive said benefits.
Do members have the option to withdraw their contributions?
The law says:
Yes, members have the option to withdraw their Total Accumulated Value on the fifteenth (15th) year of continuous membership provided that they have no outstanding housing loan with the Fund at the time of withdrawal.
Alburo Alburo and Associates Law Offices specializes in business law and labor law consulting. For inquiries, you may reach us at info@alburolaw.com, or dial us at (02)7745-4391/0917-5772207.
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