Automate payroll in Philippines with Al-powered calculations, local SSS + PhilHealth + Pag-IBIG (HDMF) handling, and compliant payslips generated in seconds.
Establish credibility and match buyer objections: compliance, local knowledge, pricing clarity, and support.
Local Compliance Without Local Overhead: Ontop automates Philippines tax calculations and Collective Bargaining Agreement (CBA) requirements so you avoid setting up a local entity. The platform handles 13th Month Pay payments, wage floors, and regional tax variation to keep payroll compliant and predictable. Transparent Pricing And Fees: Pricing clearly shows payroll fees, exchange rates, and contractor or EOR plan costs before payment.
Finance teams get predictable statements with no surprise charges. Human Support When It Matters: Live support helps resolve local queries and edge cases. Dedicated onboarding specialists guide tax registration and social security setup so teams move from hire to pay faster. Global Coverage With Philippines Expertise: Ontop supports hiring across 150+ countries while providing Philippines-specific workflows. Proration for 13th Month Pay, Collective Bargaining Agreement (CBA) compliance, and Bureau of Internal Revenue (BIR) deadline management. Scale globally while keeping local accuracy.
Provide fast facts: minimum wage, pay frequency, bonuses, regional salary ranges. Satisfies informational intent and helps long-tail SEO.
Minimum Wage And Pay Frequency: Philippines's minimum wage is PHP 700/day (Metro Manila NCR 2026) Daily. With 13th Month Pay, annual total reaches the statutory requirements. Many employers pay Mandatory - 1/12 of total basic salary earned during the year or prorate into Monthly / Semi-monthly payments. Ontop supports both structures.
Average Salary And Net Take Home: National average salary is ~PHP 420,000 per year, about ~PHP 35,000 per month gross. Ontop displays gross-to-net breakdowns so payroll and offers align with local expectations.
Regional Variation To Budget For: Salaries run higher in Metro Manila and Cebu. Metro Manila averages PHP 40,000 - 120,000 (~40%% above national). Cebu around PHP 30,000 - 80,000 (~15%%). Ontop lets you model regional differences in offers and cost projections.
13th Month Pay: Philippines commonly provides Mandatory - 1/12 of total basic salary earned during the year. Payroll logic captures proration rules so payslips match local contract terms.
Philippines's wage structure includes Collective Bargaining Agreement (CBA) that set sectoral minimums. Buyers search "minimum wage by sector," "CBA wages." Captures mid-funnel research intent.
National Statutory Minimum Wage: Philippines's national minimum wage is PHP 700/day (Metro Manila NCR 2026) Daily. Applies to all workers unless a higher sectoral minimum applies. Revised annually.
Collective Bargaining Agreement (CBA) Sectoral Minimums: Philippines has multiple active Collective Bargaining Agreement (CBA) agreements covering specific sectors. These set minimums higher than the statutory minimum depending on industry and role. Sectors include key local industries.
How Sectoral Wage Floors Affect Payroll: If an employee falls under a specific CBA, you must pay the sectoral minimum. Underpaying triggers wage claims, back pay, and penalties. Ontop stores and applies the correct rate based on employee role and sector.
How Ontop Applies Correct Wage Floors: Ontop maintains an updated CBA database and automatically applies the correct minimum wage. During payroll preview, the system displays which agreement applies and confirms compliance. Removes manual compliance risk.
National Average Salary Benchmark: Colombia's national average salary is approximately ~PHP 420,000 per year. Varies by role, experience, and sector. Larger cities run up to 20% higher; rural regions typically align with the statutory minimum.
High-Cost Cities: Metro Manila and Cebu: Metro Manila offers salaries ~40%% above national average, particularly in tech and finance. Typical range: PHP 40,000 - 120,000 annually for mid-level roles. Cebu offers ~15%% premium with strength in innovation and services. Typical range: PHP 30,000 - 80,000.
Secondary Cities and Regional Variation: Secondary cities generally sit between 5% to 10% above the national average, depending on local industries. Rural regions typically align with or fall below the national average. When budgeting for diverse teams, account for market research to ensure equitable offers.
How Ontop's Cost Calculator Handles Regional Modeling: Input location and role to preview total employer cost. See how regional differences, wage floors, and benefits combine to show true cost of employment by city.
Buyers search "contract types Philippines," "permanent vs fixed-term." Legal structure and misclassification risk are critical for compliance.
Permanent Full-Time Employment (Regular Employment (Permanent)): Standard indefinite contract with full statutory protections. Employees get all mandatory benefits (13th Month Pay, Annual Leave / SIL, sick leave, maternity leave, Separation Pay). Termination requires just cause or economic redundancy with notice and severance payout. Employer SSS + PhilHealth + Pag-IBIG (HDMF) contributions typically ~12.5% employer (SSS ~8.5% + PhilHealth 5% / 2 + Pag-IBIG 2%)%.
Fixed-Term Contracts (Fixed-Term / Project-Based): Limited-duration contracts (typically for a fixed period, renewable). Used for project work, seasonal roles, or temporary needs. Same taxes and benefits as permanent, but with defined end date. Subject to renewal restrictions and CBA rules. Simpler termination but accrued benefits paid in full.
Part-Time Contracts: Reduced hours subject to local statutory limits. Salary and benefits are prorated by hours worked. SSS + PhilHealth + Pag-IBIG (HDMF) and taxes apply pro-rata. Ontop handles prorated 13th Month Pay automatically.
Apprenticeships: Training contracts for students or junior profiles with reduced SSS + PhilHealth + Pag-IBIG (HDMF) contributions where applicable. Includes structured training and on-the-job learning. Misclassification can trigger reclassification penalties.
Self-Employed / Independent Contractor / Freelancer: Independent contractor operating own business. No employer obligations, only invoice payments. Contractor handles own SSS + PhilHealth + Pag-IBIG (HDMF), taxes, invoicing. Critical: if worker appears to be employee (direction, control, exclusivity), you face reclassification and back-pay exposure.
Compliance Differences Between Contract Types: Tax rates, SSS + PhilHealth + Pag-IBIG (HDMF) contributions, benefits, termination rules, and Separation Pay accrual vary by type. Misclassification triggers wage claims, penalties, and reclassification costs.
How Ontop Templates & Payroll Logic Handle Each Type: Ontop provides compliant templates for each type and applies correct payroll logic: permanent benefits, fixed-term accruals, part-time prorations, apprenticeship rates, and Independent Contractor / Freelancer invoicing. Avoids misclassification risk.
Explain operational flow from onboarding to monthly payments. Reduces friction and clarifies steps.
Onboarding And Registration: Ontop handles registration with Philippines tax authorities (Bureau of Internal Revenue (BIR)) and SSS + PhilHealth + Pag-IBIG (HDMF) and collects required IDs. Automation plus human verification reduces setup time and avoids compliance gaps. Typical onboarding: a few business days.
Monthly Payroll Calculation: Gross-to-net includes progressive 0% up to PHP 250,000 / 15% / 20% / 25% / 30% / 35% tax rates, ~8.5% employee (SSS ~4.5% + PhilHealth 5%/2 + Pag-IBIG 1-2%) + income tax% SSS + PhilHealth + Pag-IBIG (HDMF), and 13th Month Pay proration. Platform applies region-specific tax bands, CBA rules, and wage floors for accurate payslips.
Contributions And Filings: Employer contributions include SSS + PhilHealth + Pag-IBIG (HDMF) (~8.5% employee (SSS ~4.5% + PhilHealth 5%/2 + Pag-IBIG 1-2%) + income tax) and applicable local surcharges. Submitted according to statutory deadlines to SSS + PhilHealth + Pag-IBIG (HDMF) on your behalf. Ontop maintains records for annual reconciliation.
Payment Execution And Reconciliation: Payments in PHP ₱ (Philippine Peso) via local bank transfers to local accounts. Ontop shows conversion rates and fees before approval. Audit-ready receipts and instant USD payout options available.
EOR Vs Independent Contractor / Freelancer: Your Options: Choose Independent Contractor / Freelancer plans for flexible work or full EOR for permanent employees. Ontop supports both and highlights compliance differences so you pick the right structure.
Finance teams search "Philippines payroll deadline." Captures operational queries and establishes Ontop as deadline-management partner.
Monthly Tax Withholding & SSS + PhilHealth + Pag-IBIG (HDMF) Payment Deadlines: Bureau of Internal Revenue (BIR) tax withholding due April 15 (Annual ITR 1700/1701) via Bureau of Internal Revenue (BIR) online portal. SSS + PhilHealth + Pag-IBIG (HDMF) contributions due Monthly SSS/PhilHealth/Pag-IBIG by deadlines per agency to SSS + PhilHealth + Pag-IBIG (HDMF) authority. Late payments trigger Late SSS: 3% monthly surcharge; late PhilHealth: 2% monthly; late BIR: 25% surcharge + 12% annual penalty plus interest.
Annual Compliance Deadlines: Monthly contribution filings to SSS, PhilHealth, Pag-IBIG: annual SSS + PhilHealth + Pag-IBIG (HDMF) reconciliation, due Per agency deadlines. Annual Income Tax Return (1700/1701): due April 15. BIR Form 2316 (Certificate of Withholding): annual employee tax certificate due By January 31.
Payroll Processing Calendar (Monthly Example):
Semi-monthly or monthly payroll - SSS/PhilHealth/Pag-IBIG filings - 13th month December - BIR 2316 January. Key Regulatory Bodies & Filing Channels: Bureau of Internal Revenue (BIR):
Income tax and withholding. Online filing via official portals.
SSS (Social Security System): Social security.
DOLE (Department of Labour and Employment): Labor law enforcement.
Penalties for Non-Compliance: Late Bureau of Internal Revenue (BIR) remittance:
Late SSS: 3% monthly surcharge; late PhilHealth: 2% monthly; late BIR: 25% surcharge + 12% annual plus interest. SSS + PhilHealth + Pag-IBIG (HDMF) shortfalls result in fines. Missing documentation increases audit exposure. Audit exposure increases with missing filings. Willful violations can trigger criminal liability.
How Ontop Manages Deadlines Automatically: Ontop tracks all compliance deadlines, sends alerts before due dates, and submits filings automatically. Finance team approves payroll ahead of deadlines. All documentation audit-ready.
Buyers search "how much leave Philippines," "maternity leave," "paid leave entitlements." Impacts total cost of employment and satisfies planning intent.
13th Month Pay (December 24): All permanent employees entitled to Mandatory - 1/12 of total basic salary earned during the year. Typically paid in December 24, or prorated across year. Statutory bonus, not discretionary. Must factor into annual payroll cost.
Annual Leave / SIL: Minimum 5 days Service Incentive Leave (SIL) minimum; sector CBAs grant more of paid vacation annually. Unused leave carryover varies by CBA. Some allow unlimited carryover; others limit carryover. Leave paid at regular rate upon termination if unused.
Sick Leave: Statutory sick leave paid at No mandatory statutory sick pay beyond SIL; employer policies vary. Medical certification required after a few consecutive days as per local law. SSS + PhilHealth + Pag-IBIG (HDMF) may provide supplementary coverage for longer absences.
13 weeks (78 days) maternity (up to 105 days - RA 11210) of maternity leave. Paid at SSS Maternity Benefit (full salary equivalent from SSS) by the local health entity. Additional parental leave may apply.
Public Holidays: Philippines observes ~12 regular + 3 special public holidays national holidays annually. Employees receive full pay or premium pay if required to work. Regional variations exist. Separation Pay: Permanent employees receive 0.5 to 1 month per year depending on cause; 1 month per year for authorized causes when terminated without just cause. Separation Pay is a significant liability, must be accrued regularly and paid in full at termination.
How Ontop Automates Benefit Accrual & Compliance: Ontop automatically calculates 13th Month Pay, leave balances (by CBA type), maternity deductions, and Separation Pay reserves. Payslips show accruals and deductions clearly. Audit-ready.
Decision makers need concrete cost inputs. Provide contribution ranges, deduction rates, and sample calculations for budget decisions.
Employer SSS + PhilHealth + Pag-IBIG (HDMF) And Additional Charges: Employer SSS + PhilHealth + Pag-IBIG (HDMF) varies by sector and contract. Approximate rates:
Employee Deductions And Tax Bands: Employee deductions include ~8.5% employee (SSS ~4.5% + PhilHealth 5%/2 + Pag-IBIG 1-2%) + income tax% SSS + PhilHealth + Pag-IBIG (HDMF) and progressive Bureau of Internal Revenue (BIR) tax: 0% up to PHP 250,000 / 15% / 20% / 25% / 30% / 35% Regional/local taxes may add extra percentages.
Total Employer Cost Example: Scenario: Permanent employee in Metro Manila at PHP 50,000 gross/month/month gross.
For annual planning, expect the total employer cost to be roughly ~12.5% above gross above the gross salary, plus applicable statutory accruals for benefits.
Clarify payment rails, currency handling, and worker features that influence adoption and retention.
Local PHP ₱ (Philippine Peso) Transfers And Pay Runs: Payroll in Philippines typically uses PHP ₱ (Philippine Peso) payments via local bank networks to local accounts. Ontop supports local rails so workers receive funds on payday in a single auditable run. No conversion friction.
Multi-Currency And Dynamic Conversion: When paying from other currencies, Ontop shows rates and fees before confirmation. Finance leaders get transparent previews. All conversions logged for audit.
Ontop Wallet And Instant USD Payouts: Workers receive USD via Ontop wallet backed by U.S. bank for fast access. Instant payouts reduce waiting times. Visible on worker dashboard and app. Useful for remote workers or USD preference.
Visa Debit And Worker Perks: Ontop issues Visa cards (physical or virtual) for immediate fund access. Security controls (instant freeze, limits) and perks (cashback, travel benefits, reduced transfer fees).
Buyers search "Philippines payroll mistakes," "how to avoid penalties." Fear-based content drives conversions.
13th Month Pay Miscalculation
Risk Level: HIGH
Philippine 13th month pay is 1/12 of total basic salary earned during the calendar year - not gross salary, not including allowances. Many employers calculate on the current monthly salary without accounting for mid-year hires, separations, or salary changes. DOLE inspections routinely find underpayment. Ontop calculates 13th month based on actual basic salary earned per month throughout the year.
Employee vs Contractor Misclassification (Labor-Only Contracting)
Risk Level: HIGH
Philippine law prohibits labor-only contracting - engaging workers through a third-party agency that has no substantial capital and the workers perform the main business of the principal. DOLE orders direct employment regularization with full back-benefits. Ontop distinguishes legitimate job contracting from prohibited labor-only contracting and provides compliant EOR solutions.
Ontop supports payroll for both contractors and employees in Philippines. The platform provides contractor (Independent Contractor / Freelancer) contract templates and full EOR services for employees so you can choose the structure that fits compliance and operational needs.
Ontop applies local employer contribution rules (typically around ~8.5% employee (SSS ~4.5% + PhilHealth 5%/2 + Pag-IBIG 1-2%) + income tax) and sector-specific rates when calculating payroll liabilities. The system presents a clear breakdown of employer charges during payroll preview so you know the total cost before approval.
Yes, mandatory bonus structures like 13th Month Pay are common. The standard structure is Mandatory - 1/12 of total basic salary earned during the year, usually paid in December 24 or prorated across the year. Ontop supports both approaches and reflects proration on employees' payslips and in cost projections.
Employees typically see SSS + PhilHealth + Pag-IBIG (HDMF) deductions around ~8.5% employee (SSS ~4.5% + PhilHealth 5%/2 + Pag-IBIG 1-2%) + income tax and progressive Bureau of Internal Revenue (BIR) income tax withholding between 0% up to PHP 250,000 / 15% / 20% / 25% / 30% / 35% depending on income bracket and region. Ontop calculates and withholds the correct amounts based on salary, location, and personal circumstances.
Yes, Ontop provides cost previews that include employer contributions, taxes, statutory charges (like Separation Pay accruals), and regional variation. Use these previews to budget hires accurately and compare contractor versus employee scenarios.
No. Ontop can operate as your Employer of Record (EOR), handling all legal employer responsibilities and registrations. You avoid the complexity and cost of setting up a local company. Alternatively, if you have an entity, Ontop can serve as your payroll processor.
Common risks include misclassifying employees as contractors, missing Bureau of Internal Revenue (BIR) payment deadlines, and failing to adhere to Collective Bargaining Agreement (CBA) rules. Ontop's automation and expert support mitigate these risks.
