Payday hits, you open your payslip, and suddenly your sweldo feels like it shrank overnight. The Payslip Deductions line shows SSS here, PhilHealth there, Pag-IBIG in the middle, and the big one: tax. And you look at the numbers thinking, saan napunta yung kalahati? It’s that familiar mix of confusion and worry because you worked hard for every peso.
- 💼 Understanding the Basic Parts of a Filipino Payslip
- 🧮 SSS Contributions Explained: How Your Monthly Deduction Is Computed
- 🏥 PhilHealth Contributions: What Your Deduction Really Means
- 🏡 Pag-IBIG Contributions: Small Monthly Deductions With Big Future Benefits
- 💸 Withholding Tax: Why It’s the Biggest Deduction on Your Payslip
- 📄 Other Common Payslip Deductions You Might See
- 📊 How To Double-Check If Your Payslip Deductions Are Correct
- 📝 When To Ask HR for Clarification (And What To Say)
- 💡 Smart Salary Habits: How Understanding Your Payslip Helps Your Budget
- ❓ Frequently Asked Questions (FAQ)
- 🌅 Why Understanding Your Payslip Gives You Real Financial Control
- 🧾 References
But here’s the thing: understanding your payslip isn’t just curiosity. It’s control. Once you know where each deduction goes and why it’s there, budgeting gets easier, planning feels lighter, and the numbers stop looking like code.
So let’s break down every mandatory deduction clearly, one section at a time, so this payslip finally becomes something you understand, not something that stresses you out.
💼 Understanding the Basic Parts of a Filipino Payslip
Before we even dive into SSS, PhilHealth, Pag-IBIG, and taxes, it helps to know the usual sections you’ll see on a standard payslip. Most companies have different formats, pero the parts are almost always the same. Once you know what each block means, the deductions start to look less mysterious and more logical.
Gross Pay
This is your total earnings before any deductions happen. It includes your basic salary plus whatever else you earned for the cutoff: overtime, night differential, holiday pay, allowances that are taxable, and commissions if applicable. Think of it as your full value for that period.
Earnings Breakdown
Some payslips itemize everything for transparency. You might see:
- Basic Salary (prorated if you have absences)
- Overtime Pay (OT)
- Night Differential (ND)
- Holiday Premiums
- Allowances (taxable or non-taxable)
This section simply shows how your gross pay was built. No tricks. Just math.
Deductions Section
This is the part that usually makes employees frown kasi ang daming bawas. But each line serves a purpose: contributions, taxes, loans, tardiness, or absences. The key is knowing how each number is computed so you can check if everything is correct.
Net Pay
This is what actually lands in your bank account or gets handed to you as cash. It’s the result of:
Gross Pay minus all deductions.
Simple, but this is the number that defines your budget for the next two weeks.
Cutoff Period and Work Details
Some payslips also show the exact dates covered, total hours worked, undertime, leaves used, and adjustments. These details matter when verifying if your salary was computed accurately. One missing day or mis-tagged leave can change the numbers.
Understanding these sections is your starting point. Once this is clear, the rest of the deductions feel easier to decode.. and honestly, more manageable.
🧮 SSS Contributions Explained: How Your Monthly Deduction Is Computed
For most employees, the SSS deduction is the first thing you look at on the payslip. It feels like a small cut every month, pero this one’s long-term. Your SSS contribution builds your safety net for sickness, maternity, disability, retirement, and even salary loans. So knowing how it works gives you more peace of mind.
How SSS Computes Your Contribution
Your contribution depends on your Monthly Salary Credit (MSC). This is a bracket system where your salary is matched to a fixed MSC amount. Then SSS computes your share and your employer’s share based on that bracket.
Here’s the simple idea:
- You pay around 4.5 percent of your MSC.
- Your employer pays 9.5 percent, which is much bigger.
- The higher your salary, the higher your MSC, up to the current SSS ceiling.
Typical Example Based on Salary
Below is a simplified look at what employees usually see.
| Monthly Salary | MSC Used by SSS | Employee Share | Employer Share |
|---|---|---|---|
| 15,000 | 14,500 | 652.50 | 1,377.50 |
| 20,000 | 20,000 | 900.00 | 1,900.00 |
| 25,000 | 25,000 | 1,125.00 | 2,375.00 |
| 30,000 | 30,000 | 1,350.00 | 2,850.00 |
(Figures rounded for easier reading.)
What to Check on Your Payslip
- The SSS deduction should match your salary bracket.
- If your salary changes, your SSS share should update next cutoff.
- If you have SSS salary loans, those repayments appear separately under deductions.
Why It Matters
Each month you contribute adds to your future retirement, benefits, and eligibility for loans. Konting bawas today, malaking tulong later. Understanding how SSS is calculated helps you make sure everything is correct and updated.
🏥 PhilHealth Contributions: What Your Deduction Really Means
PhilHealth deductions sometimes feel confusing because the rates change every few years. But the formula itself is simple. It’s a straight percentage of your monthly salary, shared between you and your employer. Once you understand that, the number on your payslip starts to make sense.. hindi na siya parang random bawas.
The PhilHealth Formula
PhilHealth uses a percentage-based rate applied to your actual monthly salary.
- Current contribution rate: 5 percent
- Salary floor: 10,000
- Salary ceiling: 90,000
- Your share: half of the computed amount
- Employer share: half
So whatever your salary is, PhilHealth gets 5 percent, then divides the result between you and your employer.
Example Computations
Here’s how it plays out for common income levels:
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| Monthly Salary | Computation (5 percent) | Employee Share | Employer Share |
|---|---|---|---|
| 15,000 | 750 | 375 | 375 |
| 25,000 | 1,250 | 625 | 625 |
| 40,000 | 2,000 | 1,000 | 1,000 |
| 90,000 and up | Capped at 4,500 | 2,250 | 2,250 |
If you’re at the ceiling or above, your PhilHealth contribution stays the same every month.
What to Check on Your Payslip
- Make sure the salary used is accurate.
- The deduction should update after salary increases.
- If you’re on unpaid leave for the whole month, check if the employer still remits.
Why This Deduction Matters
PhilHealth covers inpatient and outpatient services, Konsulta packages, surgeries, and even catastrophic illnesses under Z Benefits. Your monthly share might look small, but it can cut hospital bills dramatically when life takes an unexpected turn. And that kind of protection, kahit simple lang, gives you breathing room during tough moments.
🏡 Pag-IBIG Contributions: Small Monthly Deductions With Big Future Benefits
Pag-IBIG is usually the smallest number on your payslip, but ironically, it’s the one that can give you the biggest long-term boost. Housing loans, calamity loans, savings dividends, even the MP2 program.. all of these come from that tiny monthly cut. Kaya it’s worth knowing exactly how your deduction is computed.
How Pag-IBIG Computes Your Monthly Share
Pag-IBIG is straightforward compared to SSS and PhilHealth.
- Employees contribute 2 percent of monthly salary.
- Employers contribute 2 percent as well.
- Contribution is capped at a maximum monthly salary of 5,000.
Meaning:
- The highest employee deduction is 100 pesos.
- The employer matches it with another 100 pesos.
Anything above the cap stays the same. So whether you earn 5,000 or 50,000, your required Pag-IBIG contribution doesn’t increase.
Sample Computations
Here’s how it looks across different salary levels:
| Monthly Salary | Employee Share (2 percent) | Employer Share | Total Savings |
|---|---|---|---|
| 10,000 | 100 (capped) | 100 | 200 |
| 15,000 | 100 (capped) | 100 | 200 |
| 30,000 | 100 (capped) | 100 | 200 |
| 50,000 | 100 (capped) | 100 | 200 |
Simple. Predictable. No surprises.
What to Check on Your Payslip
- Your deduction shouldn’t exceed 100 pesos unless you voluntarily increase it.
- Some companies automatically enroll employees in voluntary top-ups; clarify this if you see more than 100.
- If you took a Pag-IBIG loan (multi-purpose, calamity, or housing), those repayments appear under a separate line.
Why This Deduction Matters
That small 100 pesos goes a long way. It grows your Pag-IBIG Regular Savings, earns dividends yearly, and unlocks access to loans and affordable housing. Maraming employees overlook this, but when you finally need a big loan someday, this little contribution becomes your stepping stone.
💸 Withholding Tax: Why It’s the Biggest Deduction on Your Payslip
Among all the entries on your payslip, withholding tax is usually the one that hits the hardest. It’s also the most misunderstood. Employees see a big number missing from their sweldo and wonder if the company computed it right.. or if the government took too much again. Pero once you understand how taxes are computed under the TRAIN Law, the numbers start to feel more logical.
How Withholding Tax Is Computed
Your employer uses the TRAIN withholding tax table, which is based on your monthly taxable income.
Here’s the formula in simple terms:
- Start with gross pay.
- Subtract non-taxable amounts (de minimis benefits, some allowances).
- The result is your taxable income.
- Apply the TRAIN tax bracket:
- 0 percent for the first 20,833
- Anything above that gets a percentage plus a fixed amount depending on the bracket.
You don’t compute this manually every payday, but knowing the tiers helps you check if the numbers are reasonable.
Sample Computations Based on Salary
Here’s a simplified look:
| Monthly Taxable Income | TRAIN Tax Computation | Approx. Tax Deduction |
|---|---|---|
| 18,000 | Below threshold | 0 |
| 25,000 | 0 + 20 percent | 834 |
| 35,000 | 2,500 + 25 percent | 3,333 |
| 55,000 | 8,750 + 30 percent | 9,250 |
(Rounded values for easier reading.)
If your taxable income stays the same each month, your tax deduction should stay consistent. If it suddenly jumps, check if there were taxable allowances or adjustments you missed.
What to Check on Your Payslip
- Your taxable income should be visible or computable based on earnings minus non-taxable items.
- If you receive bonuses, the tax treatment follows separate rules, so deductions may spike.
- Tax should adjust after salary increases or after changes in benefits.
- If you have no taxable income, you should not be taxed at all.
Why Tax Matters (Even If It Hurts)
Nobody likes seeing tax deductions, but they fund healthcare, roads, public schools, and government services. And under TRAIN, many employees now pay significantly less than before. Konting sakit sa sweldo, pero at least predictable and transparent.
Understanding how tax is computed gives you confidence that your payslip is correct and that you’re not losing money unfairly.
📄 Other Common Payslip Deductions You Might See
Aside from the mandatory contributions, most employees notice a few extra lines on their payslip. Sometimes they look random, minsan nakaka-raise ng eyebrow, but they often have simple explanations. These items vary per company, but the goal is transparency so you always know what was deducted and why.
Company Loans and Cash Advances
If you availed a salary loan, gadget loan, uniform loan, or any company-sponsored financing, repayments appear here. They’re usually fixed monthly amounts.
- Check the remaining balance.
- Make sure the deductions match the agreed schedule.
Tardiness and Undertime
If you clocked in late or left early, you may see hourly or minute-based deductions.
- Companies compute this by dividing your salary by the number of working days or hours per month.
- If you feel the amount is off, review your timekeeping logs.
Absences (Without Pay)
If you used up all your leave credits, absences become LWOP (leave without pay).
This deduction is straightforward:
- Daily rate x number of days absent.
Government Loans
If you have active loans with SSS or Pag-IBIG:
- SSS Salary Loan repayments are fixed per month.
- Pag-IBIG MPL or Calamity Loan deductions also follow a fixed schedule.
These appear under a separate section so they don’t mix with your regular contributions.
Benefits and Allowance Adjustments
Some allowances are taxable; others are not. You might see items like:
- Meal allowance
- Transportation allowance
- Cola
- Performance or project bonuses
- Taxable benefits above de minimis ceilings
If the allowance is taxable, your withholding tax changes for that cutoff.
Health Insurance or HMO
Some companies deduct a portion of your HMO premium.
- Check your employee handbook to confirm if the company shouldered it or if it’s shared.
These smaller items might feel confusing at first glance, but once you understand the pattern, they’re just part of the usual payroll flow. Having a clear picture of these deductions helps you spot discrepancies and protect your hard-earned sweldo.
📊 How To Double-Check If Your Payslip Deductions Are Correct
Most employees never question their payslip. You work, you get paid, tapos. But mistakes happen – wrong timekeeping entries, outdated SSS brackets, missed allowances. And it’s your salary on the line. Doing a quick audit every cutoff helps you catch errors early and avoid bigger issues later on.
Step 1: Verify Your Gross Pay
Start with what you should have earned.
- Check your basic salary for the period.
- Add OT, night diff, holiday pay, commissions, or allowances.
If this number is off, every deduction after will be off too.
Step 2: Confirm Required Government Deductions
Check each mandatory item:
- SSS – matches your MSC bracket
- PhilHealth – matches 5 percent rate and salary cap
- Pag-IBIG – should never exceed 100 pesos unless voluntary
- Tax – consistent with your taxable income
If any of these don’t match expectations, ask HR or payroll immediately.
Step 3: Review Timekeeping vs Deductions
If you see tardiness, undertime, or LWOP deductions, match them with your logs.
- Check your biometric timestamps.
- Make sure adjustments match the minutes or days deducted.
Step 4: Look for Repeated or Unknown Deductions
Sometimes a deduction continues longer than it should.
- Completed loans still showing
- HMO deducted even when fully employer-paid
- Allowances deducted twice
- Old rates that didn’t update after a salary increase
These are easy to miss but important to correct.
Step 5: Compare Cutoffs
A good habit is to compare payslips across months.
- Did anything change unexpectedly?
- Are deductions consistent?
- Did a sudden spike happen due to a taxable benefit?
Small red flags often appear this way. Just a bit of checking can save you thousands over the years. And knowing how everything works feels empowering – parang hawak mo ulit yung sweldo mo.
📝 When To Ask HR for Clarification (And What To Say)
Even if your payslip looks straightforward, there will be times when something feels off. And that’s normal. Payroll teams handle hundreds of entries every cutoff, so errors can slip in. What matters is knowing when you should raise a concern and how to ask clearly so the issue gets resolved fast.
Situations When You Should Definitely Ask
Here are the moments when reaching out to HR or payroll is not just okay – it’s necessary.
- Deductions suddenly increased without explanation
- Your SSS, PhilHealth, or Pag-IBIG deduction doesn’t match updated rates
- Your timekeeping shows you worked, but the payslip marks LWOP
- A loan repayment continues after it should be fully paid
- Allowances (like meal or transpo) didn’t reflect in your earnings
- Your net pay is lower than usual and you can’t find the reason
- A taxable benefit appears that you didn’t receive
If any of these show up, don’t wait until the next cutoff. Payroll corrections are easier when you ask early.
What To Say (Simple Template You Can Copy)
Use this when emailing or messaging HR:
Subject: Payslip Clarification – [Your Name], [Cutoff Period]
Message:
Hi [HR/Payroll],
I reviewed my payslip for the cutoff [date] and noticed a possible discrepancy in the [specific deduction or earning]. Can you please help check the computation? I attached a screenshot of the payslip for reference.
Thank you.
Short. Clear. Professional. Walang drama, walang gulo.
What To Prepare Before Messaging
To avoid back-and-forth:
- Screenshot of your payslip
- Timekeeping logs (if relevant)
- Any previous communications about loans or allowances
- Your employee ID number
When you come prepared, HR can resolve the issue quickly instead of guessing what went wrong.
Why This Matters
A payslip seems simple, pero it’s a legal record of your work and your compensation. One wrong deduction can snowball if you don’t address it. Asking questions isn’t being “maarte.” It’s being responsible with your money. And honestly, companies appreciate employees who keep things accurate.
💡 Smart Salary Habits: How Understanding Your Payslip Helps Your Budget
Once you finally understand every line on your payslip, something shifts. You stop guessing, stop assuming, and start planning with intention. Your salary isn’t just a number anymore. It becomes a tool. And with a bit of diskarte, you can stretch it further, avoid surprises, and build a more stable financial routine.
Build a Cutoff-Based Budget
Most Filipino employees get paid twice a month. Instead of thinking monthly, try planning your money per cutoff.
- All recurring bills? Assign them to specific cutoffs.
- Groceries? Keep them on one cycle so it’s predictable.
- Savings? Automatically allocate a percentage right after payday.
This removes the feeling of being “short” at random points of the month. Parang may rhythm yung pera mo.
Track Your Deductions Over Time
Payslip numbers change based on your situation.
- Salary increases
- Promotions
- Additional allowances
- New loans
- Updated contribution rates
When you track changes, you understand how every life decision affects your take-home pay. It also helps you spot mistakes earlier.
Automate Your Savings
After deductions, your net pay becomes your real raw material. Automating small savings removes the pressure of deciding every payday.
Options you can automate:
- Bank auto-transfers
- Pag-IBIG MP2 contributions
- GCash GSave or other e-wallet savings
- Personal emergency fund
Even small amounts matter because they grow quietly in the background.
Keep a Simple Money Log
You don’t need a complicated spreadsheet. Just a small notebook or phone app listing:
- Salary received
- Key deductions
- Major expenses
- Savings made
After a few months, patterns appear. You start seeing where money flows and where things leak. That awareness leads to better choices.
Why This Helps
When you understand your payslip, you stop living in fear of deductions and start using them to your advantage. You plan smarter, spend calmer, and feel more in control of your financial life. Kahit simple lang, that stability adds a different kind of peace every cutoff.
❓ Frequently Asked Questions (FAQ)
1. Why do my SSS, PhilHealth, and Pag-IBIG deductions change even if my salary doesn’t?
Deductions may change when the government updates contribution rates or when your employer adjusts the declared salary used for computations. PhilHealth in particular updates its ceiling from time to time, which affects your share. Sometimes bonuses or taxable allowances also affect tax and other deductions for that cutoff. If changes feel unusual, it’s good to ask HR to review the breakdown.
2. Why is my tax deduction higher this month?
Tax increases when your taxable income increases due to allowances, overtime, or bonuses. Even a small taxable benefit can push you into a higher tier under the TRAIN tables. This doesn’t mean your employer made a mistake; it means the total taxable income for that cutoff changed. Compare this period with the previous one to see what caused the jump.
3. What should I do if my payslip deduction looks wrong?
Start by checking your time logs, previous cutoffs, and the required government rates. Sometimes it’s just a mis-tagged leave or outdated salary bracket. If the numbers don’t add up after reviewing, message HR with a screenshot and clear notes about what looks incorrect. This helps them verify and fix it faster.
4. How can I compute my SSS contribution manually?
Check your Monthly Salary Credit (MSC) in the SSS contribution table, then multiply it by the employee share percentage. The employer contribution is based on the same bracket. SSS publishes updated tables whenever changes are made, so make sure you’re using the latest one. Manual computation helps you check if your payslip is accurate.
5. Why does PhilHealth use a salary ceiling?
PhilHealth sets a minimum and maximum salary to simplify contributions and make them fair for both low-income and high-income workers. Even if you earn above the ceiling, your contribution will not increase past the capped amount. This system helps stabilize the fund while keeping deductions predictable for employees.
6. Can I increase my Pag-IBIG contribution?
Yes, voluntary top-ups are allowed and you can increase it anytime. Higher contributions help your regular savings grow and may improve your dividend earnings. Some employees increase their Pag-IBIG savings to prepare for MP2 or future housing loan applications. Just coordinate with HR if you want to request additional deductions.
7. Why do I still see a Pag-IBIG or SSS loan deduction even though I finished paying it?
This usually happens when payroll hasn’t updated the loan status yet. It’s a common delay when cutoff schedules are tight. Contact HR, provide your loan documents or previous payslip, and request verification of the remaining balance. Refunds or adjustments can be applied in the next payroll if needed.
8. Why does my net pay differ even if my gross pay is the same?
Net pay changes depending on deductions, taxable allowances, and timekeeping adjustments. If you had tardiness, late credits, or additional benefits, your total deductions will shift, affecting your take-home pay. Even a small taxable benefit or absence can create visible changes in net pay.
9. How often do government deduction rates change?
SSS, PhilHealth, and Pag-IBIG may update their rates every few years or based on new laws. For example, PhilHealth’s premium rates have been gradually increasing. It’s a good habit to check updates once or twice a year so you’re aware of how changes affect your salary. Government websites usually publish new tables before implementation.
10. Is it possible for my payslip to show zero tax?
Yes. If your monthly taxable income is below the TRAIN threshold of 20,833 pesos, your tax deduction becomes zero. This applies to many entry-level employees or those with mostly non-taxable allowances. A zero-tax month is normal as long as the computation aligns with your taxable income and benefits.
🌅 Why Understanding Your Payslip Gives You Real Financial Control
When you finally stop guessing and start understanding your payslip, something shifts quietly but powerfully. You begin to see your salary not as a fixed number, but as a living thing shaped by your work, your benefits, your time, and your goals. The deductions stop feeling like surprises. The numbers stop feeling intimidating. And suddenly, budgeting becomes clearer, calmer, more intentional.
Most of us grew up just accepting whatever was printed on that tiny slip of paper. Pero once you learn to read it, you reclaim control over your own money. You catch errors before they hurt you. You plan your expenses around real numbers, not gut feel. You start making smarter decisions because you finally understand the flow of your income.
It’s a small skill with a big impact. Payslip awareness leads to better budgeting, better saving habits, and better financial confidence. And that confidence? It builds a safer, steadier life for you and your family. Step by step, cutoff by cutoff.
