Clarification on Tax Treatment of Salary Differential in Relation to Maternity Benefits under RA No. 11210

November 4, 2019DOLE DEPARTMENT ADVISORY NO. 001-A-19CLARIFICATION ON TAX TREATMENT OF SALARY DIFFERENTIAL IN RELATION TO MATERNITY BENEFITS UNDER REPUBLIC ACT NO. 11210 OTHERWISE KNOWN AS THE "105-DAY EXPANDED MATERNITY LEAVE LAW"I. PURPOSEThis Labor Advisory is issued to guide all concerned on the proper tax treatment of salary differential to be paid by the employer in favor of female workers in the private sector. HTcADCII. TAX TREATMENTPursuant to Revenue Memorandum Circular No. 105-2019 issued by the Bureau of Internal Revenue clarifying the proper tax treatment of maternity leave benefits under 105-Day Expanded Maternity Leave Law, it is hereby clarified that the salary differential paid by an employer on the basis thereof is exempt from income and withholding taxes. Consequently, concerned women employees shall receive their maternity benefits without any tax deductions.Department Advisory No. 01, Series of 2019 1 in so far as tax treatment of salary differential is concerned, is amended.Be guided accordingly. (SGD.) SILVESTRE H. BELLO IIISecretary Footnotes1. Guidelines on the Computation of Salary Differential of Female Workers during her Maternity Leave and Its...