Pag-IBIG Contribution Philippines: Rates, Deadlines and Employer Duties
Last materially reviewed: August 24, 2026
Every employee covered by the SSS or the GSIS is automatically a Pag-IBIG member, and both the employee and the employer must contribute every month. Since February 2024 the salary base used in the computation has been capped at ₱10,000, which puts the standard maximum at ₱200 from the employee and ₱200 from the employer.
Need the definition only? See Pag-IBIG Contribution meaning in the LaborCode.ph Glossary. This guide covers rates, computation, remittance deadlines, penalties and what happens when an employer fails to remit.
The figure most people remember — ₱100 — comes from the ceiling printed in the statute itself. That ceiling was doubled by the Fund’s Board of Trustees without any amendment to the law, which is why reading Republic Act No. 9679 alone produces the wrong answer.
Direct Answer
Under Section 7 of Republic Act No. 9679, an employee earning more than ₱1,500 a month contributes 2% of monthly compensation and the employer contributes 2%, computed on a capped salary base. HDMF Circular No. 460 raised that cap — the Maximum Fund Salary — from ₱5,000 to ₱10,000 effective February 2024.
The practical result for most employees is ₱200 deducted from the payslip and ₱200 paid by the employer, for a total of ₱400 credited to the member every month.
Legal Basis
Statute: Republic Act No. 9679, the Home Development Mutual Fund Law of 2009. Section 6 makes coverage mandatory on all employees covered by the SSS and the GSIS and on their employers. Section 7 fixes the contribution rates and the statutory salary ceiling, and expressly allows the Board of Trustees to move that ceiling.
Current ceiling: HDMF Circular No. 460, signed 15 January 2024 and effective February 2024, raised the Maximum Fund Salary from ₱5,000 to ₱10,000. The Department of Budget and Management confirmed the change in Circular Letter No. 2024-2 of 1 February 2024.
Remittance and penalties: HDMF Circular No. 275 sets the staggered remittance schedule and the daily penalty for delay. Section 23 of Republic Act No. 9679 governs the duty to remit, the statutory penalty and collection; Section 25 supplies the criminal penalties.
Decision Snapshot
| Question | Practical answer |
|---|---|
| Who this applies to | All employees covered by the SSS or the GSIS, and their employers. Coverage under Section 6 is mandatory and automatic — there is no minimum length of service, no waiver and no opt-out. |
| Core rule | Employees earning more than ₱1,500 a month contribute 2%; those earning ₱1,500 or less contribute 1%. Every employer contributes 2%, whatever the employee earns. Both are computed on monthly compensation capped at the Maximum Fund Salary, currently ₱10,000. |
| Main boundary | The employer’s 2% share is the employer’s own cost. Section 7 forbids deducting it, directly or indirectly, from the employee’s compensation. A payslip showing ₱400 withheld from the employee for Pag-IBIG is wrong on its face. |
| Key evidence | Payslips showing the Pag-IBIG deduction, the member’s posted contribution record, the employment contract, and the employer’s remittance receipts. A gap between what the payslip shows as deducted and what is posted to the member record is the practical trigger for raising the issue. |
| Deadline / rate / period | Standard maximum ₱200 employee plus ₱200 employer. Remittance deadlines are staggered by the first letter of the employer’s registered name, from the 10th to the end of the following month. Under Section 23(e) an action to collect unpaid contributions may be brought within twenty years from the time the delinquency is known. |
| First next step | Compare the Pag-IBIG deduction on your payslip against your posted contribution record. If amounts were deducted but not posted, the employer — not the member — bears the shortfall, together with interest, penalties and the dividends the money would have earned. |
Key Takeaways
| Question | General rule |
|---|---|
| Employee rate, earning over ₱1,500 | 2% of monthly compensation |
| Employee rate, earning ₱1,500 or less | 1% of monthly compensation |
| Employer rate | 2%, regardless of what the employee earns |
| Salary base cap | ₱10,000 Maximum Fund Salary since February 2024 |
| Standard maximum per month | ₱200 employee + ₱200 employer = ₱400 |
| Deducting the employer share from wages | Prohibited by Section 7 |
| Contributing above the maximum | Allowed voluntarily by the member |
| Employer failed to remit | Member benefits are preserved under Section 23(d); liability rests with the employer |
Jump to a Section
- What the Pag-IBIG Contribution Is
- Who Is Covered
- The Statutory Rates
- The Salary Cap and Why the Statute Understates It
- How to Compute the Contribution
- What the Employer Cannot Do
- Remittance Deadlines
- Penalties for Late or Non-Remittance
- If Your Employer Did Not Remit
- Criminal Liability
- Employer Compliance Checklist
- Frequently Asked Questions
- Sources
What the Pag-IBIG Contribution Is
The Pag-IBIG contribution is the mandatory monthly payment to the Home Development Mutual Fund, shared between the employee and the employer. It is a savings contribution rather than a tax: the amounts credited to a member accumulate, earn dividends declared by the Fund, and are payable to the member on maturity or on the occurrence of a qualifying event.
That distinction matters when an employer fails to remit. Unremitted contributions are not merely a compliance problem — they are money that should have been accumulating in the member’s name and earning a return.
Who Is Covered
Section 6 of Republic Act No. 9679 states that coverage in the Fund “shall be mandatory upon: (a) all employees covered by the SSS and the GSIS, and their respective employers.”
Coverage is therefore derivative and automatic. If an employee is covered by the SSS or the GSIS, Pag-IBIG coverage follows, and the employer’s duty to register and remit attaches at the same moment. There is no qualifying period of service, no probationary exemption and no mechanism by which an employee and employer can agree to opt out.
The Statutory Rates
Section 7 sets three rates:
- Employees earning not more than ₱1,500 per month — 1% of monthly compensation
- Employees earning more than ₱1,500 per month — 2% of monthly compensation
- All employers — 2% of the monthly compensation of all covered employees
The asymmetry is easy to miss. The employee rate steps up at the ₱1,500 threshold; the employer rate is a flat 2% at every salary level. An employee earning ₱1,400 therefore contributes ₱14 while the employer contributes ₱28 on the same figure.
The Salary Cap and Why the Statute Understates It
Section 7 closes with a ceiling and, critically, a delegation. The maximum monthly compensation used in computing contributions “shall not be more than Five thousand pesos (₱5,000.00): Provided, That this maximum may be fixed from time to time by the Board of Trustees through rules and regulations adopted by it, taking into consideration actuarial calculations and rates of benefits.”
That proviso is why the operative figure is not the one printed in the law. HDMF Circular No. 460, signed 15 January 2024 and effective February 2024, raised the Maximum Fund Salary from ₱5,000 to ₱10,000. The Department of Budget and Management independently confirmed it, recording that the maximum fund salary “was increased from P5,000 to P10,000 per month,” producing a contribution “equivalent to P200 per month per employee.”
Anyone computing from the statute alone arrives at ₱100 + ₱100 and is two years out of date.
Figures stated as of August 2026. Because the Board can move the ceiling again without any amendment to the statute, confirm the current HDMF circular before relying on these amounts for payroll.
How to Compute the Contribution
The computation has two steps: cap the salary base at the Maximum Fund Salary, then apply the rates.
| Monthly compensation | Salary base used | Employee share | Employer share | Total credited |
|---|---|---|---|---|
| ₱45,000 | ₱10,000 (capped) | ₱200 | ₱200 | ₱400 |
| ₱18,000 | ₱10,000 (capped) | ₱200 | ₱200 | ₱400 |
| ₱10,000 | ₱10,000 | ₱200 | ₱200 | ₱400 |
| ₱8,000 | ₱8,000 | ₱160 | ₱160 | ₱320 |
| ₱1,400 | ₱1,400 | ₱14 (1%) | ₱28 (2%) | ₱42 |
Note the effect of the cap: every employee earning ₱10,000 or more contributes the same ₱200. Above that threshold the contribution does not scale with salary at all.
What the Employer Cannot Do
Section 7 is explicit: an employer “shall not deduct, directly or indirectly, from the compensation of its employees… the employer’s contribution.”
The employer’s 2% is a cost of employment, not a payroll deduction. Only the employee’s own share may lawfully be withheld from wages. The word “indirectly” closes the obvious workaround: an employer cannot reduce stated pay by the amount of its own counterpart and describe the arrangement as cost-neutral.
An employee who sees ₱400 deducted for Pag-IBIG on a single payslip is looking at either a double deduction or an unlawful pass-through of the employer share. See Net Pay and Gross Pay for how lawful deductions should appear.
Remittance Deadlines
Pag-IBIG does not use a single date for all employers. HDMF Circular No. 275 staggers the deadline by the first letter of the employer’s registered name, which spreads collections across the month.
| First letter of employer name | Remittance period |
|---|---|
| A to D | 10th to 14th day of the month |
| E to L | 15th to 19th day of the month |
| M to Q | 20th to 24th day of the month |
| R to Z and numerals | 25th day to the end of the month |
The schedule applies to the month following the payroll month to which the contributions relate. Employers that changed registered name should check which band they now fall into rather than assuming the old one still applies.
Penalties for Late or Non-Remittance
Two measures appear in the sources and they should not be conflated.
Section 23(b) of Republic Act No. 9679 fixes a statutory penalty of “three percent (3%) per month” on unremitted contributions.
HDMF Circular No. 275 expresses the same exposure operationally, as 1/10 of 1% per day of delay.
Circular No. 275 adds a consequence employers routinely overlook. An employer that deducted the employee’s share but failed to remit it is liable for the contributions “including all applicable interests and penalties, as well as the dividends that the contributions could have earned.” The member is made whole for investment growth foregone, not merely for the principal withheld.
Under Section 23(e), unpaid contributions are collectible “in the same manner as taxes… under the National Internal Revenue Code,” and an action may be brought within twenty years from the time the delinquency is known — a far longer window than the three-year prescriptive period that applies to ordinary employment money claims.
If Your Employer Did Not Remit
This is the provision every member should know, and it is unambiguous.
Section 23(d): “Failure or refusal of the employer to pay or to remit the contributions herein prescribed shall not prejudice the right of the covered employee to the benefits under this Act.”
The member’s entitlement does not depend on the employer having actually paid. Benefits stand, and the remedy runs against the employer. An employee whose contributions were deducted but never posted has not lost them; the Fund’s claim is against the employer, and it carries interest, penalties and foregone dividends on top of the principal.
The practical first step is documentary. Compare the Pag-IBIG line on your payslips against the contributions actually posted to your member record. A discrepancy between the two is the evidence that matters.
Criminal Liability
Section 25 provides for a fine “not less than, but not more than twice, the amount involved or imprisonment of not more than six (6) years, or both.”
Where the offender is a corporation, the section directs that “the penalty shall be imposed upon the members of the governing board and the president or general manager.” Liability reaches identified individuals rather than stopping at the corporate entity.
One accuracy note worth making, because the point is often overstated in circulating material: Republic Act No. 9679 contains no estafa or misappropriation label and no “without prejudice to the Revised Penal Code” clause. Section 25 is the operative penal provision and it is sufficient on its own terms.
Employer Compliance Checklist
- Register every employee covered by the SSS or the GSIS — coverage is automatic and attaches from the start of employment.
- Apply the ₱10,000 Maximum Fund Salary cap before applying the rates, and confirm the current circular before each payroll year.
- Deduct only the employee’s own share. Never pass the employer’s 2% to the employee, directly or indirectly.
- Identify your remittance band from the first letter of the registered employer name and diarise it.
- Reconcile deductions against posted contributions periodically — a deduction that was never remitted accrues penalties and foregone dividends.
- Retain remittance receipts. The twenty-year collection window under Section 23(e) is far longer than ordinary payroll retention practice.
Frequently Asked Questions
How much is deducted from my salary for Pag-IBIG?
For most employees, ₱200. Anyone earning ₱10,000 or more a month is at the capped maximum, so the deduction is the same regardless of salary above that point. Employees earning less contribute 2% of actual monthly compensation, or 1% if they earn ₱1,500 or less.
Why do some sources say the maximum is ₱100?
Because Republic Act No. 9679 still prints a ₱5,000 salary ceiling. The Board of Trustees doubled it to ₱10,000 through HDMF Circular No. 460 effective February 2024, using the express power the same section grants. The statute was never amended, so sources reading only the law give a figure that has been out of date since 2024.
Can I contribute more than ₱200?
Yes. The ₱200 figure is the maximum mandatory employee share on the capped salary base. Members may contribute above it voluntarily. The employer’s counterpart obligation remains fixed at the statutory computation and does not rise to match a voluntary increase.
Is Pag-IBIG deducted from 13th month pay?
Contributions are computed on monthly compensation. Whether a particular pay component forms part of that base is determined by the Fund’s rules; in practice the question is academic for any employee already at the ₱10,000 cap, since the contribution is already at its maximum. See 13th Month Pay.
What happens if my employer deducted but never remitted?
Your benefits are unaffected. Section 23(d) preserves the covered employee’s rights regardless of the employer’s default. The employer is liable for the contributions, interest, penalties and the dividends the money would have earned, and the Fund may collect in the same manner as taxes within twenty years of the delinquency becoming known.
Does Pag-IBIG coverage stop when I resign?
Mandatory coverage through an employer ends with the employment, but membership and the accumulated savings do not disappear. A member between jobs may continue contributing voluntarily so that the savings record remains unbroken.
Additional Official References
- Republic Act No. 9679 — the governing statute, including Sections 6, 7, 23 and 25.
- HDMF Circular No. 460 — the Maximum Fund Salary increase effective February 2024.
- HDMF Circular No. 275 — remittance schedule, daily penalty and liability for foregone dividends.
- Department of Budget and Management Circular Letter No. 2024-2 — independent confirmation of the ceiling increase.
Related LaborCode.ph Guides
- What the Pag-IBIG Fund is
- Pag-IBIG member benefits, claims and loans
- PhilHealth Contribution
- Final Pay
Sources and Legal Citations
- Republic Act No. 9679, the Home Development Mutual Fund Law of 2009, Sections 6, 7, 23 and 25. Official text. Classification: statute.
- HDMF Circular No. 460, signed 15 January 2024, effective February 2024 — Maximum Fund Salary raised from ₱5,000 to ₱10,000. Classification: implementing circular.
- Department of Budget and Management, Circular Letter No. 2024-2, 1 February 2024, confirming the increase and the resulting ₱200 monthly figure. Official text. Classification: government circular.
- HDMF Circular No. 275, 22 January 2010 — remittance schedule by first letter of employer name, penalty of 1/10 of 1% per day of delay, and liability for dividends the contributions could have earned. Classification: implementing circular.
Disclaimer
This guide is for general educational and legal-information purposes only. It is not legal advice. Contribution ceilings are set by the HDMF Board of Trustees and change without any amendment to the statute, so the current circular should be confirmed before the figures above are applied to payroll.
