Part III: Employer Contributions in the Philippines: Home Development Mutual Fund (Pag-IBIG)

Posted on June 8, 2015 by Pragya Gupta

This is the final iteration of the ‘Employer Contributions in the Philippines’ set of blog posts. So far, we have given you an overview of the BIR, the SSS and PhilHealth. We will now talk about the Home Development Mutual Fund – popularly known as Pag-IBIG Fund. The fund is the biggest source of housing finance in the Philippines. Along with the SSS and PhilHealth, employers also need to register to Pag-IBIG.

Requirements: Before you register your business with Pag-IBIG, you will need the following:

Employer’s Data Form (make sure you have a TIN and your SSS employer number to fill the form)
Specimen Signature Form (SSF [HQP-PFF-003])
SSS certification
Proof of business existence (Business permit/ Mayor permit)

You need to fill these forms and take them to the nearest Pag-IBIG service center. After the documents are processed, you will receive the Pag-IBIG Employer ID.

The following is the contribution that is required by the employer and employee

The Pag-IBIG registration process can be done online as well. After deductions, payment to the fund can be done online or through one of the accredited banks.

	Employee Share	Employer Share
PHP 1,500.00 and below	1%	2%
Over PHP 1,500.00	2%	2%

Finally, here we have an example on how PayrollHero calculates Pag-IBIG deductions.

This marks the end of our 3 part blogpost on Employer Contributions in the Philippines. For details on BIR, SSS and PhilHealth, click on the links. To see how PayrollHero calculates deductions on BIR, SSS and PhilHealth, make sure to click on the links.

Here is a helpful video from our friends at ZipMatch.com about Pag-IBIG

Disclaimer: As always, consult your lawyer or accountant for advice! We are here to help, but your specific situation should be reviewed by a professional with complete knowledge of your situation.

If you are interested in learning more about PayrollHero for your Philippine business, check out our website at PayrollHero.ph. We would be pleased to chat further about your needs.

Part II: Employer Contributions in the Philippines: PhilHealth

Posted on June 8, 2015 by Pragya Gupta

Philippines PhilHealth Our previous post was an introduction to employer contributions in the Philippines with a closer look on BIR and the SSS. In this post, we’ll give you an idea about how health insurance works in the Philippines. PhilHealth is the health insurance institution that all private and government companies are required to register their new employees to. Here is a list of benefits that PhilHealth covers. Unlike the SSS, the employer’s share towards insurance is equal to the employee’s share towards insurance. The contribution schedule is available here.

Step 1: Employers need to first register their business through the Philippines Business Directory.

Step 2: All employees must submit the PhilHealth Member Registration Form (PMRF) to the HR department. Once that is done, you need to register your employees by filling out Employee Data Record (ER1) Form and submit the ER1 Form with the PMRF for each employee.

Step 3: After the forms are processed, companies will be given the following:

PhilHealth Employment Number (PEN)
Certificate of Registration
PhilHealth Identification Number (PIN)
Member Data Record (MDR) of registered employees.

The Certificate of Registration is required to be displayed clearly in your business’s offices.

Step 4: After deducting employer and employee contributions from the basic monthly salary, payment must be made to PhilHealth or via Accredited Collecting Agents. The payment should be made on or before the due date. The table below is from the PhilHealth website:

Employers with PENs ending in 0-4	Every 11th-15th day of the month following the applicable period
Employers with PENs ending in 5-9	Every 16th-20th day of the month following the applicable period

Step 5: Once the payment is done, you will have to report it within 5 days with the revised RF-1 Form. Alternatively, you can report it online using the Electronic Premium Reporting System

Additional Info:

For new employees in the company, you will have to file the ER2 form to ensure that they are covered by PhilHealth too. Make sure to ask them if the have their PIN so that you can add it to the ER2 form. The form should be submitted to PhilHealth within 30 days of the new employees coming into office. For separated employees, Form RF1 must be filled and submitted within 30 days of the employee leaving. To amend employer data, ER3 form must be filed along with supporting documents.

This is it for PhilHealth. For reference, here is how PayrollHero calculates PhilHealth deductions. Check out Part III of our posts on employee contributions. We give you a crash course on Pag-IBIG deductions.

Disclaimer: As always, consult your lawyer or accountant for advice! We are here to help, but your specific situation should be reviewed by a professional with complete knowledge of your situation.

If you are interested in learning more about PayrollHero for your Philippine business, check out our website at PayrollHero.ph or contact us at sales@payrollhero.com. We would be pleased to chat further about your needs!

Singapore Corporate Taxes 102: Auto Inclusion Scheme

Posted on June 4, 2015 by Pragya Gupta

pablo

Our Singapore Corporate Tax lessons are back! (I know what you’re thinking… nothing says exciting like taxes). This time we’ll be talking about how employers in Singapore should handle tax forms for their employees. The IRAS is trying to digitize the entire system by introducing the Auto Inclusion Scheme this year and linking it to CPF contributions. In short, filing tax returns is going to be a smoother, more integrated process.

Under the Income Tax Act, there are four forms that employers should be aware of:

Form IR8A: This is to declare income of all employees
Appendix 8A: This form should be completes if the employee is provided with benefits-in-kind unless these benefits are exempted from Income Tax
Appendix 8B: If the employee has benefited from any Share Ownership Plans, then this needs to be completed
Form IR 8S: Must be completed if excess CPF contributions are made by the employer.

Explanatory notes on each form are here. Income tax returns must be filed for the following people:

Full time resident employees
Part time resident employees
Non-resident employees
Company director (including a non-resident director)
Pensioner and
Employees who have left the organisation within the financial year

For your reference, here are the tax rates for different income brackets:

Taxable Income Bracket	Total tax on income below bracket	Tax rate on income in bracket
0-20,000	0	0
20,001-30,000	0	2
30,001-40,000	200	3.5
40,001-80,000	550	7
80,001-120,000	3,350	11.5
120,001-160,000	7,950	15
160,001-200,000	13,950	17
200,001-320,000	20,750	18
>320,001	42,350	20

The Auto Inclusion Scheme is a system for recording employee income and tax related information for companies with 12 or more employees for the entire year, ending 31 December 2014. Companies have to submit employee information to IRAS electronically by March 1st of every year, starting from 2015. This way, companies do not need to distribute hard copies of the above forms for employees to file their income tax returns.

If employers use payroll software to generate payroll, then the software can be used to submit files to AIS using another (free) software provided by the IRAS called the Validation and Submission Application. The payroll software should meet the IRAS file format specifications in order to submit forms. The Validation and Submission Application software can be downloaded here.

Once every employee’s details are filled in through AIS, companies should inform their employees to file their tax returns through the myTaxPortal. Employees no longer need to fill in their income and details from the four forms above because the AIS system already has it stored.

Employers who have fewer than 12 employees are also encouraged to use the AIS by filling out this form and emailing it to ais@iras.gov.sg. After submitting the form, companies will also have to go through a trial exercise before joining the AIS.

The AIS system can be linked to CPF Data in order to fill up Form IR 8S easily. The system makes for smooth functionality across the IRAS and CPF platforms. To sign up for the AIS and CPF Data Link-up Service from 2016, this application form must be filled. For existing AIS members who want to use the CPF Data Link-Up Service, this application form must be filled.

Hope this helps! If you want to know how to pay up CPF contributions, we’ve got you covered. More on Tax Clearance and CPF contributions later.

Disclaimer: As always, consult your lawyer or accountant for advice! We are here to help, but your specific situation should be reviewed by a professional with complete knowledge of your situation.

Canada B2B Networking Marketplace: The Post Event Write-up

Posted on June 2, 2015 by

Great turn out at the Canada B2B Networking Marketplace

The energy at the event was amazing as business owners are enthusiastic to share their product stories with others in attendance.

PayrollHero made a presence and shared our story- how we believe we can help businesses function better with our nifty HR and payroll management software in the cloud.

We would like to say a big Thank You to Guy Belanger for letting us take part in this great opportunity.

Thank you Guy!

Event Highlight

This year’s event also marks the 50th anniversary of bilateral ties between Singapore and Canada. In a speech by High Commissioner H.E Heather Grant, she expressed gratitude to be friends with Singapore and played a part during its formative years since 1965. (Read more about Singapore’s 50th anniversary of bilateral relationship with 13 other countries)

This event was a prelude to the main exhibition and networking events: CommunicAsia 2015 and BroadcastAsia 2015 held at the Marina Bay Sands, Singapore between 2- 5 June 2015.

If you’ve missed the opportunity to speak with the companies present at last night’s event, you can be sure to speak to them at these events. The Canadian pavilion at MBS Basement 2 (BH3-07) has meeting spaces to be used at your convenience on a first-come first-served basis.

If you’re looking to meet with PayrollHero, we are having a casual meetup at our office on 10th June 2015.

Details and Registration available here >>>

Scheduling Practices: Hallway Test!

Posted on May 22, 2015 by Pragya Gupta

Today marks two weeks of my internship at PayrollHero. To celebrate my two-week-erversary, I went out to do a little survey. The aim was to understand what systems businesses have set up to manage scheduling, measure attendance and calculate payrolls.

2015-05-21 16.04.44__1432268258_115.42.154.34

The Costa Coffee crew.

I surveyed 10 cafés in the Central Business District in Singapore to find out how they schedule workers in their outlets. Some of the outlets I visited were Cedele, Starbucks, Joe & Dough and Costa Coffee. They all had similar systems set up to schedule workers, with a few interesting anomalies:

With the exception of one cafe, everyone uses the punch card system or a regular excel sheet for workers to clock in and clock out. The exception in question has software set up to monitor attendance.
Scheduling is done on a weekly basis. The worst case scenario is when a worker notifies the admin that he or she can’t show up just a few hours before the shift begins.
Usually, the outlet manager calls another outlet to find a substitute. In the case of one cafe, Whatsapp groups are used to coordinate and find substitutes. Most outlet managers believe that the best way to reach someone is to call them. Texting or emailing is not a common communication channel.
The HR admin in every outlet takes around 2 to 3 days to calculate payrolls.

With that simple survey, it was evident that cafés in Singapore use conventional ways to schedule shifts. While workers rarely drop shifts, outlet managers need to be on standby to call nearby outlets for substitutes immediately.

Using Data Analytics to Improve Productivity

When the weather is bad, or there is an MRT breakdown, the situation is worse because all outlets in the same region are affected equally. While an outlet manager is calling multiple outlets for substitutes, customers are walking in and waiting for service before walking out, disappointed and unhappy. That directly affects the bottom line. Managers should be able to access an online database and use data analytics to see which outlet is on top of things in real time in order to call that outlet directly and ask for a substitute.

The top priority for every outlet manager is to make sure the day runs smoothly. It becomes much harder when the manager is not equipped with the right data to plan ahead of time. In a country like Singapore that has high internet penetration rates and high cell phone penetration rates, installing an application that stores this data in the cloud is easy and inevitable. If managers had access to this data, it would also be a way to motivate workers to be regular in order to move higher up in the rankings among outlets.

Calculating Payrolls

The systems put in place for measuring hours worked per employee in order to calculate payrolls should also be revamped. It should not take a manager 2 or 3 days to calculate payrolls when she has a million other things to look after. What’s more, the hassle of buddy punching, human errors and shifts in multiple locations add to complications for the manager. More errors equal higher costs. Higher costs equal lower profits. The bottom line is affected by inefficiencies that can be wiped out by a one-time change in the basic infrastructure.

Finally, the idea behind having an app that does all of the above is predicated on increasing productivity: be it that of your rank and file workers or your manager. Higher productivity leads to a better workplace environment and happier people, which further leads to higher productivity. That is a virtuous cycle, if ever I saw one. In effect: optimizing work productivity with happiness.

Now, where have I heard that before…

The Employer’s Guide to Singapore Work Visas

Posted on May 19, 2015 by

https://www.youtube.com/watch?v=SjkXCsMXY-0&feature=youtu.be&rel=0

This video provides an introduction to hiring foreign workers in Singapore- types of visas available to the employee according to skill level, application criteria and levies due to the employer. More information is available on the Ministry of Manpower website

After you have incorporated your business in Singapore, you will need to hire employees, both local or foreign to work for your company. If you are employing non-resident employees in Singapore, as an employer you have to make sure that they hold a valid work pass (also known as work visa).

Professional Work Visa

Pass type	Who is it for
Employment Pass	For foreign professionals, managers and executives. Candidates need to earn at least S$3,300 a month and have acceptable qualifications.
EntrePass	For eligible foreign entrepreneurs wanting to start and operate a new business in Singapore.
Personalised Employment Pass	For high-earning existing Employment Pass holders or overseas foreign professionals. The PEP offers greater flexibility than an Employment Pass.

 Skilled or Semi- Skilled Workers

Pass type	Who is it for
S Pass	For mid-level skilled staff. Candidates need to earn at least S$2,200 a month and meet the assessment criteria.
Work Permit for foreign worker	For semi-skilled foreign workers in the construction, manufacturing, marine, process or services sector.

The Foreign Worker Levy

singapore work passes It is important to note that Singapore companies are required to pay Foreign Worker Levy (FWL) for the Work Pass and S Pass holders. This levy is imposed by the Singapore Government to regulate foreign workers numbers in the country.

The amount of levy due to the employer is determined by the sector the company belongs to and the educational level and skills of the employees. Employing workers with relevant qualifications and skill-based test certificates will count towards your skilled workers, which will entitle you to a concession in the worker’s levy.

Look at this example on the FWL scheme for manufacturing and service sectors.

Was this post helpful? Comment on this post to let us know!

PayrollHero is live in Singapore. We are completely localized to Singapore’s itemized payroll requirement. We are able to effectively compute the Inland Revenue Authority of Singapore (IRAS) taxes on employee remuneration, CPF employer contributions and deductions, bonuses, contributions to community funds (MDMF, SINDA, CDAC), Foreign Worker Levy and others- for your business in 5 Minutes!

Find out how PayrollHero can provide you the solution you need to optimise your payroll process. Write to us!

Singapore Payroll Software | Video

Posted on May 17, 2015 by Stephen Jagger

Our newest video for Singapore Restaurants and Retailer’s looking to learn more about our time, attendance, roster and payroll platform. What do you think the video? Let us know in the comments below. (PayrollHero.sg)
(30 seconds)

PayrollHero Singapore:

– PayrollHero is eligible for Singapore’s Spring Innovation & Capability Voucher (ICV) – Integrated Solutions (IS) (more details)

– Check out our Singapore specific website at PayrollHero.sg

The New Employer’s Guide to CPF

Posted on May 13, 2015 by

Further the blog post on what CPF is. We thought it will be helpful to post a general guide to how CPF works (with useful links to CPF Website), for the new entrepreneurs setting up business in Singapore.

You are an employer, and employing Singapore citizens or Permanent Residents (PR) in your company- you are required contribute to CPF for your employees at the end of each month.

Know your role as an employer. CPF conducts regular audits on employers to ensure that CPF contributions are paid correctly and on time (14 days grace period is given at end month). CPF also takes feedback from employees on incidences where employers have not paid or under-paid their CPF contributions. Note that the penalty to employers breaching the CPF Act may be taken to court and if convicted, fined up to $10,000 or imprisonment, or both.

With that in mind, let’s get this right.

Contribution on Employee Wages and Age Group
CPF contributions should be determined based on the employee’s total wages for the entire month. This includes overtime pay, allowances, cash awards, commissions and bonuses. Find out which types of payment attracts CPF Contributions here.

The CPF contribution rate is determined by different age groups. There are 6 defined age groups and the CPF contribution rates decreases as an employee moves to the next age group.

Here are the 6 age groups:

35 years and below
Above 35 and below 50 years
Above 50 and below 55 years
Above 55 and below 60 years
Above 60 and below 65 years
Above 65 years

As of 1 January 2015, the CPF contribution rates have increased to help employees save more for retirement and medical.

Click to find out the updated contribution rates. CPF website also offers a contribution calculator.

When to Pay Contributions
The CPF contributions are due at the end of every month with 14 days grace period given at the end month. Should the last day of the grace period falls on a weekend or public holiday, your payment will be due on the next business day.

You are required to pay the employer’s and employee’s share of CPF contributions monthly for all employees (Singapore Citizens and Singapore Permanent Residents) at the rates set out in the CPF Act. The CPF contributions payable should be based on the employee’s actual total wages earned for the calendar month.

How to Make Your Payment
CPF has made payment easy for new employers via online Direct Debit. As soon as you started the process of hiring your first employee, you should submit your CPF details using CPF e-Submit@web using the Singpass and Unique Entity Number (UEN).

Once you are approved, you will receive the an email and a welcome letter containing your CPF Submission Number, Payment Advice (CPF91) and Direct Debit Authorisation Form.

Here’s more details on Direct Debit deductions and FAQs

Was this post helpful? Comment and let us know.

Want to learn more about how PayrollHero can help you get your Singapore time, attendance, scheduling and payroll setup? Contact us for a one on one demo.

How Tech Savvy are Singapore’s Aunties and Uncles?

Posted on May 9, 2015 by

Getting into the mindset of being ‘Ridiculously Client Focused’

At Morseng Thai Herbs Store – Golden Mile Complex

Today, I was on a mission to find out how tech savvy our aunties and uncles really are. I set out to speak to some of our senior citizens to find out if they are as ‘cool’ as the young kids in town.

I had a few simple questions in mind; Do you have an email account?, What kind of phone do you have? What is your favourite app? These questions would be enough to help me understand if aunties and uncles will use a web app or mobile app for their jobs.

Surprisingly, most said YES! Age is not a factor! 7 out of 11 seniors I spoke with today, were not opposed to learn new apps on their smartphone. As for owning an email account, 6 seniors mentioned that they have their own personal email accounts, but rarely used. From that alone, I could guess that they are able to learn their way around using a computer and using a web app.

Another upside, is that 4 out of the 7 seniors that owned smartphones have Whatsapp as their favorite mobile app to use everyday. They use it to chat with families most of the time, and this clearly shows me that they know how to download and use a mobile app if they bother to learn how to.

The Best Uncle!

At Chocolat World – The Arcade

The highlight of my survey was from Uncle Roland. He was the most senior among the rest I spoke with today, but the most tech savvy. Surprise!

Roland is using a Samsung S4 phone and owns an email account, which he occasionally uses. He loves to chat on Whatsapp with his family everyday. When I asked him was it easy to learn to use the mobile app, he simply says that “old dogs got to learn new tricks!” Well said Roland!

The Take Away

This “hallway test” has revealed to me that the older demographic in our society, is getting on our tech savvy generation and willing to learn. They remain a relevant and viable target audience for us, and I have greater appreciation for them.

Singapore Payroll Software Show & Tell

Posted on May 5, 2015 by Stephen Jagger

Singapore Payroll Event We are holding another event at our office in the Ocean Financial Centre at Raffles Place in Singapore on May 14th 2015. At this free event you will learn about the pitfalls of manual time and attendance systems, how PayrollHero can help and the amazing business intelligence that can be delivered to your iPhone in real time.

The Coffee Bean and Tea Leaf, RedMart, BGC and many others are happy clients… come learn why they and many others subscribe to PayrollHero for their time, attendance, scheduling, HR and payroll needs.

Great turn out at the Canada B2B Networking Marketplace

Event Highlight

Details and Registration available here >>>

Pass type

Who is it for