NINETEENTH CONGRESS OF THE 
REPUBLIC OF THE PHILIPPINES 
Second Regular Session
)
SENATE
S. B. No. ^^"79
of tin'itavi
23 NOV -8 P6 -46
RtCEIViD BY
Introduced by Senator Joseph Victor G. Ejercito
AN ACT
PROVIDING FOR TAX INCENTIVES FOR EMPLOYEES ON A WORK-FROM- 
HOME OR TELECOMMUTING PROGRAM, FURTHER AMENDING FOR THE 
PURPOSE REPUBLIC ACT NO. 8424, OTHERWISE KNOWN AS THE NATIONAL 
INTERNAL REVENUE CODE (NIRC) OF 1997, 
AND FOR OTHER PURPOSES
EXPLANATORY NOTE
The Work-From-Home set-up which was empioyed during the COVID - 19 
pandemic is one of the best positive resuits that the pandemic has brought in us. In 
fact, this set-up has even improved productivity among empioyees and maximized 
performance output. Savings for resources such as transportation cost, gasoiine, 
utilities (in the office) and other operating expenses were realized. The time spent on 
traffic for empioyees and employers are now spent with their famiiies while doing their 
work at home. However, whiie empioyees working from home also incur additionai 
expenses at home. Their utilities expense, most specialiy electricity, also increased 
aside from the cost for the instaiiation of internet connectivity. As a resuit, employees 
working from home shouider a portion of the operating costs which are conventionaliy 
being shouldered by their empioyers when rendering onsite work.
Having said this, the bilis seeks to amend the Tax Code in order to provide 
additional deduction to the compensation income of employees working from home 
by lowering their tax dues and increasing their take home pay as a way to offset the 
expenses they incur whiie working from home. The bili aiso proposes a tax benefit to


f 
t
the employers providing allowances to employees to somehow cover expenses 
incurred by their employees necessary for telecommuting.
JOSEPH VICTOR G. EJERCITO


NINETEENTH CONGRESS OF THE 
REPUBLIC OF THE PHILIPPINES 
Second Regular Session
)
SENATE
S.B. No. 2479
of tlif S :
23 NOV-8 P6 '46
RECElVtO 8V
Introduced by Senator Joseph Victor G. Ejercito
AN ACT
PROVIDING FOR TAX INCENTIVES FOR EMPLOYEES ON A WORK-FROM- 
HOME OR TELECOMMUTING PROGRAM, FURTHER AMENDING FOR THE 
PURPOSE, REPUBLIC ACT NO. 8424, OTHERWISE KNOWN AS THE 
NATIONAL INTERNAL REVENUE CODE (NIRC) OF 1997, 
AND FOR OTHER PURPOSES
Be it enacted by the Senate and the House of Representatives of the Philippines, in 
Congress assembled:
1 
Section 1. Section 34 of Republic Act No. 8424, or the National Internal Revenue
2 
Code of 1997, is hereby amended to read as follows:
3 
"Sec. 34. Deductions from Gross Income. 
- Except for taxpayers earning
4 
compensation income 
arising from personal services rendered under 
an
5 
employer-employee relationship where no deductions shall be allowed under
6 
this Section, AND EXCEPT AS OTHERWISE PROVIDED FOR HEREIN IN
7 
CASE OF WORK-FROM-HOME AND TELECOMMUTING EMPLOYEES, in
8 
computing taxable income subject to income tax under Sections 24(A); 25(A);
9 
9 26; 27(A), (B), and (C); and 28(A)(1), there shall be allowed the following 10
10 
deductions from gross income:
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(A) Expenses -
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(1) Ordinary and Necessary Trade, Business or Professional Expenses-
13 
(a) XXX
14 
(b) XXX
15 
(c) XXX


1 
(D) WORK-FROM-HOME OR TELECOMMUTING EMPLOYEES.
2 
NOTWITHSTANDING THE FIRST PARAGRAPH OF THIS SECTION,
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INDIVIDUALS EARNING COMPENSATION INCOME SHALL BE
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ENTITLED A DEDUCTION OF TWENTY-FIVE PESOS (P25.00) FROM
5 
THEIR TAXABLE INCOME FOR EVERY HOUR WORKED UNDER A
6 
WORK-FROM-HOME OR TELECOMMUTING ARRANGEMENT.
7 
PROVIDED, THAT, THE EMPLOYEE SHALL CERTIFY UNDER OATH, THE
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NUMBER OF HOURS SERVED UNDER THE WORK-FROM-HOME OR
9 
TELECOMMUTING PROGRAM FOR THE YEAR, WHICH SHALL BE FILED
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AS AN ATTACHMENT TO THE EMPLOYEE'S INCOME TAX RETURN.
11
12 
ALLOWANCES OR OTHER BENEFITS GRANTED BY EMPLOYERS TO
13 
THEIR EMPLOYEES TO COVER EXPENSES NECESSARY FOR
14 
TELECOMMUTING, NOT EXCEEDING TWO THOUSAND PESOS
15 
(P2,000) PER MONTH, SHALL BE CONSIDERED AS A NON-TAXABLE
16 
BENEFIT. AMOUNTS GRANTED IN EXCESS SHALL BE SUBJECTED TO
17 
EXISTING TAX RULES; PROVIDED, THAT, EMPLOYEES RECEIVING
18 
THIS BENEFIT SHALL NO LONGER BE ENTITLED TO THE HOURLY
19 
DEDUCTION FROM INCOME TAX PROVIDED FOR IN THE PRECEDING
20 
PARAGRAPH; PROVIDED FURTHER, THAT, EMPLOYERS SHALL BE
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ENTITLED TO AN ADDITIONAL FIFTY PERCENT (50%) INCOME TAX
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DEDUCTION FOR ALLOWANCES GRANTED WITHIN THE SPECIFIED
23 
CEILING.
24 
Sec. 2. Implementing Rules and Regulations - The Department of Finance,
25 
together with the Bureau of Internai Revenue, shall promulgate the rules and
26 
regulations to implement this Act within ninety (90) days from the effectivity of this
27 
Act.
28 
Sec. 3. Separability Clause. - If any part or provision of this Act is held
29 
unconstitutional or invalid, the other parts or provision hereof which are not affected
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shall continue to be in fuil force and effect.
31 
Sec. 4. Repealing Clause. — Any law, presidential decree or issuance, executive
32 
order, letter of instruction, administrative order, rule, or regulation contrary to or


1 
inconsistent with the provisions of this Act is hereby repealed, modified, or amended
2 
accordingiy.
3 
Sec. 5. Effectivity. - This Act shail take effect fifteen (15) days after its
4 
publication in at least two (2) newspapers of general circulation.
Approved,