Updated April 2026.
Payroll compliance in the Philippines is not one obligation but a stack of them: four agencies, different schedules, and penalties that compound quietly when something slips. This checklist is the full stack for a typical SME with rank-and-file employees.
One-time: when you register or hire your first employee
- Register as an employer with the BIR (withholding agent for compensation), SSS, PhilHealth and Pag-IBIG, and get your employer numbers for each.
- Report each new hire to SSS, PhilHealth and Pag-IBIG, and collect their TIN, SSS, PhilHealth and Pag-IBIG numbers before the first payroll.
- Set up your payroll register: for every run you must be able to show gross pay, each deduction, and net pay per employee, keep these records for at least three years.
Every cutoff
- Compute earnings from actual attendance: basic pay, overtime, night differential (10pm–6am), and regular/special holiday premiums.
- Deduct the employee shares of SSS, PhilHealth, Pag-IBIG and withholding tax, current rates are in our contribution guide.
- Issue payslips. Employees are entitled to see how their pay was computed.
Every month
- Remit SSS, PhilHealth and Pag-IBIG contributions (employee + employer shares) on each agency's schedule for your employer number.
- File and pay BIR Form 1601-C (withholding tax on compensation), generally by the 10th of the following month for manual filers, later for eFPS filers depending on grouping.
Every year
- On or before 24 December: pay 13th-month pay (see our 13th-month guide).
- By mid-January: file the DOLE 13th-month pay compliance report.
- By 31 January: issue BIR Form 2316 to every employee and file the annual information return with the alphalist of employees.
- Recompute (annualize) withholding tax in December so each employee's total tax for the year is trued up in the final payroll.
Ongoing labor-standards items
- Observe minimum wage for your region (wage orders change, so check your Regional Tripartite Wages and Productivity Board).
- Grant service incentive leave (5 days/year after one year of service) and the statutory special leaves, maternity, paternity, solo parent and others where applicable.
- Pay final pay (last salary, prorated 13th month, leave conversions) within the period DOLE guidance prescribes: 30 days from separation is the working standard.
The honest summary
None of these steps is hard on its own. What breaks companies is doing all of them, every month, from spreadsheets, one missed bracket update or forgotten filing at a time. That is exactly the problem payroll software exists to solve.
Run this automatically instead. Tropa computes statutory contributions, 13th-month pay and withholding tax from your actual attendance every cutoff. See automated payroll or pricing, and start a 30-day free trial.