THE BUREAU of Internal Revenue (BIR) has clarified that health insurance premiums are not taxable.
The BIR issued on Thursday Revenue Memorandum Circular (RMC) 96-2018, deleting a provision in RMC 50-2018 that says premiums paid to health maintenance organizations are included in the computation of taxable benefits and bonuses above P90,000 per year.
Senator Juan Edgardo M. Angara, chairman of the Senate Ways and Means committee, said in a statement on Sunday that Republic Act No. 10963, or the Tax Reform for Acceleration and Inclusion Act (TRAIN), did not deem health insurance premiums taxable.
“… [P]ertinent provisions under RMC 50-2018 relative to the group health insurance premiums… which were not affected by the provisions of the TRAIN law are hereby deleted,” according to RMC 96-2018.
Total bonuses exceeding the threshold are now subject to a 35% fringe benefits tax, up from 32% before TRAIN took effect. — EJCT