![\"\"](\"https:\/\/www.newsbeep.com\/uk\/wp-content\/uploads\/2026\/09\/economy-default.jpg\" "\\"economy-default\\"\/")
<\/p>\n <\/p>\n
While the shortness of life often encourages us to live in the present, it is equally important to prepare for the future with hope and confidence. Of the many things that require long-term planning, financial security and retirement remain particularly important, along with understanding the available incentives. For contributors to a Personal Equity and Retirement Account (PERA), it is worth noting that they may be qualified for a tax credit equivalent to 5% of their annual contributions.<\/p>\n
Revenue Memorandum Circular (RMC) No. 94-2026 provides timely and relevant guidance on the utilization of tax incentives available under Republic Act No. 9505, otherwise known as the PERA Act of 2008. It also highlights the need to plan carefully, to avoid losing out on expired or unutilized tax credits. Under the PERA Act, Filipinos are encouraged to save for retirement through a voluntary retirement program that offers various tax incentives. One of the most attractive incentives is the 5% tax credit granted to qualified PERA contributors based on their qualified annual contributions.<\/p>\n
RMC No. 139-2020 established the framework for the issuance and utilization of the PERA Tax Credit Certificates (TCCs). RMC No. 94-2026 enhanced that framework by addressing questions on the certificates\u2019 validity, utilization, excess credits, early withdrawal, succession, and electronic processing.<\/p>\n
MORE FLEXIBLE FOR CONTRIBUTORS
One of the most significant enhancements introduced by RMC No. 94-2026 is the clarification on the validity period of PERA TCCs. Under the new guidelines, PERA TCCs issued on or after July 27, 2023 are valid for five years from the date appearing on the certificate. Contributors should therefore monitor both the amount and the validity of their available tax credits, to avoid inadvertently losing the incentive.<\/p>\n
To manage this, contributors have the option to utilize only a portion of an available tax credit. Under RMC No. 94-2026, contributors are no longer compelled to claim the entire amount of their available PERA tax credits at once. Instead, they may request a TCC corresponding only to the amount needed to offset their current tax liability. This gives contributors more control over how much credit to use instead of outright requesting a full amount of TCC, to better align with their tax obligations.<\/p>\n
RMC No. 94-2026 also embraces digitalization. The circular introduces electronic processing through the BSP\u2019s PERASys which is interconnected in real time with the BIR\u2019s ePERA System. Once approved, the certificate becomes available through PERASys and may be released in hard copy or sent as pdf through the contributor\u2019s official e-mail address upon request.<\/p>\n
The RMC also provides QR-code validation and enhanced monitoring mechanisms. These improvements are expected to make the issuance, verification, and utilization of PERA TCCs more efficient, secure, and transparent. Together with QR-code validation and enhanced monitoring, these electronic processes are intended to make PERA TCCs easier to issue, verify, and monitor. Their practical value, however, will depend on smooth implementation across PERASys, ePERA, employers, contributors, and BIR offices.<\/p>\n
CREDITS CAN STILL BE LOST
Although flexibility has increased, the need for careful planning remains. While RMC No. 139-2020 generally contemplated the issuance of another TCC in lieu of a cash refund for excess credits, RMC No. 94-2026 introduces a more specific rule for self-employed individuals and overseas Filipino contributors. It clarifies that any amount of a released PERA TCC that exceeds the actual tax due may be forfeited in favor of the government. Consequently, contributors should maximize the option to request a portion of the available credit and carefully estimate their tax liabilities before requesting the issuance or utilization of tax credits to avoid forfeiture.<\/p>\n
For qualified employees whose income tax is settled through withholding, the employer applies the PERA TCC during the annual year-end adjustment. If the certificate exceeds the employee\u2019s total tax due, the excess credit may be carried forward and applied against withholding tax in the following taxable year. The consequences of an excess credit therefore depend partly on the contributor\u2019s classification, making it important to understand the rules applicable to one\u2019s particular circumstances.<\/p>\n
The RMC likewise reinforces the long-term nature of retirement savings. The circular clarifies that printed and utilized TCCs may be deemed utilized in computing the applicable penalties arising from the early withdrawal or termination of a PERA account, unless proven otherwise.<\/p>\n
This serves as a reminder that PERA is designed as a retirement vehicle and should be approached with a long-term investment perspective rather than as a source of short-term liquidity.<\/p>\n
Another noteworthy clarification relates to estate planning. Unclaimed or unutilized PERA TCCs of a deceased contributor cannot be transferred or applied against estate tax liabilities. Contributors cannot assume that such benefits may simply pass on to their heirs together with the retirement assets.<\/p>\n
MANAGING THE INCENTIVE
Ultimately, the value of RMC No. 94-2026 lies in its ability to help PERA contributors maximize the benefits available under the PERA Act. While earlier RMC gave contributors access to the 5% tax credit incentive, the newer circular helps them better understand, monitor, and utilize that incentive through clearer rules, enhanced flexibility, and stronger administrative safeguards. At the same time, it places responsibility on them to manage those credits properly.<\/p>\n
As Filipinos continue to navigate changing economic conditions and increasing financial responsibilities, retirement planning becomes even more important. Saving for retirement is not merely about setting aside money; it is also about understanding the opportunities and incentives, and regulatory frameworks designed to help those savings grow. A tax incentive is valuable only if it can be properly preserved and used. RMC No. 94-2026 makes the PERA tax credit more manageable, but not necessarily more forgiving. The message is clear for retirement savers: planning for the future requires attention not only to how much one saves, but also to how the available incentives are monitored and utilized.<\/p>\n
The views or opinions expressed in this article are solely those of the author and do not necessarily represent those of Cabrera & Co. The content is for general information purposes only and should not be used as a substitute for specific advice.<\/p>\n
\u00a0<\/p>\n
Leah Martizano is a senior legal advisor at Cabrera & Co., a Philippine member firm of the PwC network<\/p>\n