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Tax Notes

Grounds for terminating Pag-ibig I membership

Grounds for terminating Pag-ibig I membership

PAG-IBIG memberships are classified into two categories: Pag-ibig Membership I under mandatory membership and Pag-ibig Membership II under voluntary membership.

Those registered under mandatory membership include, but are not limited to:

A private employee (whether permanent, temporary, or provisional) who is not over 60 years old;

A household helper earning at least P1,000 a month;

A Filipino seafarer upon the signing of the standard contract of employment between the seafarer and the manning agency;

A self-employed person with an income of at least P1,000 a month and not over 60 years old;

An expatriate who is not more than 60 years old and is compulsorily covered by the Social Security System;

All employees who are subject to mandatory coverage by the Government Service Insurance System;

Uniformed members of the Armed Forces of the Philippines, the Bureau of Fire Protection, the Bureau of Jail Management and Penology, and the Philippine National Police; and

Filipinos employed by foreign-based employers.

The registrants listed above are entitled to withdraw their total accumulated value (i.e., contribution plus dividend) anytime upon the occurrence of membership term maturity, death, retirement, permanent total disability or insanity, permanent departure from the country, termination from the service by reason of health, and other causes that may be provided for by the board of trustees.

In addition, Pag-ibig Circular No. 408 includes critical illness of the member or any of their immediate family members, pertaining to cancer, organ failure, heart-related illness, stroke, or neuromuscular-related illness, as certified by a licensed physician, subject to the approval of the deputy chief executive officer of the Member Services Cluster.

For members who preemptively terminate their mandatory membership due to the grounds mentioned above, there will be no forfeiture of dividends for the remaining accumulated total value after the member/claimant has received the proceeds of the provident benefit claim.

If, after membership termination due to the allowed grounds, a member is placed in a situation that would subject him to mandatory coverage (i.e., subsequent employment after health improvement), the member will continue to be covered mandatorily after his subsequent enrollment.

Pag-ibig Circular No. 408 took effect on Aug. 16.

Please be guided accordingly.



Certified Public Accountants

Punongbayan & Araullo (P&A) is the Philippine member firm of Grant Thornton International Ltd.


As published in SunStar Cebu, dated 04 September 2018