PERA Granted to Government Employees is Considered Income Subject to Withholding Tax

October 1, 1991 BIR RULING NO. 200-91 21 (a) 132-91 200-91 Gentlemen : In reply to your letter dated July 29, 1991, please be informed that Personnel Economic Relief Allowances (PERA) granted to all employees of the National government, local government units, including government-owned or controlled corporations, is considered remuneration/ compensation for services performed by the employees for the employer, hence, taxable income subject to the withholding tax under Sec. 2 (2) (a) of Revenue Regulations No. 6-82 as amended by Revenue Regulations No. 12-86 (BIR Ruling No. 132-91). In view thereof, the temporary emergency allowance of P400 per month you have given your employees for the period from January to June 1991 which is the same as the PERA given to government employees is therefore, considered income subject to withholding tax. Very truly yours, (SGD.) EUFRACIO D. SANTOS Deputy Commissioner and Officer-in-Charge