A Guide to Calculating SSS Contributions

The Social Security System (SSS) is a government-run program in the Philippines that provides social security benefits to eligible employees. As an employer, it is important to have a proper payroll system, payroll services, and payroll outsourcing in place to ensure that the SSS contributions of your employees are calculated and remitted correctly and on time.

With the implementation of the New Schedule of Social Security Contributions effective January 2023 or SSS Circular No. 2022-033, here’s an overview on how to calculate SSS monthly contributions with the help of a payroll system or payroll services:

  1. Determine the employee’s compensation: The SSS monthly contribution is based on the employee’s monthly compensation. With a payroll system or payroll services, you can easily calculate the employee’s compensation.
  1. Look up the range for Monthly Salary Credit (MSC): The new contribution rate of 14% with the minimum MSC of P4,000 and the maximum MSC to P30,000 can be determined with ease using the payroll system.
  1. Calculate the employee’s contribution: To calculate employee’s contribution, multiply their monthly salary credit by 4.5%. For example, if an employee’s MSC is P20,000, the employee’s contribution for the month is P900 (P20,000 x 4.5%). P900 is the maximum amount for employee’s contribution. A payroll system or payroll services can automate this calculation for you.
  1. Calculate the employer’s contribution: To calculate employer’s contribution, multiply their monthly salary credit by 9.5%. For example, if an employee’s MSC is P20,000, the employer’s contribution for the month is P1900 (P20,000 x 9.5%). P1900 is the maximum amount for employer’s contribution. A payroll system or payroll services can automate this calculation for you.
  1. Calculate the employer’s share of Employee’s Compensation (EC) share: MSC amounting to P4,000 up to P14,500 their EC share is P10 and in excess will be P30. A payroll system or payroll services can automate this calculation for you.
  1. Calculate the SSS Provident Fund called WISP (Worker’s Investment Savings Program): MSC above P20,000 will go to WISP. For example, if an employee’s MSC is P30,000 the excess is P10,000 (P30,0000 – P20,000) and the employee’s Provident Fund will be P450 (P10,000 x 4.5%) and P950 (P10,000 x 9.5%) for the employer. A payroll system or payroll services can automate this calculation for you.
  1. Remit contributions to the SSS: Employers are responsible for remitting the SSS contributions of their employees to the SSS on a monthly basis. With the help of payroll system or payroll services, the process of remitting the contributions can be done easily and accurately. Contributions can be remitted online through the SSS website or at any SSS branch. A payroll outsourcing service can also assist you with the remittance process and ensure compliance. Be sure to keep a record of the contributions and the corresponding SSS receipts as proof of remittance.

In summary, having a proper payroll system, payroll services, or payroll outsourcing in place can help ensure that the SSS contributions of your employees are calculated and remitted correctly and on time. Contact Zalamea Payroll Solutions today at info@zalamea.ph or call 0946 710 1128 to learn more about how we can help take the burden off your shoulders.