The Philippine government offers social welfare services through SSS, GSIS, Pag-IBIG, and PhilHealth. The law requires that companies and employees contribute to these agencies, and part of your salary deductions make up your HDMF or Pag-IBIG contributions. 

If you’ve always wondered what this employee benefit is and how much you’re giving to Pag-IBIG, join us as we take a closer look into your HDMF contribution.

What is the HDMF Contribution?

Pag-IBIG offers a regular savings program for all HDMF members. Also known as the HDMF contribution, it deducts part of an employee’s salary and their employer’s share of contribution. In turn, the Pag-IBIG Fund uses contributions to provide short-term and housing loans to its members.

Pag-IBIG sets aside employee contributions and distributes at least 70% of its annual net income to each member’s Pag-IBIG savings. These payments are called dividends, which slowly increase as members save more money.

How Much is Your Monthly Pag-IBIG Contribution?

Your monthly income will determine the monthly premium of your Pag-IBIG membership. The HDMF contribution table we’ve provided below shows how much you and your employer should contribute to Pag-IBIG’s savings program.

Monthly Income	Employee Share	Employer Share
₱1,500 or lower	1%	2%
Over ₱1,500	2%	2%

If you’re self-employed, your monthly contribution could fall anywhere between 3% to 4% since you’ll be covering both employee and employer shares.

Take note that ₱5,000 is the maximum compensation considered when your employer makes your monthly HDMF contribution computation. This sets you and your employer’s contribution at ₱100 each.

How Do You Compute Your HDMF Contribution?

Before calculating your Pag-IBIG contribution, consider your gross compensation to determine the percentage of employee and employer share. Once done, multiply your current compensation by the multiplier that corresponds to your monthly basic pay: 1% (₱1,500 or lower) or 2% (over ₱1,500). 

Here’s how we computed for an employee’s HDMF contribution using our sample ₱15,000 gross salary:

₱15,000 x 2% = ₱300 (₱15,000 x 0.02 = ₱300)

When Should Your Employer Remit Contributions?

Your employer should remit Pag-IBIG contributions on these dates:

First Letter of Employer or Business Name	Date of Payment
A - D	10th to 14th day of the month
E - L	15th to 19th day of the month
M - Q	20th to 24th day of the month
R - Z, 0 - 9	25th to the last day of the month

Meanwhile, self-employed members can pay:

1. On or before the 10th day of the month following the covered period (if they pay monthly)
2. On the 10th day of the first month of the quarter ( if the member pays quarterly)

Can You Withdraw Your HDMF Contribution?

A PAGIBIG member may withdraw the HDMF contributions already made, including earnings or dividends, upon meeting specific criteria as will be explained below.  

That said, you may choose to withdraw your contribution if:

Your Membership Matures

If you’ve made at least 240 monthly contributions, Pag-IBIG will give you your contribution. Pag-IBIG Overseas Program (POP) members will receive their TAVs after 5, 10, 15, or 20 years of membership.

You’ve Already Retired

Generally, you can receive your TAVs when you retire at age 65. But employees can also get their HDMF contributions if they opt for SSS or company retirement, as long as they’re at least 45 years of age.

You Have a Physical or Mental Disability

Pag-IBIG can also refund your TAVs if you’re experiencing complete and permanent disability. Pag-IBIG defines disability as any of the following:

• Temporary full disability for over 120 days
• Complete loss of eyesight
• Loss of two limbs (at or over the ankle or wrist)
• Permanent paralysis of both limbs
• Brain injury that results in incurable imbecility
• Any other cases as defined by a licensed physician and approved by the Board of Trustees

Other Situations Take Place

A full refund of your Pag-IBIG TAVs will apply to any of the following situations:

1. End of membership for health reasons
2. Permanent departure from the Philippines
3. Death (Pag-IBIG will divide your TAVs among your legal heirs)

Calculate HDMF Contributions Quickly & Accurately

HR teams are responsible for getting the right amount for monthly Pag-IBIG contributions. With a more streamlined computation process, you can reduce errors, save time, and focus on empowering your workforce. 

If you need help computing other employee benefits, check out our blog for more tips and insights. You may also want to consider shifting to Sprout’s holistic ecosystem of products designed to reduce payroll, HR, and recruitment difficulties.