Tax implications of PEZA's 70-30 work-from-home arrangement
June 03, 2022
On 2 August 2021, the Fiscal Incentives Review Board (FIRB) adopted Resolution No. 19-21, a temporary measure to support the recovery of registered business enterprises (RBE) during the covid-19 pandemic. The resolution allowed all RBEs in the information technology-business process management (IT-BPM) sector to continue implementing work from home (WFH) arrangements until 31 March 2022 without affecting their fiscal incentives. Such arrangements are subject to several requirements, such as the condition that no more than 90% of a RBE's total workforce may work remotely.
RBEs are enterprises that are registered with investment promotion agencies (IPAs), such as the Philippine Economic Zone Authority (PEZA), and are granted tax incentives (eg, preferential income tax rates) upon registration with an IPA.
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