If you are graduating from college in a few months or have just recently started applying for a job, you are most likely to apply for your very own SSS membership. Like what I said in my previous entry, for the young and the restless, an SSS number is nothing more than a pre-employment requirement that needs to be accomplished and submitted. I had to learn the facts on my own and when I did, I was thankful I worked on my membership at an early age and have not neglected to pay my contributions ever since.
What exactly is the SSS and how much of your income should go to it? Is it really wise to invest in it now while you’re young or would you much rather put your hard-earned money in a private life insurance firm that secures both you and your dependents?
Find the answers to these questions, and more, as I share to you what I’ve learned over the years about SSS and why it is considered one of the most important memberships and investments you should have.
What is the SSS?
The Social Security System (SSS) is an insurance program mandated by the Philippine government to cover all income earners in the private sector. Government employees are covered by GSIS but also have the option to voluntarily contribute to the SSS.
How much should I be paying SSS, whether I am an employed member or a voluntary member?
It really all depends on your compensation.
An employed member must be contributing 11% of the monthly salary credit, not exceeding P16,000. The amount is shared by the employee and his employer in the following rates:
- Employer – 7.37%
- Employee – 3.63%
Monthly salary: P30,000
Contribution is based on: P16,000 (highest monthly salary credit)
Amount to be paid by EMPLOYEE to SSS: P581.30
Amount to be paid by EMPLOYER to SSS: P1,208.70
Your TOTAL CONTRIBUTION SHOULD BE: P1,790 per month
Self-employed and voluntary members must contribute at a rate of 11% of the monthly salary credit which is then based on the monthly earnings declared at the time of registration:
- OFWs – MSC is P5,000
- Non-working spouses – MSC is based on 50% of the working spouse’s last posted monthly salary credit, but not lower than P1,000.
What is compulsory coverage and who are under this type of coverage?
Compulsory coverage is the mandatory registration of employees, employers, and self-employed persons with the SSS.
They are the following:
Employer (ER) – any person who pays for the services of another person for his business, trade, industry, or undertaking.
- A worker in the private sector, whether permanent, temporary, or provisional, and not over 60 years old;
- A house helper who is not over 60 years old;
- A seafarer, upon signing of the standard employment contract and actual deployment by the manning agency and the foreign principal;
- A worker of a foreign government or international organization, or its wholly-owned instrumentalities, with an approved Administrative Agreement with the SSS.
- Anybody who is engaged in trade, business, or occupation but is not employed by anyone other than himself;
- Derives an income of at least P1,000 a month from his/her physical and mental efforts, and
- Is not over 60 years old.
Tomorrow we shall feature voluntary membership, insurance coverage, and the contribution table for 2017. Stay tuned!
If you have any questions about your SSS membership, send us a message and we will do our best to find the answers for you.