Bureau of Internal Revenue Updates Pera Accredited List with New Investment Products
The Bureau of Internal Revenue (BIR) has taken a significant step to enhance retirement savings opportunities for Filipinos by issuing Revenue Memorandum Circular (RMC) 003-2026 on January 12, 2026. This new circular supplements previous issuances, specifically RMC 131-2016 and 30-2017, and aims to broaden the range of investment options available under the Personal Equity Retirement Account (Pera) framework.
New Accredited Pera UITFs from EastWest Banking Corp.
EastWest Banking Corp. has been added to the BIR's accredited list, introducing four Unit Investment Trust Funds (UITFs) designed for Pera contributors. These new funds provide diverse investment strategies to cater to different risk appetites and financial goals:
- EastWest Pera Peso Money Market Fund: A low-risk option focusing on short-term debt securities.
- EastWest Pera Peso Intermediate Term Bond Fund: Targets medium-term bonds for balanced returns.
- EastWest Pera Peso Long Term Bond Fund: Invests in long-term bonds for higher potential yields.
- EastWest Pera Peso PSEi Tracker Fund: Tracks the Philippine Stock Exchange index for equity exposure.
Understanding the Pera System
Under Republic Act 9505, also known as the Pera Act of 2008, Pera refers to a voluntary retirement account established exclusively for the benefit of the contributor. These accounts are invested solely in Pera-accredited products that have been approved by regulatory authorities. To participate, individuals must have a Tax Identification Number (TIN) and can maintain up to five Pera accounts. Annual contributions are capped at P100,000 for Filipinos residing in the country and P200,000 for overseas Filipino workers, providing a structured approach to long-term savings.
Tax Benefits for Pera Contributors
The Pera system offers several tax incentives to encourage retirement savings, making it an attractive option for Filipinos:
- Contribution Tax Credit: Contributors are entitled to a five percent income tax credit on their total Pera contributions, subject to conditions outlined in Section 8 of RA 9505.
- Tax-Exempt Investment Income: Earnings from investments and reinvestments of Pera assets within the allowed contribution limits are exempt from income tax, as per Rule 11 of the Pera Act's implementing rules and Section 9 of Revenue Regulation 17-2011.
- Tax-Free Withdrawals: Contributors aged 55 and above, who have made at least five years of contributions, can withdraw their Pera funds tax-free, including all accumulated investment income.
Impact on Retirement Planning
The inclusion of EastWest Banking Corp.'s UITFs significantly expands the investment options available to Pera contributors. This move is expected to encourage more Filipinos to actively save for their retirement by providing a wider array of financial products that align with various investment strategies. By leveraging these new options, individuals can better plan for their future while enjoying the tax-exempt benefits that make Pera a compelling choice for long-term financial security.
Source: P&A Grant Thornton Certified Public Accountants
