As of the current tax framework under the National Internal Revenue Code (NIRC), as amended—most notably by the Tax Reform for Acceleration and Inclusion (TRAIN) Law (Republic Act No. 10963) effective 2018 and its subsequent implementing regulations.

1) Why this matters to public school teachers

Public school teachers are government rank-and-file employees paid mainly through compensation income. Their tax treatment is shaped by:

the general rules for employees under the NIRC,
special exclusions (e.g., the ₱90,000 cap on “13th month pay and other benefits”),
de minimis benefits (small-value, specifically listed benefits that are tax-exempt),
minimum wage earner (MWE) rules (usually not applicable to public teachers), and
withholding rules for government payrolls.

Understanding these moving parts helps determine which allowances and benefits are tax-free, which are taxable, and how much should be withheld each payday.

2) Big-picture changes introduced by TRAIN (starting 2018)

A. Personal & additional exemptions removed

Before 2018, employees (including teachers) enjoyed personal and additional (dependent) exemptions. TRAIN abolished those exemptions. You no longer subtract fixed personal/dependent amounts from income.

B. Higher zero-tax threshold via the tax tables

In place of those exemptions, TRAIN restructured tax brackets so that the first ₱250,000 of annual taxable income is taxed at 0%. This is not an “exemption” you claim; it’s simply how the tax table now works.

Implication: Many rank-and-file teachers still pay tax because their taxable income (after exclusions) typically exceeds ₱250,000/year, but their effective tax rates are generally lower than pre-TRAIN.

C. “13th month and other benefits” exclusion increased to ₱90,000

The ceiling for the exempt portion of 13th month pay and other benefits was raised to ₱90,000 per year (from the old ₱82,000). Amounts within ₱90,000 are excluded from taxable income; excess over ₱90,000 is taxable.

For government workers (including teachers), typical items counted in “13th month and other benefits” include the year-end bonus, mid-year bonus, and certain cash gifts/bonuses that are treated as “other benefits.” If the total of these items plus 13th month pay stays ≤ ₱90,000, that entire portion is tax-free.

D. De minimis benefits list updated (and still exclusive)

TRAIN and later regulations clarified what counts as de minimis benefits—small-value, specifically enumerated benefits that are always tax-exempt (and do not eat into the ₱90,000 cap). Typical examples include:

Uniform/Clothing allowance: up to ₱6,000 per year
Laundry allowance: up to ₱300 per month
Medical cash allowance to dependents: up to ₱1,500 per semester (or ₱250 per month)
Rice subsidy: up to ₱2,000 per month (or equivalent 50-kg rice, not exceeding the cap)
Employee achievement awards: non-cash, within prescribed caps
Gifts during Christmas and major anniversaries: up to ₱5,000 per year
Productivity incentive bonus (rank-and-file): up to ₱10,000 per year
Meal allowance for overtime/NCWHS/holiday work: subject to specific small caps
Small-value mementos/souvenirs within prescribed limits

If a benefit is not on the list, it is not de minimis (and is either taxable or, if it qualifies, part of the ₱90,000 “other benefits” exclusion).

E. MWE (Minimum Wage Earner) exemption retained—but rarely applies to teachers

TRAIN retained the MWE exclusion (basic pay + certain premium pays) first introduced under earlier laws. Public school teachers are typically not MWEs because their salary grades exceed the prevailing minimum wage. MWEs pay 0% income tax on their basic wages and certain premium pays—but this status generally does not cover public teachers.

F. Social contributions & select exclusions clarified

Mandatory employee contributions (e.g., GSIS, PhilHealth, Pag-IBIG) remain excluded from gross income. (Pre-TRAIN deductions like personal exemptions and small health insurance premium deductions were removed.)

3) What’s tax-exempt today for most public school teachers

Portion of compensation that falls in the 0% bracket under the TRAIN tax tables (ultimately a result of the ₱250,000 zero-tax band).
13th month pay and other benefits up to the ₱90,000 annual cap (combined).
De minimis benefits within their specific caps (do not consume the ₱90,000 cap).
GSIS, PhilHealth, Pag-IBIG contributions (statutory).
Proper reimbursements under an accountable plan (official travel/representation where you liquidate with receipts and return excess)—not income.
MWEs’ exempt pays—generally not applicable to public school teachers.

4) Common teacher allowances/benefits and their tax treatment

Note: Names and amounts may vary across budget years and issuances; the tax treatment follows the category, not the label.

Uniform/Clothing allowance (government) – Exempt as de minimis up to ₱6,000/year. Any excess is taxable (unless it qualifies under some other exclusion, which is rare).
Laundry allowance – Exempt as de minimis up to ₱300/month.
Rice subsidy – Exempt as de minimis up to ₱2,000/month (or equivalent).
Medical cash allowance to dependents – Exempt as de minimis up to ₱1,500/semester (or ₱250/month).
Christmas/Anniversary gifts – Exempt as de minimis up to ₱5,000/year.
Productivity Incentive Bonus (rank-and-file) – Exempt as de minimis up to ₱10,000/year.
Year-end bonus / Mid-year bonus / Cash gift (government) – Generally “other benefits”; exempt within the ₱90,000 cap (combined with 13th month). Any excess over ₱90,000 is taxable.
Teaching/Chalk/Classroom supplies allowance (cash) – Not on the de minimis list. Typically treated as “other benefits” and exempt only to the extent the ₱90,000 cap is not yet fully used; otherwise taxable.
Special Hardship Allowance (SHA) – A premium on basic pay for hardship posts. Treated as taxable compensation (not de minimis nor “other benefits”), unless a specific law/regulation expressly exempts it.
Honoraria (e.g., trainings, committees) paid as compensation – Taxable unless they qualify as “other benefits” and you still have room under the ₱90,000 cap.
Travel per diems/reimbursements – Not income if under an accountable plan (official purpose, liquidation with receipts, return of excess). Flat, non-accountable allowances are generally taxable.

5) How the ₱90,000 cap works (government examples)

Compute the sum of: 13th month pay, year-end bonus, mid-year bonus, cash gift, PBB/PEI/other “other benefits” that fall under this category.
If this sum ≤ ₱90,000, the entire sum is excluded from taxable income.
If it exceeds ₱90,000, the excess is taxable compensation and subject to withholding.

Important: De minimis items (e.g., clothing up to ₱6,000; rice up to ₱2,000/mo) do not count toward the ₱90,000. They are simply exempt on their own.

6) Withholding and payroll mechanics for teachers

Public school teachers are paid via government payroll systems that apply withholding tax tables reflecting the TRAIN brackets (including the 2023-onward lower rates scheduled by TRAIN).
Withholding is periodic, but the final tax due is based on annualized compensation. If you switch posts mid-year or receive irregular benefits late in the year, payroll may annualize (recompute) tax to reflect the full-year picture.
Substitution filing: Rank-and-file employees with a single employer the whole year and properly withheld taxes generally do not need to file an annual return; the employer’s BIR Form 2316 serves as the tax record. If you had multiple employers or other income, separate filing may be required.

7) Illustrative quick scenarios

Room left under the ₱90,000 cap
- Year-end bonus ₱40,000, mid-year bonus ₱40,000, cash gift ₱5,000, 13th month ₱30,000 → total “other benefits” = ₱115,000.
- Exempt: ₱90,000. Taxable excess: ₱25,000.
De minimis vs. other benefits
- Clothing allowance ₱6,000 (de minimis) → always exempt.
- Classroom supplies cash ₱5,000 (not de minimis) → counts toward the ₱90,000 cap; exempt only if cap not yet exhausted.
Hardship allowance
- Paid as a percentage of salary for a hardship post → taxable compensation (not covered by the ₱90,000 cap or de minimis exemptions).

8) Key do’s & don’ts for school heads and payroll units

Track each benefit by category: de minimis vs. other benefits vs. regular compensation.
Monitor the running total of the ₱90,000 cap per employee.
Ensure accountable-plan requirements (official purpose, liquidation, return of excess) for non-taxable reimbursements.
Issue BIR Form 2316 correctly and on time; implement annualization when needed.

Don’t

Treat a cash allowance as de minimis unless it’s explicitly on the list.
Forget that amounts over the ₱90,000 cap become taxable.
Assume MWE status for teachers—it typically doesn’t apply.

9) Frequently asked questions (teacher-specific)

Q1: Are public school teachers “tax-exempt”? No. Teachers pay tax under the employee tax tables. Certain benefits and amounts are excluded (₱90,000 cap; de minimis items; statutory contributions), but the salary and non-exempt benefits remain taxable.

Q2: Is the classroom/teaching supplies allowance tax-free? Not automatically. It’s not a de minimis item. It is exempt only if and while you still have room under the ₱90,000 “13th month and other benefits” cap; any excess is taxable.

Q3: Do clothing and rice allowances reduce the ₱90,000 cap? No. They’re de minimis (within caps), so they’re exempt on their own and do not consume the ₱90,000.

Q4: I received a Hardship Allowance. Is it tax-exempt? Generally taxable compensation (not de minimis; not part of the ₱90,000 cap). Absent a specific statutory exemption, withhold and tax it like salary.

Q5: If I work overtime or on holidays, are those pays tax-exempt? For MWEs, certain premium pays are exempt. Public school teachers are usually not MWEs, so premium pays are taxable as part of compensation.

10) Practical compliance checklist (for teachers)

Keep your pay slips and benefit breakdowns—know what category each payment falls into.
Track your year-to-date “13th month and other benefits” total versus the ₱90,000 cap.
Verify that de minimis caps are not exceeded; excess becomes taxable.
Confirm that GSIS/PhilHealth/Pag-IBIG are excluded from your taxable base.
If you had multiple employers or additional non-compensation income, check if you must file an annual return.

11) Bottom line

For public school teachers, the headline change in recent years was the TRAIN shift: no more personal/dependent exemptions, bigger zero-tax band baked into the tax tables, and a higher ₱90,000 exclusion for 13th month and other benefits. Teachers still pay tax on salary and on non-exempt benefits, but careful tagging of de minimis items and tracking of the ₱90,000 cap can legitimately minimize tax within the rules.

When in doubt, classify the payment first (de minimis vs. other benefits vs. regular compensation), check the specific cap, and then see how it interacts with the ₱90,000 ceiling and the annualized payroll computation.