I. Overview: Is Retirement at 63 Allowed?

Yes—retiring at 63 is generally possible in the Philippines, but the right to retire and the benefits you receive depend on which retirement “track” applies:

Company retirement under a retirement plan / policy / CBA (the most common workplace route),
Statutory retirement under the Labor Code (RA 7641) when there is no retirement plan, and/or
Government social insurance benefits (mainly SSS for private sector; GSIS for most government personnel), which have their own age-and-service rules.

In private employment, “optional retirement” typically refers to retirement before the compulsory retirement age but after the minimum optional retirement age set by law or by the employer’s plan—whichever governs your situation.

II. Key Retirement Ages in Philippine Law and Practice

A. The “labor law” retirement ages (private sector; RA 7641 framework)

For employees covered by the Labor Code (private sector and certain government-owned/controlled entities not under the civil service retirement system):

Optional retirement age: 60
Compulsory retirement age: 65

This means that, as a baseline, an employee may retire at 60 or later (including at 63), and must retire at 65—but the ability to retire at 60–64 can depend on the retirement plan terms and the employee’s eligibility under those terms.

B. Why “60” does not automatically mean you can demand retirement at 63

Even with the statutory framework, retirement is often plan-based. Many employers implement retirement through:

a company retirement plan (registered or unregistered),
a collective bargaining agreement (CBA),
written policy in the employee handbook, or
employment contract provisions.

These instruments may:

require a minimum number of years of service (often 5 years, 10 years, 15 years, etc.),
set enhanced benefits above the legal floor, and/or
impose conditions for optional retirement (e.g., application windows, approvals, documentation).

However, company plans cannot give less than the minimum benefit required by law where RA 7641 applies.

III. The Three Main Sources of Retirement Benefits (and how they interact)

When someone retires at 63, they may receive one or more of the following:

Employer-paid retirement pay (company plan or RA 7641 minimum, if applicable)
SSS retirement pension (private sector) or GSIS retirement (government sector)
Other separation-related payments depending on circumstances (e.g., final pay, leave conversions)

A crucial point: Employer retirement pay and SSS/GSIS benefits are different. Receiving one does not automatically cancel the other, although some company plans may coordinate benefits (e.g., treating SSS as separate and still paying full plan benefits, or designing plan benefits to be “inclusive” so long as it remains compliant with the legal minimum where required).

IV. Private Sector: Retiring at 63 Under a Company Retirement Plan

A. Determine what your plan says

If your employer has a retirement plan/policy/CBA, it usually specifies:

Optional retirement age (commonly 60, sometimes earlier for special cases, sometimes later),
Compulsory age (often 65),
Minimum years of service and how service is computed,
Benefit formula (e.g., a multiple of salary and years of service),
Definition of salary (basic pay only? includes allowances? average of last 12 months?),
Mode of payment (lump sum, installments, annuity),
Procedure (notice, application, approvals).

If you are 63, you are within the usual “optional retirement window” (60–64) in many plans. Your benefit will be based on the plan’s formula—often more generous than the statutory minimum.

B. If plan benefits are less than the legal minimum

Where the employee is within RA 7641 coverage, the plan must not fall below the legal floor. If it does, the employee may claim the difference up to the minimum required.

V. Private Sector Without a Retirement Plan: The Statutory Minimum (RA 7641)

If there is no retirement plan or it provides less than the statutory minimum, the law supplies a minimum retirement pay for eligible employees.

A. Who is covered?

In general, RA 7641 provides a minimum retirement pay for employees in the private sector who are not covered by a retirement plan, and who meet the eligibility requirements.

Certain categories may be treated differently depending on classification (e.g., managerial staff are still employees; some domestic workers have special rules; and some employees may already be covered by specific arrangements). The practical rule: start by checking if there is a company plan; if none, RA 7641 minimum commonly applies.

B. Eligibility: age + service requirement

For optional retirement under the statutory minimum:

At least 60 years old, and
At least 5 years of service with the employer

At 63, you meet the age threshold. You must still satisfy the service requirement.

C. Minimum retirement pay computation (conceptual)

The statutory minimum is commonly described as:

At least one-half (1/2) month salary for every year of service,
with a fraction of at least six (6) months considered as one (1) whole year.

“1/2 month salary” for this purpose is not just 15 days basic pay in everyday language. It is typically understood to include:

15 days basic salary, plus
1/12 of the 13th month pay, plus
the cash equivalent of not more than 5 days of service incentive leave (SIL)

This minimum formula is the usual baseline for RA 7641 retirement pay when there is no plan.

Notes on salary base and inclusions/exclusions

The computation generally uses basic salary (and the plan or law-defined “salary” base), not necessarily all allowances.
Certain allowances may be included if they are treated as part of regular wage, depending on how they are characterized and paid.
The “not more than 5 days SIL” component is a cap in the statutory formula.

D. Example structure (without using specific numbers)

If you retire at 63 after X years and Y months:

Determine credited years of service (rounding up if the fraction is ≥ 6 months).
Compute “1/2 month salary” under the statutory definition.
Multiply by credited years of service.
Ensure any plan benefit is not less than this floor (if a plan exists but is inferior).

VI. Can an Employer Refuse Your Optional Retirement at 63?

It depends on the governing rule:

A. If the plan grants an employee the option

If the plan or policy clearly provides that an employee may retire upon reaching a certain age and meeting service requirements, the employer is generally expected to honor it—subject to the plan’s procedures.

B. If there is no plan and RA 7641 applies

Retirement is a recognized mode of employment termination with benefits. If the employee is qualified (age and service), the statutory minimum is due. In practice, employers may require the employee to apply or submit notice, but they should not use that as a pretext to deny lawful benefits.

C. Special case: when the “retirement” is actually a resignation

An employee who leaves at 63 without satisfying plan/RA 7641 requirements may be treated as having resigned, which generally does not carry statutory retirement pay. You would still receive:

final pay (unpaid wages),
pro-rated 13th month pay,
and other earned benefits (e.g., unused convertible leaves), as applicable.

VII. Relationship Between Employer Retirement Pay and SSS Benefits (Private Sector)

A. You can receive both

Employer retirement pay (company plan or RA 7641 minimum) is separate from SSS retirement benefits. Many retirees receive:

a lump sum (or plan benefit) from the employer, and
a monthly pension (or lump sum depending on SSS rules/eligibility) from SSS.

B. Timing mismatch is common

You can retire from employment at 63, but SSS may have:

its own age requirement for old-age retirement, and
conditions relating to number of contributions.

If you retire from work before meeting SSS retirement eligibility, you might:

delay claiming SSS retirement until you reach the qualifying age, or
claim a different SSS benefit if eligible (e.g., disability), if applicable.

C. Company plan coordination

Some company plans “integrate” or “coordinate” with SSS. A plan may state that its benefit is in addition to SSS, or that it is net of certain amounts—subject to the requirement that legal minimums are met where applicable.

VIII. Government Employment: Retiring at 63 Under GSIS (General Guide)

If you are a government employee under the civil service with GSIS coverage, your retirement options depend on:

your age,
your length of government service, and
the specific retirement mode applicable to you (there are multiple GSIS retirement frameworks, depending on entry date and coverage).

At 63, many government employees are above typical minimum age thresholds, but the controlling factor often becomes length of service and the applicable GSIS law to your membership. Benefits can include:

pension, lump sum, or a mix,
survivorship features,
and different computation methods.

Because GSIS regimes can vary by employment history and legal coverage, the accurate determination of “what benefits apply” at 63 in government service hinges on the exact GSIS retirement mode applicable to your service record.

IX. Other Benefits Commonly Payable Upon Retirement at 63

Even when retirement pay is the centerpiece, retirees commonly receive:

Final pay / last salary (unpaid wages up to last working day)
Pro-rated 13th month pay up to separation date
Leave conversions if company policy or CBA provides cash conversion of unused leaves
Tax treatment considerations
- Certain retirement benefits can be tax-exempt if conditions under tax rules are met (including plan nature and qualifying circumstances). Tax outcomes depend heavily on whether the retirement is under a qualified plan and the employee’s situation.

X. Tax Treatment: Important Practical Considerations

Retirement tax treatment in the Philippines is highly rule-driven. In many cases:

Retirement benefits received under certain compliant/qualified conditions may be excluded from taxable income, subject to the applicable requirements (e.g., retirement plan structure, age/service conditions, and whether it is the employee’s first retirement claim under the rule being invoked).
Amounts not covered by an exemption can be treated as taxable compensation or subject to withholding rules depending on classification.

Because the tax exemption depends on the legal basis of retirement (plan-based vs statutory minimum) and other qualifying conditions, retirees should ensure:

the employer classifies the payment correctly in payroll/tax reporting, and
documentation supporting the tax treatment is complete.

XI. Practical Checklist: If You Want to Retire at 63

A. Identify your governing framework

Private sector with a company plan? → Follow plan/CBA rules (ensure not below statutory floor where applicable).
No plan? → Consider RA 7641 minimum requirements (age ≥ 60; service ≥ 5 years).
Government? → Check GSIS retirement mode applicable to your membership and service record.

B. Confirm eligibility

Age: 63 meets typical “optional retirement” threshold under labor law norms.
Service: confirm years of credited service and rounding rules.
Salary base: determine what is included in “salary” for computation.

C. Gather documents

Service record / employment certificates / payroll records
Retirement plan provisions or CBA extracts
Latest payslips and 13th month documentation
Leave balances and conversion policy

D. Align timing

Decide last working day and ensure notice/application requirements are met.
Clarify payout schedule (lump sum vs installments).
Separately plan the timing for SSS or GSIS claims.

XII. Common Misconceptions

“At 60, I automatically get retirement pay even if I resign.” Not necessarily. Retirement pay generally requires meeting retirement eligibility under a plan or statutory rules. Otherwise, leaving may be treated as resignation with final pay only.
“SSS retirement is the same as employer retirement pay.” They are separate systems. Employer retirement pay is an employment benefit; SSS is social insurance.
“If my company has a plan, RA 7641 doesn’t matter.” If the plan is inferior to the statutory floor in a situation where the statutory minimum applies, the employee may claim at least the legal minimum.
“Optional retirement means the employer can deny it at will.” Optional refers to the employee’s right to choose retirement within the allowed window, subject to eligibility and plan procedures—not a license to deny lawful benefits.

XIII. Bottom Line

Yes, you can retire at 63 in the Philippines in many situations because 63 sits within the common optional retirement window (between 60 and 65 in private employment norms).
What benefits apply depends on whether you are retiring under:
- a company plan/CBA,
- the statutory minimum retirement pay rules (commonly: age ≥ 60 and service ≥ 5 years; minimum formula of 1/2 month salary per year of service under the statutory definition), and/or
- SSS (private sector) or GSIS (government), each with its own eligibility conditions.
In addition to retirement pay, retirees typically receive final pay, pro-rated 13th month, and other earned benefits, with tax treatment depending on the governing retirement basis and compliance conditions.