Here’s a practitioner-grade explainer on Philippine tax incentives for employers who hire persons with disability (PWDs). I’m writing from statute and widely accepted practice (Republic Act Nos. 7277, 9442, 10524 and their IRRs; B.P. Blg. 344; National Internal Revenue Code (NIRC) principles). No browsing used, per your instruction.

Legal framework at a glance

Core statute: Republic Act No. 7277 (Magna Carta for Persons with Disability), as amended by R.A. 9442 and R.A. 10524 (which significantly expanded incentives and employment policies).
Implementers: Department of Labor and Employment (DOLE), National Council on Disability Affairs (NCDA), Local Government Unit PWD Affairs Office (PDAO), Department of Finance/Bureau of Internal Revenue (BIR).
Accessibility baseline: B.P. Blg. 344 (Accessibility Law) and its standards—relevant because one incentive covers costs to make workplaces accessible.
Income tax context: Incentives operate as additional deductions against taxable income (not credits), on top of ordinary and necessary business expenses under the NIRC.

What incentives exist?

1) Additional deduction for wages of PWD employees

Benefit: An additional deduction from taxable income equivalent to 25% of the actual salaries and wages paid to qualified PWD employees within the taxable year.
Nature: It is in addition to the normal deduction for salaries/wages. Practically, you deduct the salary expense once (as ordinary expense) and deduct an extra 25% of that salary amount as an incentive.
Scope: Available to private entities (corporations, partnerships, sole proprietors) that employ PWDs as regular employees (or at least under qualifying arrangements—see “Eligibility & conditions”).
Cap: No explicit statutory peso cap; bounded by the actual qualified wages and general anti-avoidance rules (must be bona fide compensation for services actually rendered).
When claimed: In the taxable year when wages are paid or incurred (consistent with your accounting method), provided substantiation is complete.

2) Additional deduction for accessibility improvements (reasonable accommodation)

Benefit: An additional deduction from taxable income equivalent to 50% of the direct costs and expenses incurred to improve or modify facilities or procure equipment that provide reasonable accommodation for PWDs.
Qualified spend: Ramps, elevators/lifts, accessible toilets, tactile signage, assistive tech, adaptive workstations, software/hardware enabling access, and other B.P. 344–consistent modifications directly necessary to enable PWDs to work.
Timing: Claimed in the year the cost is paid or incurred (again, consistent with your method), provided the facilities/equipment are actually installed and usable.
Interaction with capitalization rules: If the item is a capital asset (e.g., a lift), you still capitalize and depreciate it per NIRC; the 50% incentive is a separate, one-time additional deduction from taxable income.

These two are the principal tax incentives specific to employing PWDs in the Philippines.

Eligibility & conditions (what employers must satisfy)

For the 25% wage additional deduction

Qualified PWD status: The employee must be a person with disability within RA 7277/IRR definitions and properly documented (valid PWD ID or certification issued under the law).
Employment status: Generally intended for regular employment (or at minimum, sustained employment). Practice commonly follows IRR guidance that employment should not be merely transitory or tokenistic (e.g., at least six months of meaningful employment within the taxable year is typically observed in substantiation).
Bona fide employer–employee relationship: There must be payroll, timekeeping, and compliance with SSS, PhilHealth, and Pag-IBIG contributions and withholding taxes.
No double-incentivization: You cannot claim the same wages for another special wage-based additional deduction under a different incentive program on top of this 25% (avoid stacking beyond what statutes allow). Ordinary salary deduction remains intact.

For the 50% accessibility additional deduction

Direct nexus to PWD accommodation: The cost must be directly and exclusively incurred to accommodate PWDs (not general refurbishing). Following B.P. 344 helps demonstrate reasonableness.
Actually installed/used: Incentive is not based on purchase orders alone; the improvement/equipment should be installed, commissioned, and documented (photos, acceptance reports, permits if applicable).
Proper cost basis: Use net-of-VAT cost if you are VAT-registered and able to claim input VAT; use gross cost if you are not VAT-registered (consistent with general tax rules).

Substantiation & documentation (what the BIR typically looks for)

For PWD wages:
- Copy of PWD ID or official NCDA/PDAO/DOH-recognized certification.
- Employment contract or appointment letter identifying role, duties, and start date.
- Payroll registers, payslips, proof of withholding/remittance of taxes (Form 1601-C/Alphalist), and SSS/PhilHealth/Pag-IBIG payments.
- DOLE/NCDA/PDAO certifications where available under IRR (some RDOs ask for DOLE endorsement that the employer participates in PWD employment programs).
- Schedule computing the 25% additional deduction per employee and a year-end reconciliation to the general ledger.
For accessibility costs:
- Contracts/POs/invoices, ORs/BIR-registered invoices, delivery/installation reports.
- Building/occupancy permits or certificates of completion if construction/retrofit.
- Before/after photos; B.P. 344 compliance documentation (plans, specs).
- Asset registers (if capitalized), depreciation schedules, and a computation sheet showing the 50% incentive amount.
Return presentation:
- Maintain working papers showing ordinary deductions vs. additional deductions taken under RA 7277, by line item, to avoid commingling.
- Keep board/executive approvals authorizing the program and improvements.

How the math works (illustrative)

Scenario A: Wage incentive

PWD employee annual salary: ₱360,000
Ordinary deduction (salary): ₱360,000
Additional deduction (25%): ₱90,000
Total impact on taxable income: ₱450,000 (i.e., ₱360,000 + ₱90,000)

If your corporate income tax (CIT) rate is (for example) 25%, the tax saved from the additional deduction alone is ₱22,500 (₱90,000 × 25%). (You still also deduct the actual salary in full as an ordinary expense.)

Scenario B: Accessibility incentive

Install platform lift and widen doors (net-of-VAT direct cost): ₱2,000,000
Capex: capitalize and depreciate per NIRC (separate).
Additional deduction (50%) in the year incurred: ₱1,000,000
At 25% CIT, tax saved from the incentive alone: ₱250,000.

Note: If you’re under special regimes (e.g., income tax holiday where income tax is not due), the marginal benefit of additional deductions may be nil during the holiday period.

Interaction with other regimes & rules

VAT and PWD discounts: R.A. 10754 grants 20% discount + VAT exemption on certain purchases by PWDs. That regime benefits the PWD consumer, not the employer. It doesn’t generate a separate employer tax incentive (beyond ordinary tax treatment of sales).
BOI/PEZA: If you are under ITH or subject to GIE (e.g., 5%/special rates), the value of additional deductions may be diminished or inapplicable. Coordinate with your zone authority/BOI on how RA 7277 incentives interact with your fiscal regime.
Minimum wage & labor compliance: PWD employees are employees under labor laws. The tax incentive does not authorize deviations from minimum wage, OSH standards, or anti-discrimination obligations.
Non-discrimination and quotas: RA 10524 reserves at least 1% of government positions for PWDs. For the private sector, employers with more than 100 employees are encouraged to reserve at least 1% of positions for PWDs. While this is not a tax rule, alignment supports your documentation narrative and CSR reporting.

Procedural notes (claiming the incentives)

Internal policy: Issue an HR/Compliance memo adopting a PWD hiring policy and accommodation plan.
Register/verify: Ensure each PWD employee has valid PWD ID/certification; keep copies on file. If your LGU/PDAO issues IDs, ensure they’re current.
Coordinate with DOLE/NCDA/PDAO: Some RDOs look for DOLE endorsement or participation in PWD employment programs—secure letters/certificates when available.
Maintain evidence: Payroll, SSS/PhilHealth/Pag-IBIG, withholding tax remittances, accessibility project documents.
Compute & disclose: In your annual income tax return and tax notes, maintain schedules for the 25% and 50% additional deductions. Be prepared to present these during audit.

Compliance pitfalls to avoid

Token/short-term hires solely to claim the 25% add-on without genuine roles or sufficient tenure. Expect challenge on bona fide employment and substance.
Lack of PWD documentation (expired/unclear IDs; no certification trail).
Claiming the 50% deduction for general renovations not tied to PWD accommodation or B.P. 344 compliance.
Double dipping with other special additional deductions beyond what statutes allow.
Mismatch with VAT treatment (e.g., claiming the 50% bonus on VAT paid when you also claim it as input VAT—keep bases consistent).

Frequently asked questions

1) Is the 25% a tax credit? No. It’s an additional deduction from taxable income. Your tax saving = additional deduction × your income tax rate.

2) Can contractors or agencies claim the 25% for PWDs deployed to clients? You need a direct employer–employee relationship and payroll responsibility. Labor-only arrangements risk disallowance.

3) If a PWD becomes regular mid-year, can we claim for the whole year? Generally, claim pro rata for wages actually paid while qualified. Keep tenure/substance documentation.

4) Can we claim the 50% for software (e.g., screen readers, captioning tools)? Yes, if directly necessary to accommodate PWD employees (and duly documented as such).

5) What if we already must comply with B.P. 344? Compliance is mandatory; the law nonetheless grants an additional deduction to encourage faster/broader adoption. Ensure the spend genuinely targets PWD accommodation.

Quick compliance checklist (internal)

Board/management approval of a PWD hiring & accommodation policy
Copies of PWD IDs/certifications on file
HR files: job descriptions, contracts, performance records
Payroll + withholding + SSS/PhilHealth/Pag-IBIG proof
DOLE/NCDA/PDAO letters/certifications (if available)
Accessibility project files: permits, invoices, photos, acceptance, B.P. 344 notes
Year-end schedules: 25% wage add-on; 50% accessibility add-on
Consistency checks with VAT, capitalization, depreciation, special regimes (PEZA/BOI)

Bottom line

25% additional deduction for wages paid to qualified PWD employees.
50% additional deduction for direct costs of reasonable accommodation (facilities/equipment) for PWDs.
These are on top of ordinary deductions and aim to lower effective tax while embedding inclusive employment.

If you want, I can turn this into a short firm-style memo template or add sample footnotes/disclosures for your income tax return working papers.