MAGNA CARTA FOR

DISBALED PERSONS
GAMOS
RULE
VESTIL
DISABLED PERSONS/PERSONS WITH DISABILITY (PWD)

- are those suffering from restriction or different

abilities, as a result of a mental, physical or sensory
impairment, to perform an activity in the manner or
within the range considered normal for a human being.
Disabled persons are part of the Philippine society,
thus the State shall give full support to the
improvement off the total well-being of disabled
persons and their integration into the mainstream of
society. Toward this end, the State shall adopt
policies ensuring the rehabilitation, self-
development, and self-reliance of disabled persons.
It shall develop their skills and potentials to enable
them to compete favorably for available
opportunities. RA 7277 sec 2(a)
RIGHTS & PRIVILEGES OF PWD
EMPLOYMENT
EDUCATION
HEALTH
AUXILIARY SOCIAL SERVICES
TELECOMMUNICATIONS
ACCESSIBILITY
POLITICAL AND CIVIL RIGHTS
EMPLOYMENT
5% of all casual emergency and contractual positions in the
DSWD; Health, education, culture, and sports; and other
government agencies, offices or corporations engaged in social
development shall be reserved for disabled persons.

25% of the total amount paid as salaries & wages to disabled

persons allowed as additional deduction from gross income of
private entities

an additional deduction from net taxable income equivalent to

50% of the direct costs of the improvements/modifications
(reasonable accommodation for PWD) of private entities
TAX INCENTIVES FOR DONORS AND MANUFACTURERS

Any donation, bequests, subsidy or financial aid which may be made

to government agencies engaged in the rehabilitation of disabled
persons and organizations of disabled persons shall be exempt from
donors tax subject and shall be allowed as deductions from the
donors gross income for purposes of computing the taxable income.

Donations from foreign countries shall be exempt from taxes and

duties on importation

Local manufacturing or technical aids and appliances used by disabled

persons shall be considered as a preferred area of investment subject
to the provisions of the Omnibus Investments Code of 1987
INCENTIVES OF PWD
At least 20% discount & exemption from the VAT
(may be claimed as tax deductions by establishments based on the net cost of
the goods sold or services rendered)

1. Utilization of all services in hotels and similar lodging

establishments; restaurants and recreation centers
2. Admission fees charged by theaters, cinema houses, concert halls,
circuses, carnivals, and other similar places
3. Purchase of medicines in all drugstores
4. Medical and dental services, including diagnostic and laboratory
fees
5. Professional fees of attending doctors in all private hospitals and
medical facilities
6. fare for domestic air and sea travel for the exclusive use or
enjoyment of PWD based on the actual fare except promotional
fare.
7. public railways, skyways and bus fare for the exclusive use and
enjoyment of PWD
8. Funeral and burial services for the death of the PWD
 OTHERS
1. Educational assistance to PWD
2. To the extent practicable and feasible, the continuance of the same
benefits and privileges given by the GSIS, SSS, and PAG-IBIG, as the
case may be, as are enjoyed by those in actual service
3. special discounts granted by the government in special programs for
PWD on purchase of basic commodities
4. Provision of express lanes for PWD in all commercial and government
establishments; in the absence thereof, priority shall be given to them
CONDITIONS FOR AVAILMENT BY ESTABLISHMENTS
OF SALES DISCOUNTS AS DEDUCTION FROM GROSS
INCOME
1. The sales discount shall be deducted from gross income after
deducting the COGS or cost of service
2. Cost of the sales discount shall be allowed as deduction from gross
income for the same taxable year that the discount is granted
3. Only the portion of the gross sales exclusively used, consumed, or
enjoyed by the person with disability shall be eligible for the
deductible sales discount
4. Gross selling price and sales discount must be separately indicated
in the sales invoice or official receipt issued
5. Only the actual amount of the sales discount granted or a sales
discount not exceeding 20% of the gross selling price can be
deducted from gross income, net of VAT, if applicable, for income
tax purposes, and from gross sales or gross receipts of the business
enterprise concerned, for VAT or other percentage tax purposes;
and shall be subject to proper documentation

6. The business establishment giving sales discount to qualified PWD

is required to keep separate and accurate records of sales, which
shall include the name of the person with disability, ID number,
gross sales/receipts, sales discounts granted, date of transactions
and invoice number for every sale transaction to PWD
INCENTIVES FOR THOSE CARING FOR AND LIVING
WITH A PWD

PWD, who are within the 4th civil degree of consanguinity or affinity
to the taxpayer, regardless of age, who are not gainfully employed
and chiefly dependent upon the taxpayer, are treated as dependents
and individual taxpayers caring for them shall be accorded the
privileges granted under sec 35 of NIRC
Individuals or nongovernmental institutions establishing homes,
residential communities or retirement villages solely to suit the needs
and requirements of PWD shall have:
Realty tax holiday for the first 5 years of operation
Priority in the building and/or maintenance of provincial or municipal
roads leading to the aforesaid home, residential community or retirement
village.
SAMPLE PROBLEMS
 Elly, a 25 year old, is the secretary of Mrs. Grey. Because his job is
stable and his income is high, he decided to take care of Kaila, his 23 year old
sister who is a PWD. Elly pays for Kailas needs since Kaila lives with him.

If Kaila is his daughter and she is gainfully employed, how much additional
deduction should Elly claim?
If Kaila is his daughter and she is not gainfully employed, how much
additional deduction should Elly claim?
Based on the information above (that Kaila is his sister), and assuming that
Kaila is not gainfully employed, how much additional deduction should Elly
claim?
 Juan, the owner of Firefist, Inc., who has a disabled son, donated Php 500,000
to National Council on Disability Affairs (NCDA). The bank debited his bank account
for the amount of the check he issued to the organization.
The transaction was recorded in the books of Firefist, Inc. and the NCDA has
issued a certificate of appreciation to Juan for the help extended.
During the year, when the donation was made, the company has P1,200,000
gross income, P300,000 business expenses, and P5,000 bad debts (written off).

COMPUTE for the taxable income, income tax expense and donors tax of
the company
 In the first week of December 2015, Firefist, Inc. hired qualified PWD and
spent 10,000 to modify their physical facilities in order to provide reasonable
accommodation for disabled persons.
The company has a total of 450 employees. 20% of the labor force are PWD
qualified for the job of quality inspection. Only PWDs are assigned to quality
inspection. All the employees work for 5 days a week except for those assigned
for quality inspection who only work for 4 days a week, since the 5 th day of the
week is allocated for working on defective products. The employees are paid 400
pesos per day.
After a busy week, the company paid P 864,000.00 Salaries and Wages.

Compute for the total amount paid to the PWD employees

How much should be deducted from Firefists gross income?
Lolo Mariano, a 59 year old amputee who can no longer walk, went to the mall
with his grandson, Jake. The mall is located in another municipality and Lolo M
and Jake had to drive for hours to get to the said mall. While they were passing
by a shop, Jake saw a skateboard which costs P5,600.00, gross of vat. Since he
only has P5,000.00, he asked his lolo to buy it for him so that they could avail of
the vat exemption and discount.
Upon paying, lolo Mariano gave his PWD ID and gave P4,000 to the cashier in full
payment of the skateboard.

Compute for the discount

How much should lolo Mariano pay for the skateboard?
State the specific phrase in the Magna Carta for Disabled Persons which
would support the computations in the previous questions.
Janny, a PWD, brought his very hot girlfriend, Jane, to the mall to watch the
Fifty Shades of Green movie. The movie ticket costs P312.5, net of VAT. Janny
paid the tickets and was shocked that the total amount due is P630.00.
He asked the cashier about it and was given the computation below:
ticket for Janny P 312.5 x 80% x 1.12 = P 280.00
ticket for Jane P 312.5 x 1.12 = P 350.00
Total = P 630.00

The cashier told Janny that he is only entitled to the discount on his ticket and,
upon showing him a copy of RA No. 7277, that he is not entitled of Vat
exemption. Janny argued and said that he should have a Vat exemption and a
discount on both tickets. Since Janny came prepared, he took a hardcopy of RA
No. 10754, showed the cashier the amendment and gave the cashier P500.00 as
full payment.
Who among the two is right? And How much should Janny really pay for the
tickets?
-The End-