When is the start of salary deduction of SSS loan?

Since many have been trying to ask us regarding details on when is the actual start date of salary deduction after receiving the cheque / check for the SSS salary loan, we decided to post it here via a short discussion. According to the official Social Security System (SSS) website, the first deduction from their salaries shall start on the second month following the date of loan.

• For employed member-borrower (including participants of the fast track program), the first deduction from their salaries shall start on the second month following the date of loan
• All remittances shall be made on or before the 10th day following the applicable month of deduction to the SSS or to any of its authorized banks.
• The employer shall be responsible for the collection and remittance to the SSS of the amortization(s) due on the member-borrower’s salary loan through payroll deduction.
• With respect to late remittance penalties and transfer of new job, – The employee is obliged to report to the new employer his obligations with SSS and shall allow the new employer to deduct from his salary the corresponding amortizations due, plus any penalty for late remittance of amortizations.

For those asking about matters on loanable amount and how does the SSS determine the exact cash fund that an active SSS member can expect to get upon application of a SSS salary loan, the details are as follows below.

How much is the loanable amount?

1. A one-month salary loan is equivalent to the average of the member’s latest 12 monthly credits posted.
2. A two-month salary loan is equivalent to twice the average of the member’s latest 12 monthly salary credits posted (rounded to the next higher monthly salary credit), but not to exceed P24,000.

If you are self-employed or Voluntary Paying Member:

For self-employed or voluntary paying member-borrowers, the first amortization shall be paid to the SSS or any of its authorized banks on or before the 10th day of the third month following the date of loan.

Employers and Employee, Please do Note These Facts:

What are the obligations of the employer to the SSS?

• The employer shall be responsible for the collection and remittance to the SSS of the amortization(s) due on the member-borrower’s salary loan through payroll deduction.
• The employer shall require new employees to secure from the SSS an updated statement of account.
• The new employer shall continue the deduction and shall be accountable for remittance to the SSS.

In case of transfer, separation, or resignation, how can a borrower pay back the loan?

• In case a member-borrower is separated voluntarily, (e.g. retirement or resignation) or involuntarily, (e.g. termination of employment or cessation of operations of the company), the employer shall be required to deduct the total balance of the loan from any benefit(s) due to the employee and shall remit the same in full to SSS.
• If the benefit(s) due the employee or the amount thereof legally available for offset of obligations of the employee is insufficient to fully repay the loan, the employer shall report the unpaid loan balance to SSS.

In case of member-borrower’s death, total disability or retirement, what happens to the unpaid loan?

In case of member’s’s death, total disability or retirement under the Social Security Act, the entire amount or any unpaid amount of the loan as well as the interest and penalty thereon, If any,shall be deducted from the corresponding benefit.

What are the papers/documents needed for filing a salary loan?

• An employed member shall submit an accomplished SSS Form ISL-101 (Member Loan Application Revised March 2004) and present the digitized SSS ID cards or E-6 acknowledgement stub with 2 (2) IDs listed below one of which with recent photo and date of birth.
• A self-employed, voluntary member, overseas worker, non-working spouse, farmer or fisherfolk and house hold-helper shall submit an accomplished SSS Form ISL-101 and present the digitized ID card or E-6 acknowledgement stub with any two (2) of the following valid IDs,one of which with recent photo and date of birth.

• Unexpired Driver’s License
• Professional Regulation Commission (PRC) ID Card
• Passport
• Postal ID
• School or Company ID
• Tax Identification Number Card (TIN)

Where can a borrower file the salary loan application?

A borrower may file the salary loan application at the nearest SSS branch or representative office.

Source: sss.gov.ph

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