What incentive does an employer get for hiring persons with disability?
Last updated: 2026-07-12 · Educational content; not legal advice.
Short answer
RA 7277 (Magna Carta for Persons with Disability) gives private employers tax incentives to hire PWDs. Section 8 grants an additional deduction from gross income equal to 25% of the total salaries and wages paid to PWD employees. Separately, a private entity that improves or modifies its physical facilities to provide reasonable accommodation for PWDs may deduct an additional 50% of the direct cost of those improvements from its net taxable income. These are on top of the usual expense deductions, to lower the after-tax cost of employing and accommodating PWDs.
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Frequently asked
How much can an employer deduct for PWD salaries?
Under RA 7277 Section 8, a private entity that employs PWDs may claim an additional deduction from gross income equal to 25% of the total salaries and wages paid to those PWD employees — over and above the ordinary salary expense deduction.
Is there an incentive for making a workplace accessible?
Yes. A private entity that improves or modifies its physical facilities to give PWDs reasonable accommodation may deduct an additional 50% of the direct cost of those improvements from its net taxable income, per RA 7277 Section 8.
Who can advise on claiming these incentives?
The employer should coordinate with the BIR for the tax mechanics and may consult the NCDA and DOLE on PWD employment programs. The PWD employee's status is evidenced by a valid PWD ID.
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Government IDs, pensions, and non-medical welfare for seniors, PWDs, solo parents, and poor families — how to get the senior citizen (OSCA) ID and its benefits (RA 9994), the monthly social pension for indigent seniors (RA 11916), the centenarian and milestone-age cash gifts (RA 10868 as amended by RA 11982), the PWD ID and who qualifies and the employer hiring incentive (RA 7277 as amended by RA 9442 and RA 10754), the Solo Parent ID and who counts as a solo parent and the 10% discount on baby needs (RA 8972 as amended by RA 11861), who qualifies for 4Ps and the cash-grant structure and conditions (RA 11310), the non-medical DSWD AICS help (burial, educational, transportation, food) and how to apply, replacing a lost ID, and your right to have these IDs issued free of charge without a fixer (RA 11032). The senior/PWD 20% purchase discount and DSWD medical assistance are in the Healthcare & Hospitals cluster.