Memorandum Circular No.

2022-105

GUIDELINES ON THE
IMPLEMENTATION OF THE
SALARY DEDUCTION SCHEME FOR
THE AWARDS/ACCOUNTS OF NHA
PERMANENT EMPLOYEES
I. BACKGROUND
 To help improve the quality of life of the NHA employees,
lot/housing units were awarded to deserving/qualified
employees in the NHA projects nationwide and this is a
continuing benefit provided to the existing workforce.

 Data show that most of these employees have fully paid their
accounts while some have incurred arrearages and have not
updated their accounts per report of the Regional Offices.

 The implementation of salary deduction scheme will ensure

timely payment of lot/housing loan amortizations, ensure
employee’s accounts are up-to-date, and help them avoid
incurring penalty charges.

 This will result to improved collection performance that will

significantly enhance the financial capability and stability of
the Authority.
II. OBJECTIVES
2.1 To increase collection and recover
investment for NHA financial stability;
2.2 To ensure updating of employees’
accounts and avoid incurring penalty charges
through salary deduction scheme; and
2.3 To establish the guidelines that will
harmonize existing issuances on salary
deduction schemes for the award and accounts
of NHA permanent employees. 
III. SCOPE AND COVERAGE
These guidelines shall cover all existing
and future awards of NHA permanent
employees under installment sales for both
residential and commercial lots/units in all
the project sites of the Authority.
IV. DEFINITION OF TERMS
1. Authorized Deductions – refer to the deduction from salaries,
emoluments or other benefits authorized by the NHA permanent
employees as payment of an employee’s obligations.
2. Authority to Deduct (ATD) – refers to the document executed by the
NHA permanent employee authorizing the NHA Main and Regional
Offices to deduct from his/her monthly salary or total compensation
a specific amount for the payment of monthly amortizations upon
separation from the Authority due to retirement, resignation or any
other circumstances.
3. Mandatory Minimum Monthly Net Take-home Pay – refers to the
minimum monthly net take-home pay of government employees
which shall not be lower than Five Thousand Pesos (₱5,000.00) or as
provided by the General Appropriations Act (GAA).
4. Salary Deduction Scheme – refers to the payment scheme wherein
NHA permanent employees authorize the NHA Main and Regional
Offices to deduct from their monthly salary a specific amount for the
payment of monthly amortizations.
V. SPECIFIC GUIDELINES
5.1 All Estate Management Unit (EMU) of
the Regional Offices shall come up with an
updated master list of NHA permanent
employees with awards in their respective
jurisdiction based on the initial list provided
by the Financial Services Group (FSG) as
coordinated with Estate Management
Department (EMD) and Human Resource
Management Department (HRMD).
5.2 Execution of Authority to Deduct
5.2.1 The Finance Unit (FU) of the Regional Offices shall issue the Statement
of Account (SOA) together with the Authority to Deduct (ATD) (Annex A) to all
account holders based on the master list.
5.2.2 All NHA permanent employees whether new applicants or with
award/account shall be required to accomplish and sign the ATD, which will then
be endorsed by the respective Regional and Staff Departments to District
Manager of project concerned where the award is located. This scheme shall be
implemented on a regional level.
5.2.3 All Regional Managers and Department Managers shall take full
responsibility in ensuring the compliance of their concerned NHA permanent
employees with the ATD on the prescribed timelines.
5.2.4 The ATD shall specify that the NHA Main or Regional Office shall be
authorized to deduct from the salaries/wages/allowances the amount
representing the minimum one (1) month amortization on the date specified in
the document.
5.2.5 In cases where the employee’s award/account is subject to escalating
amortizations, the employee shall allow the deduction of the prevailing amount
of amortization based on the schedule encoded in the Billing and Collection
System (BCS).
 ANNEX A

AUTHORITY TO DEDUCT

In view of the lot/housing unit awarded to me in Lot ___, Block ___, Phase ___,
_________Project_/Location_________, with the total amount of ______________pesos , I
hereby authorize NHA Main / Region ______Off ice to deduct from my monthly
salaries/wages/allowances the amount of _ Pesos (P ), representing the
monthly amortization beginning .

Likewise, if my award/account is subject to escalating amortizations, I hereby allow the deduction

of the effective/prevailing amount of amortization based on the schedule encoded in the Billing and
Collection System (BCS).

Further, this is to authorize the deduction from the proceeds of my terminal leave upon retirement
or from the total compensation due me upon my separation the amount equivalent to the total
arrearages which remain unpaid after my last day in service.

In case my salary will fall below the mandatory minimum monthly net take-home pay as provided
in the General Appropriations Act (GAA) or if NHA inadvertently fails to collect my payment through
salary deduction, I will directly pay my monthly amortization to the NHA to avoid penalty charges.

I acknowledge that failure to pay three (3) monthly installments shall cause the cancellation of my
award and I may be subjected to summary eviction in accordance with the provision of the
Conditional Contract to Sell (CCS).

It is understood that this Authority to Deduct shall continue to be in effect for as long as I am
employed with National Housing Authority or until such loan is fully paid.

NAME OF AWARDEE
(Signature over printed name)

Place of Assignment: ______________

Employee’s Complete Address:

Borrower’s Contact Details:

Position/Designation:_____________
Group/Region/Department/District___
Tel. No. : _______________
Cell Phone No. : _______________
Email Address : ______________
5.3 Procedure of Salary Deduction Scheme (Annex B-1 and B-2)
5.3.1 The Finance Unit shall disseminate/forward the list of NHA
permanent employees with award/account in their jurisdiction for salary
deduction (Annex C), to the Accounting Department (for employees assigned
in the Main Office) or Finance Unit of concerned Regional Office (where the
employee is assigned).

OFFICE ASSIGNMENT PROCEDURE

1. Main Office Accounting Department shall consolidate the list
of NHA permanent employees with accounts
assigned in the Main Office and forward this to
HRMD. Based on the said list HRMD shall proceed
with the salary deduction.
2. Regional Office Finance Unit shall consolidate the list of NHA
permanent employees with accounts assigned in
their Regional Office and forward the list to
Administrative Unit. Salary deduction shall be
done by the Administrative Unit.
 ANNEX C
NATIONAL HOUSING AUTHORITY
LIST OF EMPLOYEES FOR SALARY DEDUCTION
Region _________
For the Period of ________

Beneficiary Salary Deduction FY 202__

Employee Place of Outstanding Amortization Arrearages as Total Amount
Identification No. Name
No. Assignment Balance FY 2022 of Year 2022 Due FY 2022 Jan Feb Mar Apr May Jun Jul Aug Sept Oct Nov Dec
(BIN)

Prepared by: Reviewed by: Certified Correct:

5.3.2 The list of NHA permanent employees for salary deduction shall be
submitted annually, on or before the last working day of November. In case
of new awards/accounts, the Finance Unit shall immediately submit an
updated list to Accounting Department or the concerned Regional Office.

5.3.3 If an employee is reassigned from Main Office to the Regional

Office, the HRMD shall formally inform the Accounting Department and
Regional Office of such transfer for deletion on the list of NHA permanent
employees for salary deduction in Main Office payroll, and for inclusion on
salary deduction in Regional Office payroll.
The Accounting Department shall provide the photocopy of ATD previously
accomplished by the employee to Regional Office where the employee was
reassigned.

5.3.4 If an employee is reassigned from Regional Office to Main Office or

from Regional Office to other Regional Office, the originating Regional
Office shall formally inform the Accounting Department or other Regional
Office of such transfer, for salary deduction in Main Office or the concerned
Regional Office Payroll.
5.3.5 The certification of all deductions from the Main Office or
last originating Regional Office and photocopy of the ATD shall be
attached to the Disbursement Voucher (DV) in the processing of the
reassigned employee’s first salary.

5.3.6 For NHA permanent employees with an outstanding balance

for salary deduction, the amount in arrears, if any, shall be indicated
in the clearance of the reassigned employees.

5.3.7 The Accounting Department and Regional Finance Unit shall

ensure that the salary deduction of the reassigned employee will be
deducted immediately, to avoid arrears and penalty charges.

5.3.8 The implementation of the salary deduction scheme shall

ensure that the monthly net take home pay of the NHA permanent
employee after all the authorized deductions shall at all times not be
lower than Five Thousand Pesos (₱5,000.00) or as provided by the
General Appropriations Act (GAA).
5.3.9 In the event that the total authorized deductions shall reduce the
NHA employee’s mandatory minimum monthly net take-home pay,
authorized deductions shall be prioritized in the order of hierarchy of
payments. Monthly amortizations under the salary deduction scheme shall
immediately come after the statutory deductions, GSIS loans, and Pag-IBIG
loans.
Illustration:

Basic Salary P xxx

PERA xxx
Total Earnings
xxx

Less: Deductions
Withholding Tax (xxx)
Philhealth Contribution (xxx)
GSIS Contribution (xxx)
HDMF (Pag-ibig) Contribution (xxx)
GSIS Loans (xxx)
HDMF (Pag-ibig) Loans (xxx)
NHA Employees House & Lot Award (xxx)
PFAI Loans (xxx)
PFAI Welfare Fund (xxx)
Total Deductions ___ (xxx)

Net Pay P xxx

5.3.10 Any deficiency in the required monthly
amortization payments of the NHA employee as
a result of the mandatory minimum monthly
take-home pay shall be addressed through
direct payment arrangements to be voluntarily
made by the employee through the issuance of
post-dated checks, cash payments to the NHA
Cashiers and such other payment options that
may be made available in the future.
5.4 Remittance of Salary Deduction
5.4.1 The Accounting Department shall issue a memorandum
request supported by the Remittance List to the Treasury
Department for fund transfer of the amount deducted from the
salary of the concerned employee.
5.4.2 The Treasury Department shall immediately provide
Accounting Department with a copy of the validated Authority to
Debit/Credit Account to support the remittance thru Fund
Transfer Letter Advice (FTLA).
5.4.3 The Finance Unit of Regional Offices shall prepare DV and
remit amount of salary deduction to the respective bank accounts
maintained by the Main Office for specific programs (e.g.,
General Fund Account, GEHP Account, or AFP/PNP Account).
5.4.4 Amortizations due for the month may be remitted on the
same month but not later than the 5th day of the following month.
5.4.5 The Accounting Department and Regional Office Finance
Units shall submit a copy of the Remittance List (Annex D),
Validated Fund Transfer Letter Advice, or deposit slip, to the
respective Regional Office where the award of the concerned
employee is located for posting in the Billing and Collection System
(BCS).
ANNEX D
NATIONAL HOUSING AUTHORITY
Remittance List from Payments thru Salary Deduction
Region ____________
For the Month of __________________

Amount of Salary
Name of Employee/Awardee Employee Number Project Block & Lot BIN
Deduction
1.
2.
3.
4.
5.
6.
7.
8.
9.
10.

Prepared By: Reviewed by: Certified Correct:

5.4.6 For remittance made through fund transfer or deposit,
the employee’s pay slip or the validated FTLA shall suffice as
proof of payment of the monthly amortization. If payment is
made through the cashier, the official receipt issued by NHA
Cashier shall serve as proof of payment.

5.4.7 The remittance list shall be the basis for posting in the
BCS. The Corporate Operations and Systems Development
Department (COSDD) shall modify the existing utility
program for this purpose. It shall be the responsibility of FU
to ensure the accuracy of encoding in the BCS the
deductions reflected in the remittance list.
5.4.8 For uniformity in recording in the accounting books of entry, please
refer to the sample computation and accounting entries (Annex E).
ANNEX E

Sample Accounting Entries - Salary Deduction Scheme

A. PAYROLL MAIN OFFICE B. PAYROLL REGIONAL OFFICES

Books Accounting Entries Debit Credit Books Accounting Entries Debit Credit

1) GJ Salaries 200,000.00 1) LV/GJ Salaries 200,000.00

Due to BIR 40,000.00 Due to BIR 40,000.00
Due to GSIS 18,000.00 Due to GSIS 18,000.00
Due to Philhealth 3,982.86 Due to Philhealth 3,982.86
Due to Pag-ibig 1,000.00 Due to Pag-ibig 1,000.00
Other Payables-Miscellaneous-PFAI 6,000.00 Other Payables-Miscellaneous-PFAI 6,000.00
Undistributed Collection 11,000.00 Undistributed Collection 11,000.00
Cash in Bank (General Fund) 120,017.14 Advances for Operating Expenses 120,017.14

To recognize payment of salaries for the month. To recognize payment of salaries for the month.

2) GJ Cash in Bank 11,000.00 2) LV/GJ Cash in Bank 11,000.00

Cash in Bank (General Fund) 11,000.00 Advances for Operating Expenses 11,000.00

To recognize remittance thru Fund Transfer Letter Advice To recognize remittance thru Fund Transfer Letter Advice
(FTLA) as per attached Remittance List and Validated FTLA (FTLA)/Deposit as per attached Remittance List and Validated
FTLA or Validated Deposit Slip.

3) CRDJ Undistributed Collection 11,000.00 3) CRDJ Undistributed Collection 11,000.00

Cash Collecting 10,000.00 10,000.00 Cash Collecting 10,000.00 10,000.00
Cash in Bank 10,000.00 Cash in Bank 10,000.00
Loans Receivable 20,000.00 Loans Receivable 20,000.00
Amortization Interest 500.00 Amortization Interest 500.00
Deliquency Interest 500.00 Deliquency Interest 500.00

To recognize collections and deposits per CRR To recognize collections and deposits per CRR
(Assume that P10,000.00 were collected from Regular (Assume that P10,000.00 were collected from Regular
Collection/Other Awardees) Collection/Other Awardees)
5.5 For NHA Permanent Employees with Arrearages:
5.5.1 The NHA permanent employees with arrearages, regardless of
the number of cumulative months of their arrearages and applicable
interest rates, shall be allowed to apply for revised credit terms in the
proper Regional Office pursuant to MC 2317.
Illustration:
*Assuming monthly amortization is Php 750.00

Principal as of November 2022 Php 24,903.15

Amortization Interest - @ 9% per annum 14,823.15
Delinquency Interest 5,375.00
Outstanding Balance (before application of MC No. 2317) Php 45,101.30
Less: Php 750 amortization for December 2022
Amortization Interest - @ 6% per annum
(Php 45,101.30 x 0.06/12) (225.51)
Credit (524.49)
Outstanding Balance as of December 2022 Php 44,351.30

5.5.2 An amount equivalent to the amortization based on the

approved revised credit terms shall be deducted every month from the
salary of NHA permanent employees as stipulated in the ATD.
5.6 For Retired or Separated NHA Permanent Employees

5.6.1 For NHA permanent employees who are applying for

retirement or separation from service, the status of
accounts/awards shall also be subject to approval of the
Accounting Department as part of the general clearance.
Arrears if any, are considered due and demandable, and
shall be settled prior to the issuance of the clearance.

5.6.2 Outstanding balance of retired or separated NHA

permanent employees equivalent to the total amount of
the arrearages shall be deducted from the proceeds of
terminal leave upon retirement or from the total
compensation due upon separation/resignation.
5.6.3 For NHA Permanent Employees Who are Applying
for Retirement (Optional or Compulsory)
a. NHA permanent employees who previously authorized the
deduction of monthly amortization from his/her salary shall have
the option to authorize deduction of the amount equivalent to the
total arrearages due upon retirement from the proceeds of their
terminal leave to make their account up-to-date. The retiring NHA
permanent employee shall be allowed to amortize the outstanding
balance for the remaining life of the contract through direct
payment arrangements to be voluntarily made by the employee
and subject to interest/delinquency as may be applicable.
b. In the event the amount of the total compensation due upon
retirement is insufficient to cover the entire amount of arrearages
which remain unpaid after the last day in service, the remaining
balance shall be paid through direct payment arrangements to be
made by the NHA permanent employee either through payment to
NHA Cashiers, issuance of post-dated checks and other payment
options that may be made available in the future
c. The retired NHA permanent employee shall execute a duly
notarized Deed of Undertaking (Annex G), stating that
failure to comply with the obligation shall result to
cancellation of his/her contract. Thereafter, he/she shall
be considered a mere illegal occupant and shall be evicted
summarily pursuant to Section 2 of Presidential Decree
1472 dated June 11, 1978.

d. Failure to comply with the abovementioned will result to

cancellation of the award pursuant to NHA Memorandum
Circular No. 2506 dated April 25, 2013.
 ANNEX G
DEED UNDERTAKING

KNOW ALL MEN BY THESE PRESENTS:

This DEED made and executed by _______________________________, of legal age,

Filipino, single/married to ___________________________, with residence and postal address
at ______________________________________________.

WITNESSETH: That

1. I am the awardee of National Housing Authority of _______________________________

located at ______________________________________________________________.
2. Due to my separation/retirement from government service, I would like to continue the
payment of monthly amortization of my outstanding balance over the abovementioned
lot/unit for the remaining life of the contract through direct payment arrangements to NHA.
3. I promise to pay my obligation over the subject property in the total amount of
_______________________________________ (P____________) with the first monthly
payment due on or before _______________________ and the subsequent payments
within the first five (5) days of the month.
4. I understand that should I fail to tender any three (3) consecutive monthly payment on or
before the due date, I shall lose all rights or interests over the subject property with all the
payments made for said property forfeited in favor of NHA.
5. Should I fail to pay as promised, I shall voluntarily vacate the lot/unit within ten (10) days
from receipt of an Eviction Notice from NHA and my failure to vacate the premises shall
give right to the NHA to pursue summary eviction against me pursuant to Section 2 of P.
D. 1472.

IN WITNESS WHEREOF, I have hereunto affixed my signature below this ________ day of
____________ 202__.

_____________________________
Awardee/Heir

Signed in the presence of:

_____________________________ _____________________________
NHA Officer NHA Officer

ACKNOWLEDGMENT
5.6.4 For Permanent Employees Who are Separated from
NHA Due to Resignation or Any Other Circumstances
a. For separated NHA permanent employees, the total amount of
arrearages which remain unpaid after the last day in service shall be
deducted from the total compensation due upon separation or
resignation of the employee in accordance with the terms stipulated
in the ATD.
b. Separated NHA permanent employees with arrearages, regardless of
the number of cumulative months of their arrearages and applicable
interest rates, shall be allowed to apply for the revised credit terms
in the Regional Office pursuant to MC 2317.
c. The separated NHA permanent employee shall be allowed to amortize
the outstanding balance for the remaining life of the contract
through direct payment to NHA Cashiers, or issuance of post-dated
checks or other payment options that may be made available in the
future.
d. The separated NHA permanent employee shall be required to execute
a duly notarized Deed of Undertaking and failure to comply with the
obligation will result to cancellation of the award.
5.7 For matured accounts
The relevant provisions of MC No. 2018-003 dated
February 21, 2018 shall apply to settlement of obligations
of matured accounts.

5.8 Application for reduction of interest rate

NHA permanent employees may apply for the reduced
amortization interest of 3% under MC No. 2021-048 dated
November 10, 2021.
5.9 Incentives pursuant to MC No. 2219 dated February 4,
2009 and MC No. 2219-A dated March 24, 2010
5.9.1 Incentive for Updated Accounts
For accounts with updated monthly payments within a
cumulative period of six (6) months, an amount equivalent to
fifty percent (50%) of monthly amortization shall be credited to
the outstanding principal balance account.

The same incentive shall thereafter be granted every six (6)

months provided that the account remains updated every
month within cumulative 6-month period.
Illustration:
*Assuming monthly amortization is Php 750.00 and the account remains updated
within the period July-December 2022

Outstanding Balance as of November 2022 Php 80,600.05

Less: 50% of Monthly Amortization
(Php 750 x 0.50) ( 375.00)
Outstanding Balance as of December 2022 Php 80,225.05
5.9.2 Incentive for Full Payment
For full settlement of account, a twenty percent (20%) rebate
shall be granted to the outstanding principal balance.

Illustration:
*Assuming monthly amortization is Php 750.00 and the account remains updated
within the period July-December 2022

Outstanding Balance as of November 2022 Php 80,600.05

Less: 20% Rebate ( 16,120.01)
Total amount to pay in full Php 64,480.04
VI. MONITORING
6.1 Accounts Management Division - Financial Services Group (AMD-FSG) shall
monitor the compliance of all Regional Offices to this Circular, particularly with
the required execution by NHA permanent employees of ATD as stated in Item
No. 2, Specific Guidelines of this MC.
6.2 The Finance Unit of Regional Offices shall submit quarterly to AMD-FSG the
list of NHA permanent employees that have accomplished and submitted the
required ATD within their jurisdiction, every fifth (5th) day of the month
following the end of the quarter. This shall commence one (1) month after the
effectivity of this Circular (Annex F).
ANNEX F
NATIONAL HOUSING AUTHORITY
STATUS OF COMPLIANCE TO MC NO. _____
REGION _________
AS OF _________

NO. OF EMPLOYEES WITH NO. OF EMPLOYEES WITH SIGNED

DISTRICT OFFICE
ACCOUNTS/AWARDS AUTHORITY TO DEDUCT (ATD)
LIST OF PROJECTS

Prepared By: Reviewed By: Certified Correct:

6.3 All Regional Offices shall ensure monthly submission of
their respective BCS back-up, Cash Receipts Register (CRR),
Cash Receipts and Deposits Register (CRDR), Journal Entry
Voucher (JEV) and Remittance List to Accounting
Department for proper monitoring of NHA permanent
employees’ accounts.

6.4 All delinquent accounts shall be coordinated with the

concerned Regional Office for proper intervention and
guidance
VII. SANCTIONS
7.1 NHA permanent employees who failed to pay three (3) monthly
installments shall be subject to the provisions of the Conditional
Contract to Sell (CCS) signed by the beneficiary as herein stated.
“Failure to pay three (3) monthly installments as well as any violation
and/or failure to comply with any of the terms and conditions stipulated
herein and any misrepresentation committed in the application
documents shall cause the cancellation of this contract, after failure of
the VENDEE to comply with the legal requirements on the demand
notices issued by the VENDOR, without necessity of a judicial
declaration to that effect. Thereafter, the VENDEE shall be considered
a mere illegal occupant and shall be evicted summarily pursuant to
Section 2 of Presidential Decree 1472 dated June 11, 1978”

7.2 Regional Managers, including responsible staff for payroll

processing, who fail to ensure compliance of concerned NHA
permanent employees with the ATD on the prescribed timelines,
shall be held administratively liable pursuant to 2017 Rules on
Administrative Cases in the Civil Service (2017 RACCS).
VIII. REPEALING CLAUSE
All provisions in Memorandum Circular No. 2317, 2506, 2018-
003, 2219 and 2219-A and other circulars not consistent with this
MC are hereby superseded. All other provisions shall remain valid and
in effect.

IX. EFFECTIVITY
This Circular shall take effect upon publication with the Office
of the National Administrative Register (ONAR) and compliance
with the period provided for by law.
 
These guidelines shall not preclude those NHA permanent
employees who voluntarily opt to have their amortization deducted
from their monthly salary prior to approval of this MC.

All concerned shall be guided accordingly.

Timeline of Implementation of Salary
Deduction Scheme
Timeline Activity
January 19 Orientation on Salary Deduction Scheme
January 20 – February 20 Execution of Authority to Deduct (ATD)
February 20 Deadline of Execution of ATD
February 21 – March 3 Forwarding of List of NHA Permanent Employees
to concerned units for Salary Deduction
March 15 All NHA Permanent Employees with
Award/Account should have their monthly
amortization deducted in their salary
THANK YOU!!!

End of Presentation