Philippines

FITA helps you find
service providers for:

Business Environment

General information: Guide to doing business
Canada's International Contracting Agency
Foreign Affairs and International Trade Canada
Opening hours and days: Banks: from 9 am to 5 pm.
Public Administrations: from 8 am to 5 pm Monday to Friday.
Shops: 10 am to 7 pm Monday to Sunday.

Holiday compensation: If a public holiday falls on a Wednesday, it is celebrated on the Monday. If it falls on a Sunday, it is celebrated on the following Monday.

Semana Santa	A week during the Holy Week period
Christmas	A few days

Tax year: The fiscal year begins on 1 January and ends on 31 December of the same year.
Accounting standards: PAS (Philippine Accounting Standards)
Accounting regulation bodies: Board of Accountancy
Accounting reports: The general balance sheet and/or the declaration written under oath of the non holding of an annual meeting, and the financial statements.
Publication requirements: Companies must publish an annual financial report and submit it to the Securities and Exchange Commission (SEC).
Professional accountancy bodies: PICPA
Certification and auditing: The accounting framework was established by the ASC, created by the PICPA in November 1981, in order to establish and improve the general and analytical accounting standards.
Accounting news: E-Accounting Times
Accounting Times
Accountants Journal

Nature of the tax: VAT (Value Added Tax)
Tax rate: 12%
Reduced tax rate: Zero-rate for exports and several items.
Other consumption taxes: In addition to real estate taxes, local governments impose tax on nearly all businesses operating within their jurisdictions. Rates vary but are usually a small percentage of gross annual sales. Excise taxes are levied on wines and spirits, beer, cigarettes and tobacco products, lubricating oils and grease (including similar preparations and additives), processed gas, waxes, denatured alcohol, cinematographic films, saccharine, coal and coke, cars, non-essential goods (jewellery, yachts and other pleasure vessels), mineral products, naphtha and other similar products of distillation, asphalt, and petroleum and other fuel products.

Company tax: The rate is 30% on net income but there are some preferential rates and exemptions. Preferential rates vary from 2 to 20%.
Tax rate for foreign companies: VAT is applied in the same way to residents and non residents.
Capital gains taxation: In the Philippines, capital gains are taxed between 5% and 10% (for unlisted companies securities). Besides, capital gains on property, as for private individuals, is taxed at 6%.
Main allowable deductions and tax credit: The Omnibus Investment Code of 1987 and the Special Economic Zone Act of 1995 provide for fiscal incentives such as a suspension of income tax.
Other corporate taxes: Tax of 3 to 7% on companies in certain sectors (banking, insurance, finance, transport).

Income Tax	Rates vary between 0 and 34% according to the income of natural persons.
From PHP 0 to 10,000	5%
From PHP 10,000 to 30,000	10%
From PHP 30,000 to 70,000	15%
From PHP 70,000 to 140,000	20%
From PHP 140,000 to 250,000	25%
From PHP 250,000 to 500,000	30%
Over PHP 500,000	34%
Tax on capital income	6% (real estate); 5% up to 100 000 PHP then 10% (earnings from shares not exchanged on the Stock Exchange); 1% of the sale price (earnings from shares exchanged on the Stock Exchange).
Property Tax	Varies according to the location, less than 3%
Tax on inheritance and property	Between 5 and 20%
Social contributions	Vary from 33.30 to 500 PHP, according to the salary

Allowable deductions and tax credit: Taxpayers benefit in the Philippines from various deductions according to their status (marriage, child).
Special expatriate tax regime: There is no special tax regime for expatriates. Non resident foreigners not involved in business are taxed at a preferential rate of 25% of their Philippine income.

Countries with whom a double taxation treaty have been signed: See the list of agreements for double taxation avoidance signed by the Philippines
Whithholding taxes: Dividends: 15%, Interest: 20%, Royalties: 20%

National organizations: The organisation responsible for the protection of intellectual property in the Philippines is the Intellectual Property Office of the Philippines.
Regional organizations: Harmonization within the ASEAN and the APEC

Type of property and law	Validity	International agreements signed
Patent Rules and Regulations on Inventions	20 years
Trademark Law on Trademarks, Service Marks and Trade Names	10 years, renewable every 10 years	Nice agreement
Copyright	During the lifetime of the author and 50 years after his death
Industrial Models	5 years, renewable twice

Independence of justice: The judiciary in the Philippines, though generally independent, is hampered by corruption and inefficiency.
Equal treatment of nationals and foreigners: To a large extent, foreign nationals can expect an impartial trial from the country’s judicial system.
The language of justice: The Philippines have two judicial languages: Filipino and English.
Sources of the law and legal similarities: The main source of the law is the constitution of 1987. The country’s legal system is based on Spanish and Anglo-American law. The Philippines accept compulsory ICJ jurisdiction though with reservations.
Checking national laws online: Philippine Laws and Jurisprudence Databank

National standards organizations: Bureau of Product Standards
Integration in the international standards network: The Philippines are members of the International Organization for Standardization (ISO), the International Electrotechnical Commission (IEC), the Asia Pacific Economic Cooperation (APEC), the ASEAN Consultative Committee on Standards and Quality (ACCSQ).
Classification of standards: PNS (Philippine National Standard) is the mark of the national standard.
Online consultation of standards: A list can be consulted on the Philippines National Standards Catalog on the Bureau of Product Standards website.
Certification organizations

Any comments about this content? Report it to us.