Foreign enterprisers interested instarting a businessin an Asian country usually on the legislation favoring foreign investments which grants varioustax exemptions, however the regulartaxation systemis also important. This is also the case of thePhilippineswhich has anattractive taxation systemdoubled by the types of companies which can be set up by overseas entrepreneurs.
Below, ourcompany formation consultants in the Philippineswill explain how thetaxation systemin this country works.
Ourimmigration lawyers in Philippinescan give you details about the taxation of foreign nationals.
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Legislation related to taxation in the Philippines
ThePhilippines taxation systemis made up ofdirect and indirect taxes. These are regulated by several laws, among which:
– the National Internal Revenue Code, which was enabled in 1997 and it is the most important law regulating taxation here;
– the Income Tax Law;
– the Value Added Tax Code;
– the Excise Taxes Code.
There are also other regulations providing for thetaxation of individuals and companies in the Philippines.
We also remind you that ourPhilippines company registrationspecialistscan help youregister a companyin this country.
If you are a foreign investor, we can also give you details aboutimmigration to Philippinesthrough investment.
What are the taxes to be paid in the Philippines?
As mentioned above there are two types oftaxes levied in the Philippines: the direct and indirect ones.
Direct taxesapply to the citizens and residents of thePhilippines, individuals andcompaniesand are levied directly on the incomes generated by them. These are the personal income and the corporate tax. With respect toindirect taxes, the value added tax (VAT) or the goods and services tax (GST) is the most important one.
It should be noted thatFilipino taxpayersare classified into:
– individuals;
– corporations;
– fiduciaries.
Ourlocal agentscan offer more information on this classification and ourimmigration lawyers in Philippineswill give you details about the tax rates for foreign individuals.
Tax rates in the Philippines
The followingtax rates apply to individuals andcompanies in the Philippines:
– the personal income tax, which is levied at rates between 5% and 32%;
– the corporate tax which is levied at a 30% rate;
– the VAT which has a standard rate of 12%.
It should be noted that thePhilippines offers various incentives for foreign investors, among themtax exemptions and deductions.
If you want toopen a company in the Philippinesand need information on thetaxesyou will pay, pleasecontact our local company registration consultants.
You can also reach out to us if you have questions aboutimmigration to Philippines.
