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Philippines Tax Guide

Asia
Updated January 2025
Sources + last updated

This page includes citations to the sources used for this entry. Always verify with official sources before making decisions.

Personal Tax Score
70/100
Tax Friendly
Business Tax Score
72/100
Tax Friendly

Personal Income Tax

Tax Residency

Day Threshold
180 days
Note
180 days establishes residency

Income Tax Rates

Top Marginal Rate
35%
Structure
Progressive 0-35%

Foreign Income Treatment

System
Territorial
Details
Non-resident citizens taxed on Philippine-source income only

Investment Income

Capital Gains
0-15%%
Dividends
10%
Interest
20%

15% on real estate; exempt on securities under conditions


Wealth & Inheritance

Wealth Tax
No - No wealth tax
Inheritance Tax
No - Estate tax up to 6% on net estate

Special Regimes

Special Investor Resident Visa
Residency through investment

Practical Notes

English widely spoken. Growing economy. Various special economic zones.

Business & Corporate Tax

Corporate Income Tax

Headline Rate
25%
Effective Rate Note
25% corporate tax; lower for MSMEs
Free Zone / Incentives
PEZA and various economic zones offer incentives

Withholding Taxes

Dividends
0-15%%
Interest
0-20%%
Royalties
0-20%%

VAT / GST

Rate
12%
Note
12% VAT

Compliance & Substance

Substance Requirements
Moderate - PEZA requirements
Compliance Friction
Moderate

Notable Regimes

  • PEZA incentives
  • Various economic zones

Data Sources

Last updated: January 2025. Always verify with official sources before making decisions.

FAQ

What is the personal income tax rate in Philippines?

Philippines has a top personal income tax rate of 35%. The tax structure is: Progressive 0-35%. See the detailed breakdown above and verify with official sources.

Do I need to pay tax on foreign income in Philippines?

Philippines uses a territorial system for foreign income. Non-resident citizens taxed on Philippine-source income only

What are the residency requirements for Philippines?

Tax residency in Philippines generally requires 180 days of physical presence. 180 days establishes residency. Always verify current rules with official sources.

Is there a wealth tax in Philippines?

No, Philippines does not have a wealth tax. No wealth tax

What is the corporate tax rate in Philippines?

The corporate tax rate in Philippines is 25%. 25% corporate tax; lower for MSMEs