Philippines

Company Formation in Philippines

Q: Can a foreigner own 100% of a company in the Philippines?

Yes. Foreigners can own 100% of an export-oriented enterprise (deriving at least 60% of revenue from abroad) with as little as PHP 5,000 capital. For domestic market enterprises (selling within the Philippines), 100% foreign ownership requires a paid-up capital of USD 200,000 (reduced to USD 100,000 for advanced tech or employing 50+ direct workers).

Q: What are the benefits of PEZA registration?

The Philippine Economic Zone Authority (PEZA) provides registered export service and manufacturing enterprises with generous incentives: 4–7 years Income Tax Holiday (ITH), followed by a 5% Special Corporate Income Tax on gross income in lieu of all national and local taxes, duty-free importation of capital equipment, and 0% VAT on local purchases.

Q: Can a foreigner set up a One Person Corporation (OPC)?

Yes, a natural foreign person can register an OPC in the Philippines, subject to the same foreign investment capital thresholds and negative list rules that govern standard corporations.

Philippines

Formation Time

3–6 weeks

Min. Capital

PHP 5,000 (domestic market: USD 200,000 for foreign)

Corporate Tax

20% (SME) / 25% (regular)

Foreign Ownership

100%

Overview

The Philippines is a high-growth Southeast Asian economy renowned as a premier global hub for Business Process Outsourcing (BPO), customer experience, IT services, and software engineering. Under the revised Corporation Code and the Foreign Investment Act amendments, foreign investors can establish a One Person Corporation (OPC) or a standard Domestic Corporation with 100% foreign equity for export-oriented enterprises (earning at least 60% of revenue overseas). The CREATE Act lowered standard corporate income tax to 25% (20% for micro/SMEs), while PEZA and BOI-registered export enterprises enjoy special corporate tax incentives of 5% gross income tax (GIT) or special corporate income tax (SCIT) in lieu of all national and local taxes, alongside duty-free imports and income tax holidays.

Global BPO & tech hub

English-speaking workforce

PEZA 5% tax incentives

OPC single founder option

43 tax treaties

Why Choose Philippines

Global leader in Business Process Outsourcing (BPO) and IT services

World's #3 English-speaking nation with highly skilled university talent

100% foreign ownership allowed for export enterprises and OPCs

PEZA & BOI incentives: 5% Gross Income Tax (GIT) or tax holidays up to 7 years

One Person Corporation (OPC) allows single-shareholder foreign setup

Large domestic consumer market of 115+ million people

Reformed Foreign Investments Act opening retail, telecommunications, and startups

43 double taxation avoidance treaties

Business Entity Types

Entity	Ownership	Directors	Capital	Tax	Best For
Domestic Corporation	100% (for export enterprises); up to 40% (domestic market without USD 200K capital)	1 to 15 directors (majority should be Philippine residents)	PHP 5,000 (export); USD 200,000 (domestic market non-export)	20% (SMEs) / 25% regular; 5% GIT for PEZA export companies	BPO centres, IT outsourcing, shared services, export trading
One Person Corporation (OPC)	100% (natural person or trust)	1 sole director (the single stockholder)	No general min (subject to foreign equity rules)	25% corporate tax rate	Solo founders, holding assets, dedicated consulting practices
Branch Office	100%	1 resident agent in the Philippines	USD 200,000 remitted capital (USD 100K with advanced tech or 50+ staff)	25% on Philippine-sourced net taxable income; 15% branch profit remittance	Foreign corporate entities operating direct business operations in PH
Regional Operating Headquarters (ROHQ)	100%	1 resident agent	USD 200,000 initial inward remittance	25% regular CIT (qualifying service branch)	Multinational shared service centres and regional management

Step-by-Step Formation Process

SEC Registration

1–2 weeks

Reserve name and lodge incorporation via SEC Electronic Simplified Processing of Application for Company Registration (eSPARC).

Bank Account & Capital Remittance

1–2 weeks

Open temporary treasury in-trust account and convert foreign capital to Philippine Pesos.

Barangay & Mayor's Business Permit

1–2 weeks

Secure community clearance and Mayor's Business Permit from local City Hall.

BIR Tax Registration

1–2 weeks

Register with Bureau of Internal Revenue (BIR) for Taxpayer Identification Number (TIN), books of accounts, and official invoices.

Statutory Employer Registration

1 week

Costs & Fees

Government / License Fee	PHP 5,000+
Our Service Fee	USD 3,000+
Annual Renewal	USD 1,800+

Fees are indicative and may vary based on business activity, entity type, and additional approvals required. Contact us for a precise custom quote.

Get Custom Quote

Banking

The Philippine banking system is anchored by major commercial banks like BDO Unibank, Bank of the Philippine Islands (BPI), and Metrobank. International banks (Citibank, HSBC) maintain substantial corporate presence. In-person verification is typically required for opening local operational accounts.

Account Opening Time

2–4 weeks

Multi-Currency

Yes — multiple currencies supported

Recommended Banks

BDO UnibankBank of the Philippine Islands (BPI)MetrobankSecurity BankUnionBank of the PhilippinesHSBC Philippines

Tax Overview

Corporate Tax

25% regular rate; 20% for domestic enterprises with net taxable income <PHP 5M and assets <PHP 100M

Personal Income Tax

0% to 35% progressive; first PHP 250,000 exempt

VAT / Sales Tax

12% standard VAT; 0% zero-rated for PEZA export registered enterprises

Capital Gains Tax

15% on net capital gains from unlisted stock sales; 6% on real property

Withholding Tax

25% on dividends to non-resident foreign corporations (reduced to 15% via tax-sparing or treaty)

Double Tax Treaties

43 countries

PEZA / BOI registered export enterprises can access Special Corporate Income Tax (SCIT) of 5% on gross income or 4–7 years Income Tax Holiday (ITH).

Visa & Residency

9(d) / 9(g) Commercial Work Visa

1 to 3 years, renewable

Pre-arranged employment visa for foreign officers and skilled staff

Special Investor's Resident Visa (SIRV)

Indefinite (as long as investment is maintained)

Requires USD 75,000 investment in Philippine business or listed shares

PEZA Visa (47(a)(2))

1 to 2 years, renewable

Fast-tracked visa for foreign personnel of PEZA-registered ecozone enterprises

Family visa: AvailableProcessing: 4–8 weeks

Frequently Asked Questions

Can a foreigner own 100% of a company in the Philippines?

Yes. Foreigners can own 100% of an export-oriented enterprise (deriving at least 60% of revenue from abroad) with as little as PHP 5,000 capital. For domestic market enterprises (selling within the Philippines), 100% foreign ownership requires a paid-up capital of USD 200,000 (reduced to USD 100,000 for advanced tech or employing 50+ direct workers).

What are the benefits of PEZA registration?

The Philippine Economic Zone Authority (PEZA) provides registered export service and manufacturing enterprises with generous incentives: 4–7 years Income Tax Holiday (ITH), followed by a 5% Special Corporate Income Tax on gross income in lieu of all national and local taxes, duty-free importation of capital equipment, and 0% VAT on local purchases.

Can a foreigner set up a One Person Corporation (OPC)?

Yes, a natural foreign person can register an OPC in the Philippines, subject to the same foreign investment capital thresholds and negative list rules that govern standard corporations.