Philippines company formation for non-residents

Why businesses set up in the Philippines

The Philippines has a large English-speaking workforce and a mature business process outsourcing (BPO) sector. Many foreign companies set up here to employ customer support, finance and IT teams.

Export-oriented service companies get the most flexibility, because the domestic capital floor does not apply to them. Businesses selling into the local market face more rules on capital and ownership.

Many BPO and export companies apply to an investment promotion agency, such as the Philippine Economic Zone Authority (PEZA) or the Board of Investments (BOI). Registered projects can receive tax incentives under the CREATE framework, as amended by the CREATE MORE Act of 2024.

Incentives come with conditions on location, exports and reporting, and the rules differ by agency. Decide whether you will apply before you choose the office, because location can affect eligibility (confirm with your specialist).

Companies that sell mainly to Philippine consumers face the most rules, including higher capital floors and some reserved activities. Check where your revenue will come from before choosing the structure.

Foreign ownership: Negative List and capital

The Foreign Investments Act allows up to 100% foreign ownership unless the activity appears on the Regular Foreign Investment Negative List. The 13th list, Executive Order 113 of 2026, took effect in May 2026 and replaced the 12th list from 2022.

List A covers limits set by the Constitution and specific laws, such as land ownership and mass media. List B covers limits for security, health and the protection of small businesses.

Capital is the second test. A domestic-market enterprise more than 40% foreign-owned generally needs paid-in capital of at least US$200,000. Republic Act 11647 lowered this to US$100,000 for advanced technology, endorsed startups, or companies with at least 15 direct employees, a majority Filipino. Export enterprises, selling at least 60% of output abroad, are not subject to this floor.

Some activities have their own rules. Retail trade enterprises with foreign equity, for example, need paid-up capital of at least PHP 25,000,000 under the Retail Trade Liberalization Act (confirm with your specialist).

Directors, officers and the one person option

The Revised Corporation Code of 2019 allows up to 15 incorporators. A single owner forms a One Person Corporation, and foreigners can do this subject to the same capital rules.

Residence rules apply to the people running the company, not the owners.

A foreign-owned company also proves its paid-in capital to the SEC, usually with a bank certificate of deposit for the inward remittance.

• Board of up to 15 directors; a majority must be Philippine residents
• President must be a director
• Corporate secretary: Filipino citizen and resident
• Treasurer: Philippine resident
• Each director holds at least one share

How registration works

We check the Negative List and the capital your activity needs. You pass KYC, then we verify and reserve the name through the SEC online system.

For a foreign-owned company, the paid-in capital is remitted to a Philippine bank and certified. We file the articles of incorporation, by-laws and supporting documents, and the SEC issues the certificate of incorporation.

Next come the barangay clearance and mayor's permit from the local government, then BIR registration. The BIR issues the certificate of registration and registers the books of account and invoicing. The standard process takes 3–6 weeks after KYC approval.

The most frequent problem is the resident officers. Founders plan the ownership and forget that the board majority, the corporate secretary and the treasurer must meet residence or citizenship rules. Line these people up before filing.

The second is documents signed abroad without notarisation and apostille, which the SEC may reject. The third is missing the General Information Sheet deadline after the annual meeting, which leads to penalties.

Tax, audit and annual filings

The regular corporate income tax rate is 25% under the CREATE Act. A corporation with net taxable income up to PHP 5,000,000 and total assets up to PHP 100,000,000, excluding land, pays 20%. VAT is 12% for VAT-registered businesses.

The SEC requires audited financial statements once total assets or liabilities reach PHP 600,000. Each year the company files a General Information Sheet within 30 days of its annual meeting, the audited statements and the BIR annual return.

The company also files monthly and quarterly BIR returns, withholds tax on salaries and many payments, and renews the mayor's permit each January.

Dividends paid to a foreign parent company are subject to final withholding tax, which a tax treaty may reduce (confirm with your specialist). Transactions with related companies abroad must be priced at arm's length.

Hiring staff and employer registrations

A company that hires staff registers as an employer with three agencies: the Social Security System (SSS), PhilHealth for health insurance and the Pag-IBIG Fund for housing savings. Contributions are shared between employer and employee and are paid monthly.

The company also withholds income tax from salaries and files withholding returns with the BIR. Labour rules, including the 13th-month pay, come from the Labor Code and apply from the first employee.

Foreign staff need an Alien Employment Permit from the Department of Labor and Employment and a work visa. Plan these before a foreign manager moves to the Philippines.

What OCC handles and what it costs

Our Philippine package starts at a fixed quote for year 1 with SEC and standard registration fees included, and a fixed quote from year 2. It covers the ownership check, SEC registration, local permits and BIR registration.

Resident directors and officers, bookkeeping and the annual audit are quoted separately. OCC is licensed in Hong Kong as a trust or company service provider (TCSP TC001305) and works with Philippine professionals where local law requires them. Banks decide on accounts; we introduce you and prepare the application.