Paying Taxes in


Below is a detailed summary of the taxes and mandatory contributions that a medium-size company must pay or withhold in a given year, as well as administrative burden in paying taxes and complying with postfiling procedures.

This information was collected as part of the Doing Business project, which measures and compares regulations relevant to the life cycle of a small- to medium-sized domestic business in 190 economies. The most recent round of data collection was completed on June 1, 2016 covering for the Paying Taxes indicator calendar year 2015 (January 1, 2015 – December 31, 2015).

Compare Philippines to 189 other economies.

Tax or mandatory contribution Payments (number) Notes on Payments Time (hours) Statutory tax rate Tax base Total tax rate (% of profit) Notes on TTR
Local business tax 1 0.5% previous year turnover 8.84
Employer paid - Social security contributions 1 online 37 P 1,208.70 per employee per month gross salaries 6.72
Real property tax 1 2% assessed property value 4.44
Corporate income tax 1 online 39 30% taxable profit 20.26
Employer paid - Health insurance 4 online 1.16% to 1.19% gross salaries 1.24
Employer paid - Housing development fund 12 2% or P100 per worker gross salaries 0.56
Tax on interest 1 online 20% interest 0.51
Employer paid - Employer's compensation 0 jointly P 30 per employee per month 0.17
Environmental tax 1 P 10,000 fixed fee 0.08
Community tax certificate 1 P 10,500 fixed fee 0.08
Vehicle tax 1 basic fee + 24% vehicle weight 0.04
Tax on insurance contracts 1 online P 0.5 per each P 4 insurance premium 0.00 small amount
Stamp duty 1 online various rates contract value 0.00 small amount
BIR certificate 0 jointly P 500 fixed fee 0.00
Value added tax (VAT) 1 online 110 12% value added 0.00 not included
Tax on check transactions 1 online P 1.5 per check number of checks 0.00 small amount
Employee paid - Social security contributions 0 jointly 1.33% to 2.98% gross salaries 0.00 withheld
Employee paid - Payroll tax 0 jointly 1.16% to 1.19% per employee per month 0.00 withheld
Employee paid - Housing development fund 0 jointly 2% or P 100 per worker gross salaries 0.00 withheld
Totals: 28.0 185.6 42.9
Taxes by type Answer
Profit tax (% of profit) 20.3
Labor tax and contributions (% of profit) 8.7
Other taxes (% of profit) 13.9
Answer Score
Postfiling index (0-100) 49.8
VAT refunds
Does VAT/GST exist? Yes
Frequency of VAT/GST refund submission monthly
Does a VAT/GST refund process exist per the case study? No
Restrictions on VAT refund process Restricted to international traders and others
Likelihood of VAT audit N/A
Time to comply with VAT refund (hours) N/A 0.0
Time to obtain a VAT refund (weeks) N/A 0.0
Corporate income tax audits
Does corporate income tax exist? Yes
Likelihood of corporate income tax audit Unlikely
Time to comply with a corporate income tax audit (hours) 2.0 99.1
Time to complete a corporate income tax audit (weeks) 0.0 100.0
Administrative appeal process
First level administrative appeal authority Commissionar of internal revenue
Is the appeal authority independent? Independent department within tax office
Are appeal guidelines accessible to the public? Yes
Source of appeal guidelines Online/in printed publication/in person at tax office
Is there a legal time limit for the appeal authority to issue a decision on the tax appeal? No
Legal time limit


Name of taxes have been standardized. For instance income tax, profit tax, tax on company's income are all named corporate income tax in this table.

The hours for VAT include all the VAT and sales taxes applicable.

The hours for Social Security include all the hours for labor taxes and mandatory contributions in general.

The postfiling index is the average of the scores on time to comply with VAT refund, time to obtain a VAT refund, time to comply with a corporate income tax audit and time to complete a corporate income tax audit.

N/A = Not applicable.