Philippines (PH)
The Philippines is a Southeast Asian archipelago of 7,641 islands, the third-largest English-speaking country in the world, and one of the most welcoming destinations for expats.
Capital: Manila
Region: Asia
Language: Filipino
Currency: PHP (₱)
Cost of living: Very affordable (index 30)
Emergency: 911
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Business Setup
Start a business or go freelance in Philippines.
🧑💻 Freelancer / Self-Employed Guide
Steps to register:
- 1 1. Determine your structure: Most foreign freelancers working for non-Philippine clients remain on a tourist visa extension. Those billing Philippine clients or earning locally need an AEP and tax registration.
- 2 2. Register with BIR: Go to the Revenue District Office (RDO) covering your address. Fill out BIR Form 1901 (for self-employed individuals / mixed income). Bring passport, ACR I-Card, contract, and proof of address.
- 3 3. Receive your TIN (Tax Identification Number): Issued at the RDO on registration. Required for all invoicing and tax filings.
- 4 4. Register your books of accounts: BIR requires a manual journal or an electronic accounting system (eBIR-registered). Bring books to RDO for stamping.
- 5 5. Register official receipts (OR): Apply for Authority to Print (ATP) receipts at your RDO. Receipts must be issued to every client (Philippine or foreign) upon payment.
- 6 6. Pay quarterly percentage tax (Non-VAT): If gross receipts < ₱3,000,000/year, pay 3% quarterly percentage tax (BIR Form 2551Q). Alternatively, opt for 8% flat income tax in lieu of regular graduated rates and percentage tax (if total income ≤ ₱8M/year — very advantageous).
- 7 7. File annual ITR: BIR Form 1701A (for mixed income earners). Deadline: April 15. File via eBIRForms or eFPS portal.
- 8 8. Pay Barangay business permit and Mayor's Permit annually: Even home-based freelancers often need these LGU permits. Cost: ₱500–₱3,000 depending on LGU.
Tax registration
BIR (Bureau of Internal Revenue) — register at your Revenue District Office (RDO). Use BIR Form 1901 for sole proprietors/self-employed. Online registration available via myBIR portal for some transactions.
VAT threshold
₱3,000,000 annual gross sales/receipts. Below this: exempt from mandatory VAT registration (but may opt in). Non-VAT freelancers pay 3% quarterly percentage tax OR choose the 8% flat income tax option.
Invoicing
Official Receipts (OR) must be BIR-registered. Must include: your business/trade name, TIN, address, OR number, date, amount, and description of services. Non-VAT OR must bear "THIS DOCUMENT IS NOT VALID FOR CLAIM OF INPUT TAX" statement. Invoice must be issued within the transaction period.
Social security
Self-employed foreigners with AEP must contribute to SSS (voluntary for freelancers without AEP). PhilHealth voluntary membership available. Pag-IBIG voluntary contributions: ₱100–₱200/month. Self-employed are responsible for both employer and employee shares of contributions.
💡 The 8% income tax option (vs graduated rates + 3% percentage tax) is often more advantageous for freelancers earning ₱250,000–₱3,000,000/year — calculate before filing. Foreign freelancers working for overseas clients and earning foreign currency are only taxed on Philippines-sourced income if non-resident, but may be taxed as resident if staying 180+ days per year.
🏢 Business Structures
Sole Proprietorship · Sole Proprietorship
Sole Trader
None legally required (DTI registration: ₱200–₱2,000)
Min. capital
1–3 weeks
Setup time
Liability: Unlimited personal liability
Setup cost: ₱200–₱5,000 (DTI name registration + barangay + mayor's permit + BIR)
Best for: Small businesses, freelancers, consultants, solo service providers. Not available to foreigners (100% Filipino ownership required by default).
Partnership · General Partnership / Limited Partnership
Partnership
₱3,000 minimum for general partnership
Min. capital
2–4 weeks
Setup time
Liability: General partners: unlimited. Limited partners: limited to contribution
Setup cost: ₱5,000–₱20,000 (SEC registration + notarised articles)
Best for: Two or more partners. Foreigners may participate in limited partnerships. 60/40 rule applies for land-owning businesses.
Domestic Corporation (Stock) · Domestic Stock Corporation
Limited Liability Company / Corporation
No minimum (Revised Corporation Code 2019), except for foreign equity participation: $200,000 minimum if 60%+ foreign-owned (reduced to $100,000 if employing 50+ Filipinos or using advanced technology)
Min. capital
2–6 weeks (SEC eSPARC online system)
Setup time
Liability: Limited to subscribed capital stock
Setup cost: ₱10,000–₱50,000+ (SEC registration, Articles of Incorporation, bylaws, notarisation)
Best for: Most common structure for foreign businesses. Foreigners can own up to 40% (60/40 rule) in most industries, or up to 100% in industries on the Foreign Investment Negative List (FINL).
OPC (One Person Corporation) · One Person Corporation
Single-Member LLC
No minimum (per Revised Corporation Code)
Min. capital
1–3 weeks via SEC eSPARC
Setup time
Liability: Limited (shareholder liability limited to subscribed capital)
Setup cost: ₱5,000–₱15,000
Best for: Solo foreign entrepreneurs or local professionals. Introduced by the Revised Corporation Code 2019. Cannot be used for certain regulated industries.
ROHQ / RHQ · Regional Operating Headquarters / Regional Headquarters
Regional Hub
$200,000 per year (ROHQ) / $50,000 per year (RHQ)
Min. capital
3–6 months (SEC + PEZA/BOI registration for incentives)
Setup time
Liability: Parent company liability applies
Setup cost: $200,000–$500,000+ (capital infusion required)
Best for: Multinational companies using the Philippines as a regional hub for SE Asia operations. Enjoy preferential tax treatment under CREATE Law (transitional incentives).
PEZA / BOI Registered Entity · Philippine Economic Zone Authority / Board of Investments Registered Company
Special Economic Zone Company
Varies by project and industry
Min. capital
2–6 months
Setup time
Liability: Per underlying corporate structure
Setup cost: Standard corporate costs + PEZA/BOI registration fees
Best for: IT-BPM companies, exporters, manufacturers. Enjoy income tax holiday (ITH), 5% GIE (Gross Income Earned) tax under old regime, or RCIT under CREATE Law with incentives. 100% foreign ownership possible for PEZA export enterprises.
Business Setup
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