Source-cited draft: company formation & entity choice for Philippines (tax year 2025) — rates, thresholds and rules with primary-source citations. Unverified; pending local-accountant review.
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Every figure is drawn from this Tax Guide and cited to its source.
Common entity types
Domestic stock corporation, One Person Corporation (OPC), partnership, sole proprietorship, and branch/representative office of a foreign companyRevised Corporation Code of the Philippines (RA 11232)
Registration authority
Securities and Exchange Commission (SEC) for corporations/partnerships; DTI for sole proprietorshipsRevised Corporation Code of the Philippines (RA 11232)View source ↗
Minimum incorporators
1 (One Person Corporation); 2 to 15 for an ordinary stock corporationRevised Corporation Code of the Philippines (RA 11232)
Minimum paid-up capital (domestic, Filipino-owned)
No statutory minimum capital. **The 25%/25% rule is CONTESTED — do not assert it as current law.** The Revised Corporation Code (RA 11232 s.12) removed the statutory minimum and appears to have deleted the mandatory '25% of authorised capital subscribed / 25% of subscribed paid up' requirement for ORIGINAL incorporation (retaining it only for later increases in authorised capital). However, multiple 2025-dated practitioner and SEC-facing guides still describe SEC registration practice as requiring 25%/25% (with a practical floor around PHP 5,000). These do not reconcile from public sources: confirm against current SEC eSPARC/OneSEC practice before relying on either position.RA 11232 s.12 vs current SEC practice guides — unresolved. Flagged by Jonathan I. Ruiz (CPA).
Minimum capital for foreign-owned domestic corporation
USD 200,000 paid-up capital. Reduced to USD 100,000 if ANY of: (a) the enterprise involves advanced technology as determined by DOST; (b) it is endorsed as a startup or startup enabler under the Innovative Startup Act (RA 11337); or (c) a majority of its direct employees are Filipino, with an absolute floor of at least 15 Filipino employees. (RA 11647, in force 17 March 2022 — this REPLACED the old '50 direct employees' test.)RA 11647 (2022 amendment to the Foreign Investments Act) and its IRR. Corrected by Jonathan I. Ruiz (CPA, Philippines)
One Person Corporation minimum capital
No minimum paid-up capital required (unless mandated by the industry); name must end in 'OPC'Revised Corporation Code of the Philippines (RA 11232), Title XIII
Core incorporation steps
Reserve name and file Articles of Incorporation via SEC eSPARC; register with the BIR for TIN and books; register with the LGU for a business permit (Mayor's Permit); register as employer with SSS, PhilHealth and Pag-IBIGRevised Corporation Code (RA 11232); NIRC Section 236
SEC registration fee
1/5 of 1% of authorised capital stock (or the subscription price, whichever is higher), but NOT LESS THAN PHP 2,000 — per the SEC's own Registration Calculator. Plus a Legal Research Fee of 1% of the filing fee, itself not less than PHP 10.SEC Registration Calculator (sec.gov.ph). Corrected by Jonathan I. Ruiz (CPA, Philippines)
Typical incorporation timeline
Approximately 2 to 6 weeks to complete SEC, BIR, LGU and statutory-fund registrations ((approx — varies by LGU and completeness of documents))SEC / BIR registration procedures
Annual SEC compliance
File the General Information Sheet (GIS) within 30 days of the annual stockholders' meeting and Audited Financial Statements (AFS) per SEC scheduleRevised Corporation Code of the Philippines (RA 11232)
Annual BIR compliance
File the annual income tax return (BIR Form 1702) with audited financial statements; renew BIR registration and pay the documentary stamp tax; renew the LGU business permit each JanuaryNIRC Sections 52, 232; Local Government Code (RA 7160)
Statutory audit requirement
Independent audit and AFS required where gross annual sales/receipts exceed PHP 3,000,000NIRC Section 232; SEC rules
Rendered from the canonical facts model · method attested Jul 13, 2026 (covers the method, not the currency of individual figures). General reference only — confirm with a qualified professional before acting.
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Review status
Accountant-reviewed
Reviewed by a named licensed practitioner against the stated sources, as general reference material.
Accountant-reviewed
Reviewed by Jonathan I. Ruiz CPA · 13 July 2026
Applicable period: 2025
A named accountant reviewed this complete Guide version within the stated scope. It is not a guarantee.
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