Company Registration in the Philippines

The Philippines is a fast-growing economy in Southeast Asia with a pro-business environment, a highly skilled English-speaking workforce, and strategic access to regional markets. Its robust legal system, expanding digital infrastructure, and investor-friendly government policies make it an attractive destination for both local entrepreneurs and foreign investors.

Whether you're starting a small business, a representative office, or a fully foreign-owned enterprise, registering your company in the Philippines is the first crucial step to unlocking growth in one of Asia’s most dynamic markets.

This guide outlines everything you need to know about company registration in the Philippines — including types of business entities, legal requirements, tax structures, and how YKG GLOBAL can help simplify the process for you.

Types of Business Entities for Company Registration in the Philippines

When registering a business in the Philippines, investors can choose from various legal structures depending on their goals, ownership structure, and business activities. Below are the main types of business entities:

1. Domestic Corporation

• Most common entity for local and foreign-owned businesses.

• Requires at least 2 incorporators and a minimum of 5 directors.

• Foreigners can own up to 100%, depending on the business activity and the Foreign Investment Negative List.

• Requires minimum capital of PHP 5,000, though higher capital may apply based on ownership and activity.

2. One Person Corporation (OPC)

• A newer entity type allowing a single person (Filipino or foreigner) to form a corporation.

• Offers limited liability without the need for partners or co-founders.

• Ideal for solo entrepreneurs, consultants, or freelancers looking to formalize their operations.

3. Representative Office

• Established by a foreign parent company.

• Cannot earn income in the Philippines; used for liaison, market research, or promotion.

• Must remit at least USD 30,000 annually to cover operating expenses.

4. Branch Office

• A foreign company can set up a branch to do business and earn revenue in the Philippines.

• Subject to local taxes and required to remit a capital of USD 200,000 (may be reduced to USD 100,000 under certain conditions like advanced technology or employing 50+ Filipinos).

5. Regional Headquarters (RHQ) / Regional Operating Headquarters (ROHQ)

• RHQs serve as administrative branches and cannot earn income.

• ROHQs can provide qualifying services to affiliates and are allowed to earn income within the group.

6. Sole Proprietorship

• Owned by a single individual (must be a Filipino citizen).

• Easy to set up but offers no liability protection.

Eligibility Criteria for Company Registration in the Philippines

Before registering a business in the Philippines, investors must meet certain eligibility conditions based on the type of entity, business activity, and ownership structure. Here's what you need to know:

 1. Nationality and Ownership Restrictions

• 100% Foreign Ownership is allowed in many sectors, especially export-oriented businesses.

• Some industries are restricted or limited to Filipino citizens under the Foreign Investment Negative List (e.g., retail trade, land ownership, mass media).

• Mixed ownership (e.g., 60% Filipino, 40% foreign) may be required in restricted sectors.

 2. Minimum Capital Requirements

• Domestic Corporation (foreign-owned): USD 200,000 minimum paid-up capital.

  • This can be reduced to USD 100,000 if the business:

    • Uses advanced technology, or

    • Employs at least 50 Filipino employees.

• Export Enterprises: May require only PHP 5,000 paid-up capital if at least 60% of revenues come from exports.

 3. Resident Agent or Local Representative

• A resident agent (Filipino citizen or Philippine resident) is required for foreign corporations, branch offices, and representative offices.

 4. Incorporators and Directors

• A Domestic Corporation requires:

  • Minimum of 2 incorporators (can be individuals or corporations).

  • At least 5 directors/trustees, majority of whom must be residents of the Philippines.

 5. Business Address in the Philippines

• A local office address is mandatory to register a company and receive official communications.

 6. Age and Legal Capacity

• Incorporators and directors must be at least 18 years old, mentally competent, and not disqualified by law.

Procedure for Company Registration in the Philippines

Setting up a company in the Philippines involves several legal and administrative steps. Here’s a detailed breakdown of the registration process:

Step 1: Choose a Business Structure

• Decide whether you want to register as a Domestic Corporation, One Person Corporation, Branch Office, etc.

Step 2: Reserve Company Name with SEC

• Submit your proposed company name via the Securities and Exchange Commission (SEC) online portal.

• Wait for name approval before proceeding.

Step 3: Prepare Incorporation Documents

• Draft and notarize the following documents:

  • Articles of Incorporation

  • By-laws

  • Treasurer’s Affidavit

  • Incorporators’ IDs and Taxpayer Identification Numbers (TIN)

  • Proof of inward remittance (for foreign capital)

  • Lease contract or business address proof

Step 4: Register with the SEC

• Submit incorporation documents to the SEC through the Company Registration System (CRS).

• Upon approval, the SEC will issue the Certificate of Incorporation.

Step 5: Obtain a Barangay Clearance

• Apply for clearance from the Barangay (local administrative unit) where your office is located.

Step 6: Register with the Local Government Unit (LGU)

• Secure a Mayor’s Permit or Business Permit from the City or Municipality Office.

Step 7: Register with the Bureau of Internal Revenue (BIR)

• Register your business with the BIR to:

  • Get your TIN (Taxpayer Identification Number)

  • Print official receipts/invoices

  • Register books of accounts

Step 8: Register with Other Agencies (if applicable)

• SSS (Social Security System) – for employee benefits

• PhilHealth – for health insurance

• PAG-IBIG Fund – for employee housing benefits

Various Taxes Applicable to Registered Companies in the Philippines

Registered companies in the Philippines are subject to several national and local taxes. Understanding the tax framework helps ensure compliance and efficient financial planning.

 1. Corporate Income Tax (CIT)

• Domestic Corporations:

  • 25% of net taxable income (if gross income > PHP 5 million).

  • 20% for small corporations (with net taxable income ≤ PHP 5 million and total assets ≤ PHP 100 million).

• Resident Foreign Corporations:

  • Also taxed at 25% on income earned in the Philippines.

• Non-resident Foreign Corporations:

  • Taxed at 25% on gross income sourced from the Philippines.

 2. Value-Added Tax (VAT)

• Standard VAT rate: 12%

• Applies to the sale of goods, services, and imports.

• Businesses with annual gross sales exceeding PHP 3 million must register as VAT taxpayers.

 3. Percentage Tax (Non-VAT)

• Applicable to non-VAT registered businesses.

• Standard rate: 3% of gross quarterly sales/receipts.

• Optional for businesses with revenue below PHP 3 million.

 4. Withholding Tax

• Companies must withhold and remit tax on certain transactions:

  • Compensation: Based on employee income brackets.

  • Rent, commissions, professional fees: Typically 1–10% depending on the type of payment and recipient.

 5. Local Business Tax (LBT)

• Imposed by the Local Government Unit (LGU) where the business is located.

• Rate varies based on nature of business and location.

 6. Documentary Stamp Tax (DST)

• Imposed on certain documents like loan agreements, share issuances, and leases.

 7. Other Applicable Taxes and Fees

• Customs Duties (on imported goods)

• Excise Tax (on alcohol, tobacco, fuel, etc.)

• Real Property Tax (RPT) – if the company owns land/buildings

Documents Required for Company Registration in the Philippines

To successfully register a company in the Philippines, the following documents are typically required. These may vary slightly depending on the type of business entity being registered.

 1. Articles of Incorporation and By-Laws

• Foundational documents that outline the company’s name, purpose, capital structure, and internal rules.

• Must be signed by incorporators and notarized.

 2. Name Reservation Certificate

• Proof that the company name has been approved and reserved via the SEC Company Registration System (CRS).

 3. Incorporators’ and Directors’ Identification

• Government-issued IDs with signature (e.g., passport, driver’s license).

• Foreign incorporators/directors must provide passport copies and additional documentation (e.g., apostilled documents, consularized forms if applicable).

 4. Treasurer’s Affidavit

• A sworn statement from the elected treasurer-in-trust that the capital has been subscribed and paid.

 5. Proof of Registered Business Address

• Lease contract or title deed.

• Barangay clearance or utility bill may also be requested.

 6. Capitalization Document

• Proof of inward remittance for foreign capital (bank certificate or affidavit of remittance).

 7. Board Resolution (for Corporations acting as Incorporators)

• Required if a corporate entity is participating as one of the incorporators.

 8. Mayor’s Permit and Barangay Clearance

• Needed after SEC registration to operate legally at the local level.

 9. BIR Forms and Requirements

• BIR Form 1903 (application for TIN)

• Payment of registration fee

• Books of account and printer’s accreditation for official receipts

Benefits of Company Registration in the Philippines

Registering your company in the Philippines opens the door to a wide range of economic, operational, and strategic advantages. Here are the key benefits:

 1. Access to a Fast-Growing Economy

The Philippines is one of Southeast Asia’s emerging markets, with consistent GDP growth, strong consumer demand, and increasing foreign direct investment (FDI).

 2. Strategic Location in Asia-Pacific

Located at the crossroads of major trade routes, the Philippines offers easy access to key markets in Asia, the Middle East, and Oceania—making it an ideal hub for regional operations.

 3. Business-Friendly Legal Framework

The Philippine government has simplified registration processes and offers tax incentives to investors under programs like the Board of Investments (BOI) and Philippine Economic Zone Authority (PEZA).

 4. Skilled, English-Speaking Workforce

The country boasts a highly educated, English-speaking labor pool, ideal for sectors like BPO, IT, manufacturing, and customer service.

 5. 100% Foreign Ownership Allowed

In many industries, especially export-oriented businesses, foreign investors can fully own and control their company, subject to compliance with foreign investment laws.

 6. Legal Identity and Limited Liability

A registered corporation or OPC provides legal separation between the business and its owners, protecting personal assets from business liabilities.

 7. Eligibility for Government Incentives

Registered companies can apply for tax holidays, customs duty exemptions, and other incentives under investment promotion agencies.

 8. Improved Credibility and Investor Confidence

Registration enhances trust among customers, partners, and investors—positioning your business for long-term success.

Why Choose YKG GLOBAL for Company Registration in the Philippines?

At YKG GLOBAL, we specialize in making your business entry into the Philippines smooth, compliant, and cost-effective. Here’s why countless entrepreneurs and global companies trust us:

 Global Standards, Local Expertise

We combine international business practices with deep understanding of Philippine laws, ensuring your company is registered correctly and efficiently.

 End-to-End Registration Support

From securing name approval to filing documents with the SEC, obtaining local permits, and tax registration—we manage the entire process for you.

 Time-Saving & Hassle-Free

We streamline every step to save your time and minimize bureaucratic delays. Our team handles paperwork, follows up with agencies, and ensures fast turnaround.

 Compliance & Advisory Services

Our experts don’t stop at registration—we provide ongoing compliance, accounting, tax, and regulatory advisory to keep your business running smoothly.

 Specialists in Foreign-Owned Company Setup

We help foreign investors navigate capital requirements, ownership restrictions, and immigration needs (like visas for directors or investors).

 Trusted by 5000+ Global Clients

With over four decades of experience, YKG GLOBAL has successfully set up companies in 20+ countries, including the Philippines. Your success is our mission.

 Transparent Pricing & Dedicated Support

No hidden fees, no confusion—just clear, honest advice and a dedicated manager to guide you at every step.