Information${name}

  • Home
  • Information${name}

Navigating the Philippines: A Guide to Key Tax and Compliance Deadlines for Foreign Businesses

For foreign-owned corporations and entities, compliance is not just a legal requirement—it's the bedrock of a stable and profitable presence in the Philippines

To help your business maintain its legal standing and avoid costly penalties, Starlight Business Consulting Services has compiled a guide to the most critical tax and compliance deadlines you need to be aware of.

1. Annual Corporate Tax and Financial Reporting

The most crucial annual milestone is the filing of the Annual Income Tax Return (AITR) and the submission of Audited Financial Statements (AFS).

  • Deadline: On or before the 15th day of the fourth month following the close of the fiscal year. For businesses following the calendar year, this deadline is April 15th of the following year.

  • Key Requirement: The AFS must be prepared in accordance with Philippine Financial Reporting Standards (PFRS) and certified by an independent Certified Public Accountant (CPA) accredited by the Bureau of Internal Revenue (BIR).

  • Starlight Insight: Proactive tax planning and the use of accredited, local CPAs are essential. Our team ensures your records are accurate and filed correctly, audit and penalties.

2. Quarterly and Monthly Tax Filings

Philippine tax regulations require frequent reporting and remittance of various taxes throughout the year.

a. Value Added Tax (VAT) / Percentage Tax

  • Monthly VAT (E-Filing and Payment): Due on the 20th day of the following month (or 25th for large taxpayers).

  • Quarterly VAT (Declaration and Payment): Due on the 25th day of the month following the end of the taxable quarter.

b. Withholding Tax

The Philippines employs a robust system of withholding taxes. The main types for a typical business are:

  • Expanded Withholding Tax (EWT) & Final Withholding Tax (FWT): Due on the 10th day of the month following the withholding (or 15th day for e-filers).

  • Compensation Withholding Tax (WTC): Due on the 10th day of the month following the withholding.

3. Mandatory Regulatory & Administrative Filings

Beyond the BIR, a foreign company must also comply with deadlines set by other key regulatory bodies.

Why Timely Compliance is Non-Negotiable

Failing to meet these deadlines can result in significant financial consequences, including:

  • Surcharges and Penalties: The BIR imposes stiff penalties, including a 25% surcharge on the unpaid amount, 20% annual interest, and compromise penalties.

  • Suspension or Revocation: Repeated non-compliance can lead to the suspension or revocation of your business's registration and licenses.

  • Reputational Damage: Compliance issues can harm your company's standing with clients, partners, and government entities, severely impacting future operations.

 

Don't let deadlines put your business at risk. Let our team of local Certified Public Accountants (CPAs) and experienced financial experts be your trusted partners in the Philippines.                                                                                                        

Should you have any questions regarding your expansion strategy, please contact us at [email protected].