THE TOP 5 THINGS INVESTORS NEED TO KNOW ABOUT THE PHILIPPINES
(1) Currency control
Capital and profits generally may be freely repatriated between the banking systems of Singapore and the Philippines. For the repatriation of capital/profit for Branch Offices and Regional Operating HQs, a tax rate of 15% will be imposed.
(2) Foreign ownership restriction
A company incorporated in the Philippines must have between 5 to 15 directors. A majority of the directors must be residents of the Philippines. Additionally, all directors must hold at least 1 share each.
It is possible to have a 100% foreign-owned company except in nationalised or partially-nationalised industries where the number of directors residing in the Philippines must conform to the proportion of the equity required to be owned by Filipino nationals under the Foreign Investment Negative List.
(3) Labour requirement
The minimum wage requirement is as follows:
- For non-agriculture sectors in Metro Manila: 512 Pesos (SGD 13.45) per day
- For agriculture sector, small retail, service and manufacturing establishments: 475 Pesos (SGD 12.47) per day
(4) Land ownership
Only Filipinos can own lands. However, investors can consider leases from government-owned and privately-owned properties.
- Short term lease of 5 – 10 years
- Long term lease of up to 75 years
(5) Tax incentives
There are numerous incentives offered to foreign investors by the different statutory boards, mainly the Board of Investments (BOI) and the Philippine Economic Zone Authority (PEZA). Qualified companies may enjoy a tax holiday of up to 8 years or be exempted from local and national taxes. They may also enjoy duty-free or tax-free incentives.
THE IMPORTANCE OF WORKING WITH ADVISORS WHO KNOW PHILIPPINES
Investors will be able to:
- Understand the finer details of doing business in the Philippines
- Develop a greater appreciation of practical issues on the ground and the best ways to overcome them
- Better manage the budget for the incorporation and maintenance of the company
- Obtain holistic advice on advisory and compliance matters
YOUR IDEAL LAUNCHPAD INTO ASEAN
Singapore is an excellent base for reaching out to the region’s developing markets.
- It enjoys a low corporate income tax rate (currently at 17%), has no tax payable on dividends earned externally from its borders (subject to conditions) and offers tax incentives/financial assistance to small-medium enterprises wishing to establish operations overseas.
- There is no capital gain tax in Singapore. If a Singapore holding company were to sell its shares in the subsidiary and makes a profit, there is no capital gain tax at the Singapore holding company level.
- Strong reputation as a leading global financial hub.