13th-month pay
A yearly pay benefit equal to at least one-twelfth of the basic salary earned during the calendar year, due by December 24.
Read the guide on 13th-month payGlossary
Philippine business glossary for foreign founders
Plain-English definitions of the company, tax, payroll and visa terms foreign founders meet in the Philippines, each with the guide that covers it.
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60/40 rule
A rule that caps foreign equity in some Philippine sectors. Where it applies, Filipino partners must hold the required minimum, commonly 60%.
Read the guide on 60/40 rule9(g) visa
The standard long-term work visa for a foreigner employed by a Philippine company. The employer sponsors it, and it is tied to that employment.
Read the guide on 9(g) visaA
AEP
Alien Employment Permit, the DOLE work permit that authorises a foreign national to work for a specific employer in the Philippines.
Read the guide on AEPAFS
Audited Financial Statements, the annual financial statements a corporation files with the SEC. Companies above the SEC size thresholds need an independent CPA audit before filing.
Read the guide on AFSAnti-Dummy Law
A law that makes it a crime to use a Filipino as a front to evade a nationality restriction while a foreigner secretly owns, controls or benefits from the business.
Read the guide on Anti-Dummy LawArticles of incorporation
The filing that incorporates a company with the SEC. Incorporators submit it with the By-Laws through eSPARC or OneSEC.
Read the guide on Articles of incorporationATP (Authority to Print)
The BIR authority a company not yet under mandatory e-invoicing needs before printing official receipts or sales invoices.
Read the guide on ATP (Authority to Print)B
Beneficial owner
A natural person who owns a stake in a company, directly or through other entities, and whom the company must declare to the SEC.
Read the guide on Beneficial ownerBIR
The Bureau of Internal Revenue, which issues each company its Tax Identification Number (TIN) and Certificate of Registration (COR).
Read the guide on BIRBOI
The Board of Investments, the main investment promotion agency that grants incentives to enterprises operating outside special economic zones.
Read the guide on BOIBooks of accounts
The ledgers a business keeps to record its transactions, kept as manual, loose-leaf or computerized books and registered with the BIR through ORUS.
Read the guide on Books of accountsBranch office
A foreign company's extension in the Philippines that can solicit orders and earn local income. It operates as part of the foreign parent and remits profits to head office.
Read the guide on Branch officeBSP registration
Registration of a foreign investment with the Bangko Sentral ng Pilipinas, usually through an authorized agent bank. A registered investment lets you buy foreign currency from a Philippine bank to send capital and dividends home.
By-laws
A corporation's internal rules. They are submitted to the SEC with its Articles of Incorporation during incorporation.
Read the guide on By-lawsC
CAR/eCAR
The Certificate Authorizing Registration, which the BIR issues once capital gains tax and related taxes on a transfer are paid. A transfer cannot be recorded without it.
Read the guide on CAR/eCARCMEPA
Republic Act 12214, which revised documentary stamp tax rates and the capital gains tax on unlisted shares. Foreign-owned companies need to act on these changes.
Read the guide on CMEPACOR (BIR Form 2303)
The BIR Certificate of Registration (BIR Form 2303). It lists the company's TIN, registered name, address and taxes, and must be displayed at its place of business.
Read the guide on COR (BIR Form 2303)Corporate secretary
A Philippine citizen and resident whom the corporation must appoint. The role keeps the stock and transfer book, certifies resolutions and minutes, and files the GIS.
Read the guide on Corporate secretaryCorporate treasurer
A corporate officer whom the Revised Corporation Code (RA 11232) requires to be a resident of the Philippines, though not necessarily a Filipino citizen.
Read the guide on Corporate treasurerCREATE MORE
Republic Act 12066, the CREATE MORE Act, which reformed Philippine investment incentives for businesses.
Read the guide on CREATE MORED
De minimis benefits
Small, itemized perks, such as rice subsidies and uniform allowances, that stay tax-exempt as long as each one stays within its BIR ceiling.
Read the guide on De minimis benefitsDOLE
The Department of Labor and Employment, which issues Alien Employment Permits and handles the employer registration of companies that hire workers.
Read the guide on DOLEDST
Documentary stamp tax, charged on certain documents and share transactions, including the tax due when shares are transferred.
Read the guide on DSTE
EOPT
Republic Act 11976, the Ease of Paying Taxes Act. It unified official receipts and sales invoices, dropped the annual registration fee and reset VAT timing.
Read the guide on EOPTEOR
An employer of record is a Philippine provider that lets a foreign company hire people legally without setting up its own entity.
Read the guide on EORF
FINL
The Foreign Investment Negative List, the government list of activities where foreign ownership is restricted, capped or reserved to Philippine nationals.
Read the guide on FINLFSIC
Fire Safety Inspection Certificate, issued by the Bureau of Fire Protection and commonly required to renew a business permit.
Read the guide on FSICG
GIS
The General Information Sheet, the annual SEC filing that reports a company's directors, officers and shareholders. It is due within 30 days of the annual meeting.
Read the guide on GISH
HARBOR
The SEC registry, linked to its eFAST system, where companies declare their beneficial owners.
Read the guide on HARBORL
Locational clearance
A local zoning clearance for the company's address. It is one of the requirements that feed into the mayor's permit, alongside fire safety and sanitary permits.
Read the guide on Locational clearanceM
Mayor's permit
The business permit issued by the city or municipal government. It is the legal licence to operate at a given address and is renewed every year.
Read the guide on Mayor's permitMinimum wage (regional wage order)
The daily minimum pay set by each regional wage board through a wage order. The rate depends on the region and city tier where the employee works.
Read the guide on Minimum wage (regional wage order)N
NWPC/RTWPB
The National Wages and Productivity Commission sets wage policy, while Regional Tripartite Wages and Productivity Boards issue the regional wage orders.
Read the guide on NWPC/RTWPBO
OPC
One Person Corporation, a corporation with a single stockholder who is also its sole director and president, under the Revised Corporation Code.
Read the guide on OPCORUS
The BIR's Online Registration and Update System, used to register books of accounts and obtain a Certificate of Registration.
Read the guide on ORUSP
Pag-IBIG
The Pag-IBIG Fund, also called the Home Development Mutual Fund (HDMF), one of the three agencies where employers must register and remit monthly contributions.
Read the guide on Pag-IBIGPEZA
The Philippine Economic Zone Authority, which registers export enterprises operating inside special economic zones that receive tax incentives.
Read the guide on PEZAPhilHealth
The Philippine Health Insurance Corporation, one of the three agencies where employers must register and remit monthly contributions.
Read the guide on PhilHealthR
RDO
The Revenue District Office with jurisdiction over a company's registered address. The company submits its TIN application there.
Read the guide on RDORepresentative office
A foreign company's office in the Philippines that cannot earn income. It is funded by annual support from the parent company.
Read the guide on Representative officeResident agent
A person or domestic corporation that a licenced foreign company appoints to receive legal process and SEC notices on its behalf.
Read the guide on Resident agentRHQ/ROHQ
A Regional Headquarters (RHQ) is a non-income supervisory centre for regional affiliates. A Regional Operating Headquarters (ROHQ) can earn revenue by providing services to them.
Read the guide on RHQ/ROHQS
SEC
The Securities and Exchange Commission, the primary registration authority for corporations and partnerships in the Philippines.
Read the guide on SECSIRV
The Special Investor's Resident Visa, which gives qualifying foreign investors indefinite residence in the Philippines.
Read the guide on SIRVSRRV
The Special Resident Retiree's Visa, issued by the Philippine Retirement Authority. It gives qualifying foreign retirees indefinite, multiple-entry residence.
Read the guide on SRRVSSS
The Social Security System, one of the three agencies where employers must register and remit monthly contributions.
Read the guide on SSSV
VAT
The 12% value-added tax on the sale of goods and services and on importation. Zero-rated and VAT-exempt transactions are treated differently.
Read the guide on VATW
Withholding tax
Tax a company deducts from payments such as salaries, rent and professional fees, then remits to the BIR. The company acts as a withholding agent and a taxpayer.
Read the guide on Withholding tax