General VAT information for the Philippines
| Periodic VAT return | Monthly: 20th day of the month following the end of the tax period Quarterly: 25th day following the close of each taxable quarter |
| VAT rates | 12% 0% and Exempt |
Philippines VAT Requirements
There have been improvements in recent years to VAT revenue collection in the Philippines, but there are a considerable number of exemptions from the country’s standard 12% VAT rate.
In addition to periodic VAT filing obligations, the Philippines has launched a Continuous Transaction Controls (CTC) e-reporting pilot program to improve VAT collection. It is also expected to roll out a phased expansion of this VAT control reform to the rest of the economy soon.
This page is your ideal overview for VAT compliance in the Philippines.
VAT rules in the Philippines
In the Philippines, VAT filings are due monthly or quarterly.
When filing monthly, submissions must be made no later than the 20th day following the end of the taxable month. When filing quarterly, submissions must be made no later than the 25th day following the end of the taxable quarter, aligned with the taxpayer’s income tax quarter.
Requirements to register for VAT in the Philippines
There are several qualifying factors for taxpayers who must register for VAT in the Philippines. These conditions include:
- Organisations or individuals involved in selling, leasing, exchanging goods or properties and rendering services (if gross sales amount to 3,000,000 PHP)
- Organisations or individuals who voluntarily register
- Organisations or individuals that import goods
Penalties for non-compliance with VAT in the Philippines
If you fail to meet your tax obligations in the Philippines, you may be fined 1,000 PHP per instance of failure. However, this can be avoided if the failure is proven to have been caused by reasonable cause and not by neglect.
Taxpayers cannot be charged more than 25,000 PHP in tax-related fines in a year. However, additional penalties, such as surcharges and interest, may also apply depending on the nature of the non-compliance.
Solutions for VAT compliance in the Philippines
Meeting tax obligations in the Philippines may seem complicated, but it doesn’t have to be. Choose Sovos as your compliance partner to save time and gain peace of mind that your requirements are being met.
Sovos combines solutions with regulatory expertise, serving as an extension of your team to make sure you are compliant – not just now, but in the future too. Get in touch today to get started.
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FAQ
Is there VAT in the Philippines?
Yes, the Philippines levies Valued Added Tax on goods and services. The standard tax rate is 12%.
How is the 12% VAT receipt calculated in the Philippines?
Valued Added Taxis calculated on the gross selling price of goods or gross receipts from the sale of services.
Can you claim VAT in the Philippines?
Tourists or non-resident passport holders can apply to reclaim VAT in the Philippines on goods bought from an accredited store, if goods are taken out of the country within 60 days of purchase, and goods purchased worth at least 3,000 PHP.