Ph Company Formation

---
name: ph-company-formation
description: "Source-cited draft: company formation & entity choice for Philippines (tax year 2025) — rates, thresholds and rules with primary-source citations. Unverified; pending local-accountant review."
license: "AGPL-3.0-or-later (code) / OpenAccountants Guide License v1.0 (content)"
metadata:
  source: openaccountants
  openaccountants_url: "https://www.openaccountants.com/skills/ph-company-formation"
  jurisdiction: "PH"
  tax_year: "2025"
  last_updated: "2026-07-13"
  reviewed_by: "Jonathan I. Ruiz"
---

# Philippines Company Formation & Entity Choice

## Entity types and incorporation

- **Common entity types** — Domestic stock corporation, One Person Corporation (OPC), partnership, sole proprietorship, and branch/representative office of a foreign company  _(Revised Corporation Code of the Philippines (RA 11232))_
- **Registration authority** — Securities and Exchange Commission (SEC) for corporations/partnerships; DTI for sole proprietorships  _([Revised Corporation Code of the Philippines (RA 11232)](https://esparc.sec.gov.ph/))_
- **Minimum incorporators** — 1 (One Person Corporation); 2 to 15 for an ordinary stock corporation  _(Revised Corporation Code of the Philippines (RA 11232))_
- **Minimum paid-up capital (domestic, Filipino-owned)** — No statutory minimum capital. **The 25%/25% rule is CONTESTED — do not assert it as current law.** The Revised Corporation Code (RA 11232 s.12) removed the statutory minimum and appears to have deleted the mandatory '25% of authorised capital subscribed / 25% of subscribed paid up' requirement for ORIGINAL incorporation (retaining it only for later increases in authorised capital). However, multiple 2025-dated practitioner and SEC-facing guides still describe SEC registration practice as requiring 25%/25% (with a practical floor around PHP 5,000). These do not reconcile from public sources: confirm against current SEC eSPARC/OneSEC practice before relying on either position.  _(RA 11232 s.12 vs current SEC practice guides — unresolved. Flagged by Jonathan I. Ruiz (CPA).)_
- **Minimum capital for foreign-owned domestic corporation** — USD 200,000 paid-up capital. Reduced to USD 100,000 if ANY of: (a) the enterprise involves advanced technology as determined by DOST; (b) it is endorsed as a startup or startup enabler under the Innovative Startup Act (RA 11337); or (c) a majority of its direct employees are Filipino, with an absolute floor of at least 15 Filipino employees. (RA 11647, in force 17 March 2022 — this REPLACED the old '50 direct employees' test.) USD  _(RA 11647 (2022 amendment to the Foreign Investments Act) and its IRR. Corrected by Jonathan I. Ruiz (CPA, Philippines))_
- **One Person Corporation minimum capital** — No minimum paid-up capital required (unless mandated by the industry); name must end in 'OPC'  _(Revised Corporation Code of the Philippines (RA 11232), Title XIII)_
- **Core incorporation steps** — Reserve name and file Articles of Incorporation via SEC eSPARC; register with the BIR for TIN and books; register with the LGU for a business permit (Mayor's Permit); register as employer with SSS, PhilHealth and Pag-IBIG  _(Revised Corporation Code (RA 11232); NIRC Section 236)_
- **SEC registration fee** — 1/5 of 1% of authorised capital stock (or the subscription price, whichever is higher), but NOT LESS THAN PHP 2,000 — per the SEC's own Registration Calculator. Plus a Legal Research Fee of 1% of the filing fee, itself not less than PHP 10.  _(SEC Registration Calculator (sec.gov.ph). Corrected by Jonathan I. Ruiz (CPA, Philippines))_
- **Typical incorporation timeline** — Approximately 2 to 6 weeks to complete SEC, BIR, LGU and statutory-fund registrations ((approx — varies by LGU and completeness of documents))  _(SEC / BIR registration procedures)_
- **Annual SEC compliance** — File the General Information Sheet (GIS) within 30 days of the annual stockholders' meeting and Audited Financial Statements (AFS) per SEC schedule  _(Revised Corporation Code of the Philippines (RA 11232))_
- **Annual BIR compliance** — File the annual income tax return (BIR Form 1702) with audited financial statements; renew BIR registration and pay the documentary stamp tax; renew the LGU business permit each January  _(NIRC Sections 52, 232; Local Government Code (RA 7160))_
- **Statutory audit requirement** — Independent audit and AFS required where gross annual sales/receipts exceed PHP 3,000,000 PHP  _(NIRC Section 232; SEC rules)_

## Today's figures and who stands behind this skill

This file is an AI skill (tax rules your AI follows) from OpenAccountants, copied on 2026-07-13. Rates, thresholds and deadlines change. For the current version of this skill, its official sources and the named accountant (if any) who stands behind it, call `get_skill` with slug `ph-company-formation` on the OpenAccountants connector (https://www.openaccountants.com/connect), or read https://www.openaccountants.com/skills/ph-company-formation. If neither is available, confirm every figure against the official source pages cited above before relying on it.