How much is the income tax in the Philippines?
Wednesday, March 10th, 2010 at
12:12 am
I am currently working from the UK with a whopping 22% off my income. I will be based from the Philippines (working for my UK company) from June but I will be liable for paying my own tax. Can someone please tell me how much income tax they will take off my wages once I’m in the Philippines?
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It depends on how long are you going to stay working here in the Philippines. If it is just less than 6 months, then you will fall under the tax classification of Non Resident Alien not Engaged in Business and a final tax of 25% (not sure) shall be deducted in your income.
But if you have intentions to stay or work for long and will have the necessary work permits, you may be classified under Non Resident Alien Engaged in Trade and Business on which your income tax will be computed just like the regular Philippine employees which uses of the graduated income tax table.
The graduated income tax table rates ranges from 10% to 32% depending on which income tax bracket you will fall. Your net taxable income will also be subjected to legal deductions like for your dependents and some social benefits.
How are you going to be paid is the first question and also are you employed in the Philippines and have the correct visas?
The reason I ask is as a foreign national you cant just work in the Philippines (legally) without the correct paperwork. The next thing you need to take into account is how you get paid if you are paid in £ you can lose 5% in transaction fees. I believe the local tax is still at 12%