Question On Income Tax Applicable On A Foreigner In Philippines / Manila

[vicegerent]

Dear All,I have a question on income tax applicable for an expat or foreigner.I have been offered a job in Manila. Its a permanent role. So I would like to know the exact tax rates and when I come will I be classed as a Non-resident alien or resident alien.Please advice if anyone has any info on tax rates applicable to a foreigner on income they earn in Philippines.Many thanks,vicegerent

[Jake]

Dear All,I have a question on income tax applicable for an expat or foreigner.I have been offered a job in Manila. Its a permanent role. So I would like to know the exact tax rates and when I come will I be classed as a Non-resident alien or resident alien.Please advice if anyone has any info on tax rates applicable to a foreigner on income they earn in Philippines.Many thanks,vicegerent

Welcome Vicegerent, Congratulations on your permanent assignment in Manila. I'm sure one of our members would be able to assist you regarding income tax in the Philippines. Very interesting title sir -- Vicegerent.Respectfully -- Jake

[vicegerent]

Welcome Vicegerent, Congratulations on your permanent assignment in Manila. I'm sure one of our members would be able to assist you regarding income tax in the Philippines. Very interesting title sir -- Vicegerent.Respectfully -- Jake

Hi Jake,Thanks for such a warm welcome.... lol glad you liked my title.Yeah I hope to get some advice on my topic as I need to make quick decision to inform future employer.Any expats members who are currently working on jobs in Manila would be able to help I guess.Regards,Vice

[Jollygoodfellow]

Dear All,I have a question on income tax applicable for an expat or foreigner.I have been offered a job in Manila. Its a permanent role. So I would like to know the exact tax rates and when I come will I be classed as a Non-resident alien or resident alien.Please advice if anyone has any info on tax rates applicable to a foreigner on income they earn in Philippines.Many thanks,vicegerent

I certainly are no expert or have any experience with this but as a guess everyone who works will pay tax no matter where they are from.As for non resident or resident my question to you is what visa are you planning on using to work?You might find something here, http://www.bir.gov.ph/home.htm

[Mr Lee]

Dear All,I have a question on income tax applicable for an expat or foreigner.I have been offered a job in Manila. Its a permanent role. So I would like to know the exact tax rates and when I come will I be classed as a Non-resident alien or resident alien.Please advice if anyone has any info on tax rates applicable to a foreigner on income they earn in Philippines.Many thanks,vicegerent

First of all welcome to the forum. :SugarwareZ-037: Next HERE is a page on Philippine tax rates, and while I am not an expert either on Philippine taxes, I have found it best to deal with a Philippine tax account on such matters, but my understanding is that if the money is indirectly earned outside the Philippines and paid to you outside the Philippines, then it should not be taxable in the Philippines except for the fact that we all (those of us living within or even visiting) pay Value Added Tax (VAT) on items we purchase and also all pay tax on any interest we earn while having money in a Philippine bank account.Hopefully one of our other members will have a more direct answer if you can tell us more about the situation you will find yourself in. As far as your status, it would most likely depend on your visa but few people become resident aliens from my understanding of the system unless you are married to a Filipino citizen.

[Jollygoodfellow]

Dear All,I have a question on income tax applicable for an expat or foreigner.I have been offered a job in Manila. Its a permanent role. So I would like to know the exact tax rates and when I come will I be classed as a Non-resident alien or resident alien.Please advice if anyone has any info on tax rates applicable to a foreigner on income they earn in Philippines.Many thanks,vicegerent

First of all welcome to the forum. :SugarwareZ-037: Next HERE is a page on Philippine tax rates, and while I am not an expert either on Philippine taxes, I have found it best to deal with a Philippine tax account on such matters, but my understanding is that if the money is indirectly earned outside the Philippines and paid to you outside the Philippines, then it should not be taxable in the Philippines except for the fact that we all (those of us living within or even visiting) pay Value Added Tax (VAT) on items we purchase and also all pay tax on any interest we earn while having money in a Philippine bank account.Hopefully one of our other members will have a more direct answer if you can tell us more about the situation you will find yourself in.

There's not enough info from the OP,is this a Philippines owned company he is going to work for?Is the question regarding income tax in his own country or the Philippines?

[vicegerent]

Thank you both for your warn welcome and reply.The company that is hiring me said that they will be applying for 2 year visa for me and my spouse. I had the understanding that initially a 3 month visa will be given as in case with Thailand and Germany... that you go first on a 3 month visa... then while in thailand the employer will extend your visa to 1 year...when the initial 3 month visa is about to expire.However, today my future employer in Philippines said... initial itself they will file for me 2 year visa both for me and spouse.Also, my employer will be assigning Erst and Young to deal with my tax issues. They said Erst and Young will file my tax papers and take care of everything... and my employer will bear the cost for that.So, based on the visa they are applying for me, I am not sure if I will be classed as Non-residential Alien or something else. Hope the info I have provided gives a better picture... so any ideas?

[vicegerent]

There's not enough info from the OP,is this a Philippines owned company he is going to work for?Is the question regarding income tax in his own country or the Philippines?

I am not sure if the company located in Philippines is Philippines owned company or not. But what I can say for sure is that they are a German company, head quartered in Germany and they run business in over 50 other countries.My question with regards to Income tax is how much I will pay from my income in Philippines. I dont have to pay any tax in my home country unless I work in my home country.

[Mr Lee]

Thank you both for your warn welcome and reply.The company that is hiring me said that they will be applying for 2 year visa for me and my spouse. I had the understanding that initially a 3 month visa will be given as in case with Thailand and Germany... that you go first on a 3 month visa... then while in thailand the employer will extend your visa to 1 year...when the initial 3 month visa is about to expire.However, today my future employer in Philippines said... initial itself they will file for me 2 year visa both for me and spouse.Also, my employer will be assigning Erst and Young to deal with my tax issues. They said Erst and Young will file my tax papers and take care of everything... and my employer will bear the cost for that.So, based on the visa they are applying for me, I am not sure if I will be classed as Non-residential Alien or something else. Hope the info I have provided gives a better picture... so any ideas?

THIS section I believe will answer your visa question but Philippines visa issues can be very difficult to answer, so I hope someone has a better answer for you if you hang around until other members reply.NON-IMMIGRANTS(g)    An alien coming to pre-arranged employment, for who the issuance of a visa has been authorized in accordance with section twenty of this Act, and his wife and his unmarried children under twenty-one years of age, if accompanying him or if following to join him within a period of six months from the date of his admission into the Philippines as a non-immigrant under this paragraph.An alien who is admitted as a non-immigrant cannot remain in the Philippines permanently. To obtain permanent admission, a non-immigrant alien must depart voluntarily to a foreign country and procure from the appropriate Philippine consul the proper visa and thereafter undergo examination by the officers of the Bureau of Immigration at a Philippine port of entry for determination of his admissibility in accordance with the requirements of this Act.

[vicegerent]

THIS section I believe will answer your visa question but Philippines visa issues can be very difficult to answer, so I hope someone has a better answer for you if you hang around until other members reply.NON-IMMIGRANTS(g) An alien coming to pre-arranged employment, for who the issuance of a visa has been authorized in accordance with section twenty of this Act, and his wife and his unmarried children under twenty-one years of age, if accompanying him or if following to join him within a period of six months from the date of his admission into the Philippines as a non-immigrant under this paragraph.An alien who is admitted as a non-immigrant cannot remain in the Philippines permanently. To obtain permanent admission, a non-immigrant alien must depart voluntarily to a foreign country and procure from the appropriate Philippine consul the proper visa and thereafter undergo examination by the officers of the Bureau of Immigration at a Philippine port of entry for determination of his admissibility in accordance with the requirements of this Act.

The terminology they use does not make it easy to understand. Here they are using the word "NON-IMMIGRANT". While on the tax sites they use the terminology as "Non-Resident Alien"So quite confusing to be honest.