Philippines VAT rates and VAT compliance - Avalara

Filipino VAT rates

VAT is due on all goods and services supplied domestically or imported. Exports are exempted.

The following VAT rates are in place:

Philippines VAT rates

Rate	Type	Which goods or services
18%	Higher	"Amusement tax" on night clubs, bars, cabarets etc
12%	Standard	All other taxable goods and services
0%	Reduced	Exports; international shipping; passenger transport; renewable energy
0%	Zero	Sale or import of certain agricultural goods; passenger transport; domestic gas and water; financial services and insurance; medical supplies; real estate; newspapers and books

Philippines VAT compliance

Tax Point

The date on which VAT becomes due is known as the tax point or time of supply. In the Philippines this is the time of the transaction, including continuous supplies. For services, it is the time of payment. A prepayment or deposit will trigger a VAT liability.

For imports, the VAT liability occurs at the time of clearing customs.

VAT Invoices

The following information should be included on all VAT invoices to ensure the customer may reclaim the output VAT:

Date
Unique, sequential invoice number
Vendor’s tax identification number (TIN) and details
Customer’s TIN and details for invoices above PHP1,000
Description of the goods (including quantities, units etc) or services
Net, VAT and gross amounts

Invoices may be made out in foreign currencies, converted into pesos using a public exchange rate. There are no simplified invoices for B2C transactions.

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