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ENTRY OF NON-RESIDENT PERSONNEL Enterprises registered under the Omnibus Investments Code [Executive Order No. 226] are permitted to employ foreign nationals in supervisory, technical, or advisory positions during its first five years from registration. Those majority foreign-owned registered enterprises are allowed to employ foreign nationals as president, treasurer and general managers for an indefinite period of time. In the case of Offshore Banking Units [OBUs], they are allowed to employ foreign nationals as executives in their respective units. The same may be said for executives in area headquarters of multinational corporations. For non-resident personnel of foreign firms, the entry visa requirements and description of the nature of the entry restriction are as follows: a. Special Investors Resident Visa [SIRV] - This is issued to any alien, except nationals coming from North Korea and Cambodia and such other countries that may be classified restricted in the future, who meets the following qualifications: 1. he/she had not been convicted of a crime involving moral turpitude;
2. he/she had not been afflicted with any loathsome, dangerous or contiguous disease;
3. he/she had not been institutionalized for any mental disorder or disability; and
4. he/she is willing and able to invest the amount of at least US$75,000 in the Philippines.The special feature of this visa is the grant to the investor of the privilege to reside in the Philippines for as long as his investment exists. He shall be entitled to import his used household goods and personal effects, tax and duty-free, as an alien coming to settle in the Philippines for the first time under Sec. 105(h) of the Tariff and Customs Code of the Philippines. Moreover, the investor's spouse and unmarried children under 21 years of age who join him in the Philippines may be issued the same visa. b. Pre-arranged Employment Visa - This is granted pursuant to Sec. 9(g) of the Philippine Immigration Law. This is available for employment in any executive or managerial position. c. International Treaty Investors Visa - This is granted under Sec. 9(d) of the Philippine Immigration Law. The required investment is at least P300,000.00. Only Germans, Japanese and Americans are parties to this treaty. TAXATION LAW ON FOREIGN INVESTMENTS Corporate and similar entities: [1] Foreign corporations engaged in business or trade in the Philippines - Their income derived from sources in the Philippines are taxed a flat rate of thirty-five percent [35%] based on net income. [2] Foreign corporations not engaged in business or trade in the Philippines - Their income derived from sources in the Philippines are taxed a flat rate of thirty-five percent [35%] on gross income. Further, interest income on foreign loans earned is subject to a twenty percent [20%] tax. [3] Foreign international carriers - They are taxed at the rate of two-and-a-half percent [2.5%] on their gross Philippine billings. [4] Non-resident foreign cinematographic film owners, lessors or distributors - They are taxed at the rate of twenty-five percent [25%] on gross income. [5] Foreign mutual life insurance companies - They are taxed at the rate of ten percent [10%] of their gross investment income derived from sources within the Philippines. Foreign individuals: [1] Individual resident foreigners - Their income: [a] derived from all sources in the Philippines and in foreign countries taxed from 1-35% on gross compensation income [arising from an employer-employee relationship]; and net on non-compensation [business and other] income. [b] twenty percent [20%] on royalties, prizes, winnings [final tax]. [c] twenty percent [20%] on interest on bank deposit, and on substitute arrangements [final tax]. [d] five percent [5%] capital gains tax on sale of realty [final tax]. [2] Foreigners engaged in trade or business in the Philippines - Their income: [a] derived from Philippine sources are taxed from 1-35% on gross compensation income and net on non-compensation income. [b] thirty percent [30%] on royalties, interests and dividends, and others. [3] Foreigners not engaged in trade or business in the Philippines - Their income derived from Philippine sources are taxed a flat rate of thirty percent [30%] on gross Philippine income. http://www.chanrobles.com/default4a.htm
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