Stock Market Tax Philippines

Do you need to file an income tax return when you are investing / trading in the Philippine stock market? The answer is No.


Sec. 127 (D) of the National Internal Revenue Code

“(D) Common Provisions. – Any gain derived from the sale, barter, exchange or other disposition of shares of stock under this Section shall be exempt from the tax imposed in Sections 24(C), 27(D)(2), 28(A)(8)(c), and 28(B)(5)(c) of this Code and from the regular individual or corporate income tax. Tax paid under this Section shall not be deductible for income tax purposes.”

You do not need to declare your income thru trading stocks. This does not mean that the stock market is the haven for task reduction. There is still tax in doing business in the stock market, that is called the stock transaction tax, which is around 1/2 % of the total stock transaction. Also, dividends paid out to investors are under a 10% withholding tax. If there is withholding tax, you do not need to declare it in your income tax just like money earned thru interest on banks, they are subjected to withholding tax, so you do not need to declare them.