CGT on sale of shares is different from property CGT. Check whether the sale is exchange-traded before choosing a rate. A listed company’s shares sold outside the exchange need separate analysis; “listed” alone does not establish STT treatment.
How are stocks taxed in the Philippines?
How your stock profits are taxed in the Philippines depends on where and how the shares are traded, and the investor’s tax status. Listed shares sold through the PSE are subject to a stock transaction tax (STT) of 0.1% on the gross selling price, which is a final tax. Shares that are not traded on the exchange (unlisted shares) are subject to a 15% capital gains tax (CGT) on the net gain. Separately, cash and property dividends you receive are subject to a 10% final tax for resident citizens and resident aliens.
This guide reflects the rules after the Capital Markets Efficiency Promotion Act (CMEPA), Republic Act No. 12214, which took effect on July 1, 2025. CMEPA cut the STT from 0.6% to 0.1% and harmonized several investment taxes, so older articles citing 0.6% are now out of date. For broader context, see our capital gains tax guide and the withholding tax overview.
Tax on PSE-listed stocks: the 0.1% stock transaction tax
If you buy and sell shares of listed companies like Jollibee Foods Corporation, BDO, or Ayala Corporation through your online broker (COL Financial, BPI Trade, First Metro Sec, etc.), you do not compute or file any income tax or capital gains tax on the profit. Instead, every time you sell, a final stock transaction tax of 1/10 of 1% (0.1%) of the gross selling price is withheld and remitted to the Bureau of Internal Revenue (BIR) by your broker. It applies whether you gained or lost money, because it is based on the selling price, not the profit.
Because it is a final tax, the broker handles the STT on the covered trade. This does not remove filing obligations for other income. You file no BIR form for STT yourself.
Example: selling listed shares
An investor buys 1,000 shares of a PSE-listed company at ₱90 (₱90,000) and sells them a year later at ₱110 (₱110,000 gross selling price).
- Stock transaction tax: ₱110,000 × 0.1% = ₱110
- Broker commission and exchange-related charges are separate from STT; check your trade confirmation.
- For an ordinary investor’s covered PSE trade, the broker handles STT; this does not remove any other income-tax filing obligations.
Under the old 0.6% rate, that same sale would have cost ₱660 in STT. CMEPA's reduction to 0.1% is a direct saving of ₱550 on this single trade, which is the reform's headline benefit for retail investors.
CGT on sale of shares outside an exchange: 15%
For a resident individual selling investment shares outside a local or foreign exchange, for example, your stake in a family corporation or a private startup, the rules are completely different. You pay a 15% capital gains tax on the net capital gain (proceeds less the allowable cost basis and applicable selling expenses; valuation rules must also be checked). The rules cover domestic and foreign shares, subject to the investor’s tax status and income-source rules. This section is for ordinary investment holdings, not a securities dealer’s inventory.
Unlike listed shares, this is not handled by a broker. You must file and pay it yourself using the share-sale return and applicable net-gain rules, rather than the 6% property formula:
- BIR Form 1707 (Capital Gains Tax Return for shares not traded through the local stock exchange), filed within 30 days from each sale.
- BIR Form 1707-A (Annual CGT Return), filed by April 15 of the following year, consolidating all unlisted-share sales.
- Documentary stamp tax (DST) of ₱1.50 for each ₱200 of the par value of the shares transferred (filed via BIR Form 2000-OT). Note: sales of listed shares through the exchange are DST-exempt; off-exchange transfers need a separate DST check.
Example: selling a private-company stake
An investor acquires shares in a private corporation for ₱500,000 and sells them for ₱800,000.
- Net capital gain: ₱800,000 − ₱500,000 = ₱300,000
- Capital gains tax (15%): ₱300,000 × 15% = ₱45,000
- The seller files Form 1707 within 30 days and pays the ₱45,000.
- If the par value of the shares is ₱200,000, the DST is ₱200,000 ÷ ₱200 × ₱1.50 = ₱1,500, computed with our documentary stamp tax calculator.
How are stock dividends and cash dividends taxed?
When a listed or unlisted Philippine company pays you a cash or property dividend, a 10% final withholding tax applies if you are a resident citizen or resident alien. The company withholds it before the dividend hits your account, so the amount you receive is already net of tax, for this final-tax dividend. Non-resident aliens engaged in trade or business are taxed at 20%, and those not so engaged at 25%.
Stock dividends (additional shares issued pro-rata instead of cash) are generally not subject to income tax at the time of receipt, because they merely represent a reallocation of existing equity. Tax is only triggered later when you sell those shares.
For a resident individual receiving a ₱10,000 cash dividend from a domestic corporation, 10% withholding leaves ₱9,000. The payer remits the ₱1,000 final tax.
How other investment income is taxed
| Investment / income | 2026 tax treatment (post-CMEPA) |
|---|---|
| Sale of PSE-listed shares | 0.1% stock transaction tax (final) |
| Sale of unlisted shares | 15% capital gains tax on net gain |
| Cash/property dividends (residents) | 10% final tax |
| Covered resident-individual deposit interest | 20% final tax on new instruments; pre-July 2025 transition rules apply |
| Original issuance of shares (DST) | 0.75% of par/issue value |
| Pag-IBIG MP2, SSS, GSIS savings | Tax-free (confirmed by Department of Finance) |
The big change for savers: CMEPA removed the income-tax exemption that long-term time deposits (5+ years) used to enjoy, so new long-term deposits now face the flat 20% final tax on interest. Crucially, instruments entered into before July 1, 2025 keep their old treatment until maturity. Meanwhile, the Department of Finance has explicitly confirmed that Pag-IBIG MP2, SSS, and GSIS savings remain tax-free, under the exemptions in their governing laws.
Do I need to register with the BIR or report my stock gains?
For listed shares, no separate registration or reporting is needed for the trade itself; the broker's STT remittance handles the covered trade’s STT, not your other tax obligations. For unlisted shares, you must have a TIN and file Forms 1707 and 1707-A yourself. If you are also a freelancer, business owner, or professional, your trading does not change your normal income tax obligations; capital and dividend income on stocks stays under final-tax rules and is not lumped into your graduated or 8% computation. New to BIR processes? Start with our guides on how to get a TIN and BIR registration, and self-employed investors can review the self-employed taxpayer guide.
Key deadlines and forms at a glance
- Listed shares: STT 0.1%, withheld by broker, no form, no deadline for you.
- Unlisted shares: Form 1707 within 30 days of sale; Form 1707-A by April 15 next year.
- DST on unlisted transfers: Form 2000-OT, ₱1.50 for each ₱200 of par value, by the 5th day of the following month.
- Dividends: 10% withheld at source, no action needed.
Always verify current rates against the BIR before filing, since rates can change with new Revenue Regulations. For guidance on your other tax obligations, see our small business and OFW investor resources.