In a continued effort to modernise its VAT regime for digital transactions, the Philippines Bureau of Internal Revenue (BIR) issued two key memoranda in May and June 2025, introducing a dedicated VAT return for Non-Resident Digital Service Providers (NRDSP) and announcing a new operational e-filing platform.
Some key developments include:
- Form No. 2550-DS – New VAT return for NRDSPs
- On 30 May 2025, the BIR released Revenue Memorandum Circular (RMC) No. 052-2025, introducing Form No. 2550-DS: the VAT Return for Non-Resident Digital Service Providers
- This form is now the designated vehicle for reporting and remitting VAT on qualifying digital services supplied to customers in the Philippines.
- Extension of registration deadline
- Due to delays in launching the supporting systems, the BIR issued RMC No. 058-2025 on 11 June 2025, extending the registration deadline for NRDSPs to 1 July 2025
- The extension was granted due to the unavailability of the VAT on Digital Services (VDS) Portal and the Online Registration and Update System (ORUS).
- ePortal Now Operational
- As of 1 July 2025, the VDS Portal has officially launched and is now operational, enabling non-resident service providers to register, file VAT returns and make payments entirely online.
- Registration threshold and scope
- VAT Registration is mandatory for non-resident digital service providers whose gross sales exceed PHP 3,000,000 (~ €47,000) within any 12-month period.
- Registration and reporting are conducted via the BIR eServices Portal.
What Qualifies as “Digital Services”?
Digital Services include automated or electronically supplied services provided via the internet or electronic networks.
Examples include:
- Platforms & services
- Online search engines
- Online marketplaces
- Cloud computing services
- Online platforms and advertising
- Telecommunications and broadcasting services
- Digital goods & content:
- E-books, music, software, apps, games and video downloads
- Streaming services (music, news, courses, entertainment)
- Licensing of digital content and cloud systems
- Software maintenance (e.g. antivirus services)
- Data storage and virtual assets
Non-resident providers must register and comply if they exceed the threshold, even without a physical presence in the Philippines.
A simplified VAT return (Form 2550-DS) is provided to reduce administrative burden.
Virtual assets, including NFTs and other tokenised digital products, are also included in the taxable scope.
The launch of the ePortal and formalisation of VAT filing obligations reflects the Philippines’ broader strategy to ensure equal tax treatment between domestic and foreign digital suppliers and to enhance VAT compliance in the digital economy.
NRDSPs should ensure they are registered and compliant by the new deadline and familiarize themselves with the ePortal functions and VAT return process.
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Authors
Lisa Dowling
Specialising in International VAT Compliance solutions, Lisa brings a wealth of knowledge and insight in her dealings with a host of international clients ranging from start-ups through to multinationals. With 21 years VAT experience behind her, Lisa has managed VAT compliance issues and solutions globally for for over 11 years. Fintua have 12,000 + corporate clients in over 109 countries and many of these are members of the Fortune 500.
