Minimum Capital Requirement for Corporations in the Philippines (2026 Guide)

One of the most common, and most misunderstood, questions in Philippine corporate registration is:

“How much capital do you really need to register a corporation?”

Many founders assume that the Securities and Exchange Commission (SEC) requires a fixed minimum capital to incorporate. That assumption is incorrect.

Under Philippine law, there is no single minimum capital requirement that applies to all corporations. The correct answer depends on:

1. the type of corporation being formed,
2. the nature of the business or industry, and
3. whether foreign ownership is involved.

This 2026 guide explains:

1. the legal rules on capital stock,
2. the difference between authorized, subscribed, and paid-up capital,
3. and when minimum capital actually matters.

Understanding Capital Stock

After SEC registration, corporations must complete tax registration with the Bureau of Internal Revenue (BIR), including issuance of the Certificate of Registration (BIR Form 2303) and authority to print official receipts. Current tax registration requirements are available at https://www.bir.gov.ph.

Before talking about numbers, it is essential to understand what “capital” actually means under Philippine corporate law.

Authorized Capital Stock

Authorized capital stock is the maximum number of shares the corporation is allowed to issue, as stated in its Articles of Incorporation filed with the SEC.

It represents the corporation’s capacity to raise capital, not money that must be paid immediately.

Subscribed Capital

Subscribed capital is the portion of the authorized capital that shareholders commit to purchase.

Shareholders are not required to subscribe to 100% of the authorized capital upon incorporation.

Paid-Up Capital

Paid-up capital is the portion of the subscribed capital that has been actually paid to the corporation.

This is the figure most commonly scrutinized by banks, regulators, and courts.

Is There a Minimum Paid-Up Capital?

For Most Domestic Corporations (All-Filipino)

There’s no statutory minimum paid-up capital

The Revised Corporation Code removed the old ₱5,000 paid-up capital rule.

“Stock corporations shall not be required to have a minimum capital stock, except as otherwise specifically provided by special law.”
— Sec. 12, Revised Corporation Code

A corporation may legally register with low paid-up capital, provided SEC requirements are met.

Legal vs Practical Capital

What is legally allowed is not always commercially or legally safe.

Low paid-up capital often causes problems with:

1. corporate bank account opening;
2. lease agreements;
3. suppliers and creditors;
4. government agencies; and
5. potential investors.

A corporation with ₱5,000 paid-up capital entering six-figure contracts raises immediate credibility and liability concerns.

When Minimum Capital DOES Matter

Corporations With Foreign Ownership

Foreign-owned corporations engaged in domestic market activities generally require USD 200,000 paid-up capital, subject to statutory exceptions.

This rule has been recognized in jurisprudence, including Initiatives for Dialogue v. Senate (2023).

Regulated Industries

Certain businesses have specific capitalization requirements, such as:

1. financing and lending companies,
2. insurance and pre-need entities,
3. real estate developers.

In these cases, SEC registration alone is insufficient, regulatory approval is required.

Capital in a One Person Corporation (OPC): A Special Warning

In a One Person Corporation (OPC), capitalization carries heightened legal consequences.

The law places the burden on the sole stockholder to prove:

• adequate capitalization, and
• clear separation of personal and corporate assets.

Low capitalization plus commingling of funds increases the risk of personal liability.

How Much Capital Is “Safe” in Practice?

There is no universal number. Sound practice requires capital that:

1. is reasonable relative to the business;
2. supports startup costs and contracts; and
3. does not appear merely nominal.

Courts and regulators look at substance, not just filings.

Final Note

In 2026, registering a corporation in the Philippines is procedurally easier, but structuring it correctly still requires legal judgment.

Capital is not just an accounting entry.
It is a risk-allocation and credibility decision.

Frequently Asked Questions (FAQ)

Related Reading:

Choosing the Right Business Structure in the Philippines (2026 Guide)