Can Your Startup Apply for BOI or PEZA? Here’s the Truth
TL;DR (Quick Summary Box)
Yes, startups can apply for BOI or PEZA incentives in the Philippines, provided they meet industry and compliance requirements. Both agencies offer tax perks, exemptions, and non-fiscal benefits that help small businesses and early-stage companies grow. The eligibility depends on your sector, ownership structure, and ability to follow BOI and PEZA requirements for small businesses.
Introduction
If you’re running a startup in the Philippines, you’ve probably heard of the Board of Investments (BOI) and the Philippine Economic Zone Authority (PEZA). These two government agencies provide tax incentives, exemptions, and support services to businesses that align with the country’s priority sectors.
But here’s the big question: Can startups apply for BOI or PEZA incentives, or are these benefits only for big corporations?
The truth is, startups and SMEs can apply—but the requirements and qualifications vary. In this guide, we’ll break it down in simple terms so you’ll know whether your business is eligible, how to apply, and what to expect.
Why Startups Should Care About BOI and PEZA
Government incentives are not just for large corporations. For startups, they can mean:
- Lower operating costs through income tax holidays.
- Exemption from import duties and taxes on capital equipment.
- Access to simplified import/export procedures.
- Easier hiring of foreign talent through visa support.
- Enhanced credibility when dealing with investors or partners.
In short, BOI and PEZA incentives can give your startup the boost it needs to compete and grow faster.
BOI Registration for Startups in the Philippines
The Board of Investments (BOI) is best for startups that operate anywhere in the Philippines (not just inside ecozones).
Key BOI Incentives for Startups:
- Income Tax Holiday (ITH) – 4 to 6 years of exemption.
- Zero duties on the importation of equipment and raw materials.
- Additional deductions on labor expenses to encourage local hiring.
- Exemption from wharfage dues and export tax.
Industries Eligible for BOI Registration:
Startups must belong to priority sectors under the Philippine Investment Priorities Plan (IPP) or Strategic Investment Priority Plan (SIPP). These typically include:
- Tech and innovation (IT-BPO, AI, software, electronics).
- Manufacturing.
- Renewable energy.
- Infrastructure.
- Export-oriented businesses.
So if your startup is in one of these areas, you may qualify.
PEZA Registration for Startups in the Philippines
The Philippine Economic Zone Authority (PEZA), on the other hand, is ideal for startups that operate within special ecozones (IT parks, manufacturing hubs, or economic zones).
Key PEZA Incentives for Startups:
- Income Tax Holiday (4–7 years), followed by a special 5% tax on gross income.
- VAT zero-rating on local purchases.
- Duty-free importation of equipment, machinery, and raw materials.
- Simplified customs procedures.
- Employment of foreign nationals with visa support.
PEZA is highly attractive for export-oriented startups—those that sell 70% or more of their goods or services abroad.
BOI vs PEZA: Which is Better for Startups?
Here’s a quick comparison:
| Criteria | BOI | PEZA |
| Location | Anywhere in the Philippines | Only inside PEZA ecozones |
| Export Requirement | Not mandatory | Must export 70% of output |
| Incentives | Tax holidays, import exemptions, deductions | Tax holidays, 5% special tax, duty-free imports |
| Best For | Startups in priority industries | Export-oriented startups |
If your startup is homegrown and not export-heavy, BOI may be the better choice. If you’re export-focused, PEZA is likely the way to go.
Step-by-Step Process for Startups Applying to BOI or PEZA
BOI Registration Process:
- Check eligibility under the SIPP.
- Prepare documents – business plan, financial projections, incorporation papers.
- Submit application to the BOI.
- Evaluation and interviews with BOI officials.
- Approval and registration are once qualified.
PEZA Registration Process:
- Located in a PEZA-accredited zone (IT park, economic zone).
- Submit the application with business documents and the project plan.
- Board evaluation of your proposal.
- Approval and PEZA certificate issuance.
BOI and PEZA Requirements for Small Businesses
While requirements vary, in general, startups must provide:
- Articles of Incorporation & By-Laws.
- Business Plan with projected financials.
- Details of activities (export percentage, industry classification).
- List of equipment and raw materials to be imported.
- Proof of location (for PEZA).
Tip: Even if you’re a small business, having a clear, scalable business plan helps you qualify faster.
Can Startups Apply for BOI or PEZA Incentives in the Philippines?
Yes. Startups can qualify for BOI and PEZA incentives if they fall under eligible industries and meet compliance requirements. Even early-stage businesses can apply, provided they show growth potential and follow proper documentation.
FAQs: BOI and PEZA for Startups
1. Can startups apply for BOI or PEZA in the Philippines?
Yes. Startups can apply if they operate in eligible industries and meet compliance requirements.
2. What are the requirements for startups to qualify for BOI registration?
Startups need to belong to BOI-priority sectors and submit business plans, incorporation papers, and financial projections.
3. Do small businesses and SMEs qualify for PEZA incentives?
Yes, as long as they operate inside a PEZA zone and meet the export requirement.
4. What industries are eligible for BOI and PEZA registration?
Tech, renewable energy, manufacturing, infrastructure, and export-oriented industries.
5. Are foreign-owned startups allowed to register with BOI or PEZA?
Yes. BOI and PEZA both allow foreign-owned startups if they comply with Philippine ownership laws and sector-specific rules.
6. What tax incentives can startups get from BOI or PEZA?
Income tax holidays, duty-free imports, VAT zero-rating, and reduced income tax rates.
7. How long does it take for a startup to get BOI or PEZA approval?
Usually 2 to 6 months, depending on completeness of documents and evaluation.
8. What documents are needed for a startup’s BOI or PEZA application?
Business registration papers, Articles of Incorporation, project plans, financial projections, and proof of location (for PEZA).
9. What’s the difference between BOI and PEZA incentives for startups?
BOI is location-flexible but sector-dependent; PEZA requires being in an economic zone and focusing on exports.
10. Can a home-based or early-stage startup qualify for BOI or PEZA?
Generally, no for PEZA since it requires a physical ecozone location. For BOI, yes, if the startup fits a priority sector.
Key Takeaways for Startup Founders
- Yes, startups can qualify for both BOI and PEZA incentives.
- BOI is flexible and covers various industries.
- PEZA is stricter, focusing on export-oriented companies in ecozones.
- Early preparation of documents and compliance is crucial.
- These incentives are not limited to big corporations—startups can benefit too.
Final Thoughts
So, can startups apply for BOI or PEZA incentives in the Philippines? Absolutely. The key is knowing your eligibility, preparing your documents, and aligning with government priority sectors.
For early-stage businesses, this could mean lower tax costs, faster growth, and better access to global opportunities. Whether you choose BOI or PEZA depends on your startup’s focus—local innovation or export-oriented operations.