Taxes on UITFs are handled in a way that keeps things simple for you, with applicable taxes generally settled at the fund level. Tax rules also changed recently, so here's a high-level guide, with a note to confirm the specifics for your situation.
For most investors, taxes that apply to a fund's investments are handled at the fund level rather than something you compute and file yourself. Any such taxes are already reflected in the fund's daily price, so the returns you see are generally shown net of applicable taxes and fees. You don't receive a separate tax bill for simply holding or redeeming a regular fund.
Did the tax rules change recently?
Yes. A 2025 tax reform law (the Capital Markets Efficiency Promotion Act, or CMEPA) updated how investment income is taxed in the Philippines and aimed to simplify and standardise the rules. Because the treatment can depend on the type of fund and your own circumstances, it's best to rely on the fund's official documents and current guidance rather than older information.
What about PERA funds?
Funds held in a PERA account enjoy special tax advantages (not having to pay 20% tax so you get higher yields), including tax-free growth and tax-free qualified withdrawals, which is a key reason PERA is attractive for retirement. These are covered in the "What are the tax advantages of PERA?" article by DragonFi.
Good to know
This article is general information, not tax advice, and tax rules can change. For how taxes apply to your specific situation, it's best to check the fund's official documents or consult a qualified tax professional or the Bureau of Internal Revenue (BIR). You can find each fund's official documents on its page in the DragonFi app.