What Trading on the PSE Really Costs: Fees and Taxes Explained

Nobody likes a surprise on a receipt. When you buy or sell a stock on the Philippine Stock Exchange, the price you see on the screen is not quite the amount that leaves — or reaches — your account. A handful of small charges sit on top of every trade. None of them is large, but knowing exactly what they are stops you from being confused by your first confirmation slip and, more importantly, keeps you from quietly bleeding returns by trading too often.

This guide lists every charge in plain terms, then shows them working on a real example. The rates below are the standard ones at the time of writing; brokers set their own commissions and the government occasionally changes the tax, so always check the fee schedule inside your own broker's app for the current figures.

The charges when you BUY

When you place a buy order, you pay the share price plus four things:

• Broker commission. This is the broker's cut. A common rate is around 0.25% of the amount you trade, usually with a small minimum (often about ₱20) so that tiny trades are not free. Some app-based brokers use flat or promotional rates — this is the one charge that varies most from broker to broker, so it is worth comparing: see the best PSE brokers for beginners.
• VAT on the commission. A 12% value-added tax applies to the commission itself (not to your whole trade). On a ₱25 commission that is ₱3.
• PSE transaction fee. A tiny exchange charge of 0.005% of the trade value.
• SCCP clearing fee. Another small charge, 0.01% of the trade value, that goes to the clearing corporation which settles the deal.

Add those up and buying costs roughly 0.3% of the trade — about ₱30 on a ₱10,000 purchase.

The extra charge when you SELL

Selling carries all the same charges above, plus one more:

• Stock Transaction Tax (STT). This is 0.1% of the gross selling value, and it is charged only when you sell, never when you buy. It was reduced from the old 0.6% rate under the Capital Markets Efficiency Promotion Act in 2025 — a real saving for ordinary investors, so be careful with older guides that still quote the higher number.

That makes selling a touch more expensive than buying — roughly 0.4% of the trade, or about ₱40 on a ₱10,000 sale.

There is good news hidden here: for shares you buy and sell through the exchange, that small transaction tax is the only tax on the trade itself. You do not file or pay a separate capital gains tax on the profit. (The 15% capital gains tax people sometimes worry about applies to unlisted shares sold privately, not to ordinary PSE trades.)

The tax on dividends

If a company pays you a cash dividend, the Bureau of Internal Revenue takes a 10% final withholding tax for resident Filipino individuals. You never have to compute or file it — the amount that lands in your account is already net of the tax. So a declared ₱1.00-per-share dividend puts ₱0.90 in your pocket. There is more on how and when dividends are paid in understanding dividends.

A worked example

Say you buy ₱10,000 worth of a PSEi company and sell the whole position later for ₱11,000 — a clean ₱1,000 gain on paper.

• Buying costs about ₱30 in commission, VAT, and exchange/clearing fees.
• Selling costs about ₱40 — the same fees plus the 0.1% transaction tax.
• Total charges across the round trip: roughly ₱70, well under 1% of the money at work.

So your ₱1,000 paper gain is really about ₱930 after costs. For a long-term holder that friction is trivial. The catch is what happens when you trade often: every in-and-out round trip pays that ~0.7% again. Flip the same ₱10,000 twenty times in a year and you have handed over roughly ₱1,400 in costs alone — before the market has even had a chance to be wrong about you. This is one of the quiet reasons overtrading is so costly.

Why this matters more than it looks

Fees on the PSE are deliberately small, and you should not let them scare you out of investing — on any sensible long-term holding they are a rounding error against the returns a good company can compound for you. What they should do is shape your behaviour: every trade has a cost, so make each one count. Buy companies you intend to hold, not tickers you intend to flip.

When you are ready to place an order and want to see these fees appear on the confirmation screen, the mechanics are covered in how to buy your first stock, and you can look up any PSEi company on our stock pages.

This article is educational and is not investment advice. Fee and tax rates are those in effect at the time of writing and can change — confirm the current figures with your broker and the BIR.