FEES AND COMMISSIONS IF YOU INVEST IN PHILIPPINE STOCK MARKET

1. Broker's Commission Max of 0.25% of gross trade amount or P20, whichever is higher Buyers and Sellers of stocks
2. VAT on Broker's Commission 12% of Broker's Commission Buyers and Sellers of stocks
3. SCCP or Clearing Fee 0.01% of gross trade amount Buyers and Sellers of stocks
4. PSE Transaction Fee 0.005% of gross trade amount Buyers and Sellers of stocks
5. Sales Tax 0.5% of gross trade amount Sellers only

Explanation of Stock Fees, Taxes and Charges in the PSE

• Brokerage commission. You use a broker, regardless if a live broker or online broker, to help facilitate the buying and selling of stocks. They make money from the commissions charged on your every trade. Remember, the more trades you do with them — even if the transaction is to sell at a loss — they get to earn commissions from the trade. So be wary if they keep on telling you to trade, even if you’re not comfortable with the transaction. Broker’s commission vary per broker, but the maximum rate they can charge is 1.5% of the transaction amount, or a fixed minimum fee of P20, whichever is higher. The transaction is also charged an additional 12% VAT.

• SCCP or Clearing Fee. When you buy a stock, you pay money and, in return, you get ownership of that stock. There is an agency that facilitates proper stock clearing and settlement. In simple terms, they ensure that your payment as buyer goes to the seller of the stock and the stock is properly transferred to your name. This agency is the “Securities Clearing Corporation of the Philippines” or the SCCP, a wholly-owned subsidiary of the Philippine Stock Exchange Inc. Their role is to synchronize the transfer of funds and securities to the beneficial owner. The stock seller, through their broker, must deliver the securities to the SCCP and, once the securities are properly transferred, the SCCP transfers funds to them as payment for the sale. For the work that they do, they charge 0.01% of the transaction amount.

• PSE Transaction Fee. The Philippine Stock Exchange charges 0.005% of the gross trade amount for every stock transaction.

• Stock Transaction or Sales Tax. The government, of course, earns money too from stock trading transactions by charging 0.5% whenever a stock selling transaction is made. Take note this tax is charged even if the transaction resulted in a loss.

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