The Board of Investments (BOI) continues to play a pivotal role in shaping inclusive economic growth across the Philippines. One of its key strategies is to encourage enterprises to set up operations beyond Metro Manila and other highly urbanized areas. They offer fiscal and non-fiscal incentives to help decongest cities and promote countryside development.
For business owners, investors, and accountants, BOI registration opens up a wide range of opportunities. But it also introduces new layers of accounting responsibility particularly around project feasibility, capital allocation, and regulatory compliance. Understanding these elements is essential not just to qualify for incentives, but to fully benefit from them.
A Split Photo Comparison of A Congested City and a Peaceful Business Area Outside the Metro
Accounting Areas That Require Attention
Investment Planning & Financial Projections
BOI applications often require detailed financial forecasts and capital investment plans. These must reflect realistic assumptions aligned with operational scaling outside urban centers.
Capital expenditures and asset buildup must be clear and BOI-compliant
Revenue and cost modeling should reflect local market conditions
Projections must support sustainable payback periods and incentive timelines
Location-Based Incentive Qualification
BOI’s preferred investment areas often fall under less-developed regions, making site selection critical. Accountants must assess:
Tax holiday periods and income tax incentives per location
Access to infrastructure, logistics costs, and indirect tax implications
Labor and utility cost projections in non-metropolitan zones
Tracking Qualified vs. Non-Qualified Revenues
Enterprises registered under BOI often operate both BOI-registered and non-registered activities. Proper separation is required:
Separate books and reporting per activity
Clear allocation of shared expenses and common resources
Periodic compliance checks to validate incentive eligibility
Capital Infusion & Financing Structure
Financing for BOI projects typically comes from internal capital, loans, or external investment. The structure must support both project execution and compliance.
Account for foreign and local equity participation restrictions
Reflect project-specific funding and drawdown schedules
BOI incentives are time-bound. To make the most of them, enterprises must align accounting strategy with post-incentive performance. This includes:
Depreciation Schedules
That sync with income tax holidays
Cost Optimization & Cash Flow
That are long-term and sustainable
Full Tax Exposure
Planning for after incentive expiration
Enterprises should also consider the implications of VAT zero-rating, customs duty exemptions, and LGU-specific regulations.
Benefits of Establishing Operations Outside Metro Manila
From an accounting and financial lens, business decentralization offers several advantages beyond incentives:
Lower Overhead
And lease costs
Access
To untapped labor markets
Regional Government Support
And faster permit processing
Stronger Alignment
With national economic priorities
BOI registration opens the door to strategic advantages but these can only be fully realized through informed accounting, disciplined financial planning, and region-aware business modeling. For enterprises seeking long-term growth outside traditional economic zones, integrating BOI-specific considerations into financial practices is not just beneficial, it’s essential.
Navigate complex accounting requirements and capital planning.
Let's ensure that compliance and strategy go hand in hand.
