Documentary stamp tax on a loan, charged once at 1.50 pesos per 200.
Documentary stamp tax
—
Net proceeds if deducted
—
Effective rate
—
The one-time stamp on money you borrow
Every loan agreement, promissory note, or debt instrument signed in the Philippines carries documentary stamp tax. The Bureau of Internal Revenue charges it once, at the moment the debt is created, on the principal you borrow. It is not interest, it is not a bank fee, and it does not recur. Think of it as the cost of putting the loan on paper. Banks rarely bill it as a separate item you mail in yourself; they handle the remittance and recover it from you, usually by netting it out of the loan proceeds or folding it into your first statement.
This calculator takes a single input, the loan principal, and returns the DST and what your net proceeds would be if the lender deducts it upfront. The rate this calculator applies is 0.75 percent of the principal, which the law expresses as PHP 1.50 for every PHP 200 borrowed. It is built for borrowers comparing loan offers, small businesses drawing down financing, and anyone who wants to see the real cash that lands in their account after the stamp comes off the top. Treat the rate as the calculator's assumption and confirm the current figure with the BIR, since stamp rates can be revised.
Reading the stamp as a cost of credit
Because the DST is taken at drawdown, it behaves like an upfront fee, and that changes its sting depending on how long you hold the loan. On a five-year loan, 0.75 percent spread over the life of the debt is a rounding error against the interest you will pay. On a 30-day bridge that you roll over every month, the same 0.75 percent each time you re-document can quietly become a meaningful annualized cost. The headline percentage looks tiny, but the effective cost depends on the term, so short, repeatedly renewed borrowing is where the stamp deserves a second look.
A PHP 500,000 loan, stamped at drawdown
Take a PHP 500,000 personal loan. The DST is 0.75 percent of the principal. If the lender deducts the stamp from the proceeds, the cash that reaches you is the principal minus the DST, even though you still owe and repay the full PHP 500,000. Here is the calculation this tool runs, using the rate it applies:
| Step | Amount |
|---|
The chart shows that split: the stamp is a thin slice off the top, and the bulk of the principal still reaches your account. The proportion stays the same at any loan size, since the rate is flat.
Where the stamp actually lands on your paperwork
Borrowers are often surprised that the disbursed amount is smaller than the loan they signed for. The DST is one of the usual culprits, alongside any processing fee. Read the disclosure statement: a well-documented loan itemizes the DST so you can see it. A practical tip when comparing offers is to look past the advertised interest rate and check the net proceeds and the total finance charge, because two loans at the same rate can hand you different cash once stamps and fees are netted out. The DST itself does not change between lenders, since it is a tax, but how it is collected, deducted upfront or billed later, affects your cash flow on day one.
One edge case to watch: revolving credit lines and loans that are renewed or restructured can trigger DST again on the renewed amount, because a new instrument is being created. If you frequently roll over short-term facilities, ask the lender how the stamp is handled on each renewal so it does not surprise you.
Do I pay DST on a loan from a friend or family member?
A private loan documented by a promissory note or loan agreement is still a debt instrument, so the DST can apply just as it does to a bank loan. An informal, undocumented loan is a grey area you should not rely on. If you put the loan in writing, which is sensible for clarity, treat the stamp as part of the cost and confirm the obligation with the BIR.
Is DST charged on the credit card balance I carry?
DST treatment on credit facilities can differ from a plain term loan, and specific rules apply to certain instruments. Rather than assume, check your card or facility agreement and the current BIR rules. This calculator models the straightforward case of a loan principal stamped once at 0.75 percent.