Based on my experience in registering a retail and wholesale business, I should say that business registration here in the Philippines is quite simple but it may take roughly a month or two to fully accomplish.
Here are some things to remember before registering a business in our country:
Link: Requirements
Where are you located?
You should have established your location of business, may it be a shop, an office, a branch, or a kiosk. Proof of occupancy on the said location will be required by the government. For me it was an office, my room to be exact.
Due to the nature of business being online (E-commerce), I frankly just needed my computer to run the business. In this case, what I needed were some documents as proof that we owned the place and a signed letter (with ID’s) from the title holder, stating I was given authority to establish an office at our location.
Ready Options for your Company Name
In choosing a company name, the Department of Trade and Industry (DTI) might not approve your chosen company name immediately. Make sure to have a number of options ready. I learned this the hard way by picking a name on the spot because of my experience with DTI.
That time, I was about to register “BAGS-SPOT ENTERPRISES” because my previous E-commerce website was www.bags-spot.com (inactive). Funny enough, DTI said that since you are will be selling bags, you should not have the word “bags” on your company name. It should be general in nature, like your name. This is probably an advertising rule of some sort.
Knowing your neighbors
For the Barangay Business Registration Clearance, the government might require you to have your neighbours sign a certain document indicating that you will be setting up shop nearby. So… be kind to your neighbours. 🙂
How much should you prepare?
For a small business, such as what I’ve established, you would need roughly around 15,000 Php – 20,000 Php to complete all government requirements. This may vary depending on your industry and the number of employees you have or are planning to hire.
Prove that you’re a Citizen!
Birth Cert, ID’s, NBI Clearance, Cedula. Yeah, all the stuff you need when you’re applying for a Job. But in this case, you’re applying to be the employer. Oh and by the way, it might be much harder to register if you are a foreigner.
Think TAX!
It’s better to have an accountant to help you here. Unfortunately, in my case, I didn’t have one. Bureau of Internal Revenue (BIR) will expect you to know something about taxation. Mostly, tax types, VAT or NON-VAT (PERCENTAGE TAX) and how to file it.
I’m not an accountant, nor am I a math guru, but because of the fiasco with BIR I was forced to learn a few tricks! ALL I can say is that IF you’re expecting your annual income to be less than 3 million PHP, you can go PERCENTAGE TAX wherein only 3% of your company’s income shall be required by the government as of 2019.
For annual income of more than 3 million PHP, it is required to go VAT REGISTERED where you will have to learn the wonders of INPUT and OUTPUT tax (mine’s currently VAT Registered and I find it quite amusing actually).
Receipts!
It’s much better if you have a trusted printing press that is accredited by BIR so that you can get a discount for your receipts. Prices would vary depending on the actual size of your receipt. The price of these booklets range from 1,000 – 3,000 PHP per 10 booklets, which would expire in 5 years.
SALES related companies need SALES INVOICE, DELIVERY RECEIPTS, and COLLECTION RECEIPTS. – SERVICE related companies, you would need an OFFICIAL RECEIPT.
Last words..
Preparation is key for a successful and seamless business registration. From a first time entrepreneur, I am happy to share these experiences with everyone. There’s a lot of things I’ve missed since I’ve only written about my memorable experiences. Feel free to comment your thoughts and add-on details. Cheers!
