Whether you’ve chosen to be a sole proprietorship, partnership or corporation, you will need to sign your business up at many government agencies such as the local government unit (“LGU”), the Social Security System (“SSS”), the BIR and others. What follows is a guide through many of the typical licenses and permits needed to run a business.
A. Local Government Units
A barangay clearance is a pre-requisite
for the issuance of the local government business permit.
2. City Government or Municipal Government
All businesses are required to register their business with the City Government or the Municipal Government. Unfortunately, the procedure for the registration may differ depending on the city or municipality concerned. Below is a list of the general requirements needed to secure a Business/Mayor’s permit.
a) Barangay Clearance
b) Community Tax Certificate with Gross Receipt
c) Financial Statement (Partnerships and Corporations)
d) BIR Clearance
e) SSS Clearance
Additional Requirements for New Businesses:
a) DTI Registration (Sole Proprietorships)
b) SEC Registration (Partnerships and Corporation)
B. Bureau of Internal Revenue (BIR)
The corporation is required to register with the BIR for the issuance of the TIN as well as the issuance of the Authority to Print (for receipts) and the registration of the new set of the books of accounts that the corporation will be using.
BIR Procedure: Application of Tax Identification Number (TIN), Authority to Print (ATP) and Registration of Books of Accounts
Issuance of TIN
1. Accomplished BIR Form 1903
2. Copy of SEC Registration and Articles of Incorporation
3. Copy of Mayor’s Business Permit or duly received application for Mayor’s permit, if the former is still in process with the LGU
4. Other documents, if applicable:
a. Contract of Lease
b. Certificate of Authority of Barangay for Micro Business Enterprise
c. Franchise Agreement
d. License to do Business in the Philippines, in case of resident foreign corporation
e. Pr oof of registration/Permit to Operate with BOI , Subic Bay Metr opolitan Authority ( “SBMA”), Philippine Bases Conv ersion and Development A uthority (“BCDA”), PEZA.
For new application of ATP
1. BIR Form 1906
2. Job Order
3. Final and Clear Sample of Principal and Supplementary Receipts/Invoices
For the registration of the Books of Accounts
New set of books of accounts
a) Accomplish BIR Form 1903 and submit the same together with the documentary requirements to the Revenue District Office (“RDO”) having jurisdiction over the place where the head office and branch, respectively.
b) Pay the Annual Registration Fee (P500.00) at the Authorized Agent Banks (AABs) of the concerned RDO.
c) Pay Documentary Stamp Tax (DST) (loose DST / BIR Form 2000* for DST on Contract of Lease, etc.). Present proofs of payment.
d) Submit requirements for ATP and registration of books of accounts.
e) Attend the taxpayer’s initial briefing to be conducted by the RDO concerned for new registrants in order to apprise them of their rights and duties/responsibilities.
f) The RDO shall then issue the Certificate of Registration (Form 2303) together with the “Ask for Receipt” notice, Authority to Print and Books of Accounts.
1. Corporations shall accomplish and file the application on or before the commencement of the business, or within 30 calendar days from the issuance of the Mayor’s Permit/Professional Tax Receipt (“PTR”) by the LGU or Certificate of Registration issued by the SEC whichever comes earlier.
2. Where DST is required to be paid within 5 days after the close of the month, BIR registration shall be done on or before payment of DST becomes due.
C. Other Government Mandated Benefits
Since the corporation will be hiring workers or employees, it is required under the law to register the corporation as an employer, and register its employees, with the Social Security System, Home Mutual Development Fund and Philippine Health Insurance Corporation.