You could be considering starting a business if you want to be your own boss. However, you can’t begin functioning right away even if you have a terrific business plan, prepared your merchandise, and hired your staff.
It must first be registered.
Local and foreign business owners in the Philippines are obliged by law to register their companies with several organizations.
The Securities and Exchange Commission, also known as the Department of Trade and Industry, the Local Government Unit where your company is located, and then the Bureau of Internal Revenue, also known as the BIR, are included in this.
For newcomers, the process of registering a business in the Philippines may appear frightening and challenging, but you’ll be amazed at how easy it is. It’s simple to register your business with BIR, whether you’re working alone or with personnel to help you get things done.
Here is a detailed explanation of how to accomplish it.
What is BIR?
The Department of Finance is connected to the Bureau of Internal Revenue, or BIR. Calculate and collect national internal revenue fees, taxes, and other charges are the responsibility of this agency.
Additionally, this organization is in responsible of carrying out any fines, forfeitures, or penalties, as well as enforcing court orders that are favorable to it. In the Philippines, this organization is in charge of all financial, monetary, and taxes policies.
These are all intended to increase and enhance Filipinos’ quality of life.
Why must I register my business with the BIR?
If you register your business with BIR, you’ll be able to:
- Register your Tax Identification Number, or TIN, that you supplied when you registered with the SEC.
- Allow you to print official invoices and receipts
- Register your official business transaction record for the fiscal year, which is your set of books of accounts, with BIR as needed each year.
The sorts of taxes you must pay are listed on your BIR Certificate of Registration (BIR FORM 2303) and include:
- Added-value tax
- Tax withholding
- Tax on corporate income
Please read: Selecting a Philippine City to Launch a Business
Benefits of Business Registration in the Philippines
Why should you bother to register your business with the BIR at all? The explanations are listed below.
It establishes your company’s legitimacy
You will formally become the proprietor of your company once it has been registered. By registering your company with BIR, you will also receive an official record of your company’s transactions, proving that you are a tax-paying business owner.
It fosters trust among all parties involved, including clients, suppliers, and staff
A company that is registered with the BIR will have a respectable reputation that will increase client trust. Additionally, your company will gain the trust of both employees and suppliers.
You can stay clear of legal issues
By registering your firm, you’ll be out of trouble with the government for any offences, including tax evasion and tax fraud, providing you provide appropriate documents.
Additionally, doing this can spare you from consequences like fines associated to running a business without a BIR registration.
It aids in comprehensive brand marketing
You’re already one step ahead of your rivals by registering your company with the BIR. It benefits you by allowing you to promote your brand.
It also permits you to expand your firm as you grow to other cities and provinces across the country. You’ll have to worry about being restricted since you’re afraid of getting caught if you don’t have a BIR registration.
You can transact with other companies
Businesses, especially big corporations, won’t do business with people who don’t follow the laws put forth by the government.
Make sure your business is registered and compliant with the law if you wish to engage with bigger corporations.
You can restrict personal liability
Your business will become a distinct legal entity once you register it. As a result, even if you suffer losses and debts, you can still protect your own assets.
Your name won’t be associated with any debts owed by your business.
You can offer products/services online
Your business can change in ways you never imagined conceivable as a result of online sales. Among other legal paperwork, you must submit a BIR registration if you intend to sell on Shopee or Lazada.
You can use it to raise money
Looking for an investor or need a loan for your company? Banks and investors, among other formal lenders, require a BIR registration to prove that you’re a legitimate business.
Additionally, you must have this document in order to be eligible for any type of government help, particularly during times of national emergency like a pandemic.
How to Register a Business in BIR Walk-in (Step-by-Step Guide)
To register your business at any BIR office, follow these procedures.
- Complete all your prerequisites (mentioned above), and visit any Regional or District BIR office.
- Get a queue number in the New Business Registrant lane.
- Apply for a transfer of registration, if necessary. Only those who already have a TIN and are not registered with the current regional or district office are affected by this.
- Make the registration payment.
- Get your Certificate of Registration, Application for Authority to Print Receipts & Invoices, and “Ask for Receipt” notice once it has been approved. This process could take a day, depending on the officers’ availability.
- Attend a taxpayers’ initial briefing. You must attend this upcoming free session in order to understand your obligations, rights, and duties as a business owner.
How to Register a Business in BIR Online (Step-by-Step Guide)
You can register your business with BIR without ever leaving your home (at least not until you claim your Certificate of Registration). Here’s how to register your business online at BIR.
- Make an electronic copy of your documents and download the required forms. Remember that all files must be in PDF format and cannot be larger than 4MB.
- To determine your filing and payment requirements, download the tax-style questionnaire here and complete it.
- Use one of the online payment methods given here to pay the cost.
- Find the email address for your RDO on the NewBizReg website. To do this, provide your company’s address. The appropriate subject line format for your email as well as the RDO information will be shown at the bottom.
- Send the files to your RDO through email. To prevent your email from being classified as spam, make sure to include content in the email body. Soon after your application is received, you’ll get a confirmation email. The BIR employees and officers will manually process this. After three working days, anticipate a response from them.
- Once finished, BIR will contact you with information about your registration. Your appointment time to pick up your Certificate of Registration is included in the email. Once you pick this up, your registration is complete.
Conclusion
Are you preparing to launch and open your own company? If so, registering with the BIR, or Bureau of Internal Revenue, is something you must do when starting a business. Since you’ll need to produce a number of requirements and certifications, the process may be hard, challenging, and taxing. If you decide to take this path, make sure you’re prepared to invest a lot of time and energy.
To prevent making expensive mistakes, it’s critical for you to plan ahead, conduct research, stay informed, and be ready. You can experience a smooth registration process with the Bureau of Internal Revenue if you stay educated and bring the proper paperwork and documents.
Since an alternative, you can look for accounting services in the Philippines as some companies offer assistance with business registration.
