Monday, August 23, 2010

9 Things You Have to Know About Legalizing Your Business (Part 3 of 3)

7. How do you get a business permit from your local (city) government?

If you're thinking of setting up shop in Quezon City, then you're in luck. The local government has just introduced the BOSS (Business One Stop Shop) business registration system: whereas the old system and those used by other local governments often involve around 12 steps that take at least 18 days, BOSS has been simplified into 3 steps that can take as short as 24 hours. The new system also involves less paperwork, less visits to a fewer number of offices, and a greatly reduced number of interactions between the applicant and city government employees.

To register your business in Quezon City, prepare the following documents:
The 3 "easy" steps are:
  1. "Apply" - fill up and submit the registration form together with the requirements listed above
  2. "Pay" - pay inspection, zoning, and annual business permit fees
  3. "Get Permit" - as early the same day

8. How do you register your business with the BIR?

To get a Tax Identification Number for your business and be able to issue receipts, you'll have to register it with the BIR.

Prepare the following documents for submission:
  • Filled-up BIR Application for Registration Form No. 1903
  • The relevant national-level registration certificate of your business: the Business Name Registration Certificate from DTI for sole proprietorships, or the Certificate of Incorporation from the SEC for partnerships and corporations
  • Business Permit from the Local (City) Government
  • Submit all required documents to the Revenue District Office (RDO) having jurisdiction over the registered address of your business
  • Pay the Annual Registration Fee (500 pesos) at one of the Authorized Agent Banks of the RDO
  • Pay 15 pesos for the Certification Fee and another 15 pesos for the Documentary Stamp Tax
  • Get your business' Certificate of Registration (Form 2303)

9. What are the different requirements in maintaining a registered business?

Registering your business and getting your TIN is unfortunately only the first step in legitimizing your business. Regulatory laws require the submission of several other documents and requirements every month, quarter, and year.
  • Monthly requirements
    • Monthly Value Added Tax (VAT) Declaration (Form No. 2550M)
    • Social Security System (SSS) contributions
    • PhilHealth contributions
    • Pag-Ibig contributions  
  • Quarterly requirement
    • Quarterly VAT (Form No. 2550Q)
  • Annual requirements
    • Income Tax Return (Form No. 1702)
    • Registration of books to BIR
    • Financial statements to SEC
    • General information sheet to SEC
    • Renewal of Mayor's/Business Permit
So that's it: 9 things that you need to do to make (and keep) your business legit. But remember that it does not end there: a legal business does not necessarily mean a successful business. You still have to get funding for equipment, materials, and operating expenses, make sure you have a good product, and let your market know your product exists. But at least if all of your papers are in order, you can sleep more soundly knowing that no government spook can come after you and that the reputation of your business is intact.

Click here for Part 1. 
Click here for Part 2.

This series is based on the presentation of J. Sedfrey S. Santiago, Esq. of the John Gokongwei School of Management, Ateneo de Manila University on July 28, 2010.
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