I was going through some of my old business documents when I stumbled upon the incorporation papers of a failed company I put up around four years ago.
It was nostalgic to remember the fun, the hard work and even the headaches I experienced in making this start-up work. But I guess it was not meant to be at that time.
In any case, while sorting through the papers, I remembered how clueless I was back then on the procedures for registering a corporation. At that time, my experience was just limited to putting up sole proprietorship businesses and that opportunity sort of “showed me the ropes” on how to start a company – something which I’m sharing with you today.
So if you’re planning to start a corporation, or thinking of upgrading your business structure to one, then here’s a simple guide on how to register a corporation in the Philippines.
Step 1: Verify the availability of the company name
Done with the Securities and Exchange Commission (SEC). Takes 1 day to complete. Once verified and approved, you will pay P40 to have the name reserved for a month. You must then file the application for incorporation to the SEC within one month or pay another P40 to extend the deadline for another month.
Step 2: Obtain a bank certificate of deposit for the paid-in capital
Done at the bank. Takes 1 day to complete. Fees vary from bank to bank.
Step 3: Prepare and register incorporation papers
Done with the SEC. Takes at least 3 days to complete. Fees will add up to around P3,000. You need to submit the verification slip (from Step 1), bank certificate of deposit (from Step 2), articles of incorporation and by-laws, treasurer’s affidavit and many other documents. Forms and check list available at the SEC.
Step 4: Obtain a company Community Tax Certificate (CTC)
Obtained at the barangay office or city hall. Takes only 1 day. Fee will be P500 minimum.
Step 5: Apply for a Barangay or District clearance
Done with the barangay office. Takes 2 days. Fees will be around P1,000.
Step 6: Obtain a mayor’s business permit
Done at the City Hall Business Licensing Office. Takes around 2 weeks to complete. Your biggest expense in terms of fees as it will depend on your declared capital. Prepare at least P10,000. Aside from documents obtained in the previous step, you will be required to file other forms and requirements. Ask the licensing office for the check list.
Step 7: Register for taxes
Done at the Bureau of Internal Revenue (BIR) office. Takes around 4 days. Registration fees may add up to around P750 plus additional fees for documentary stamp taxes which depends on your declared capital. You will obtain your company Tax Identification Number (TIN), authority to print receipt/invoices and other documents.
Step 8: Buy accounting books
Buy from any bookstore. Takes 1 day. You’ll be spending around P500 for a cash receipts account, a disbursements account, a ledger and the general journal. Consult your local BIR office for specific requirements on the books.
Step 9: Print your receipts
Done with any print shop accredited by the BIR. Takes around 1 week. Fees vary but it’s usually around P5,000 for 25 booklets.
Step 10: Have your receipts and books stamped
Done at the BIR office. Takes 1 day at no cost. At this point, you can now legally operate your business.
Step 11: Register your employees
Done at various offices. Takes around 2 weeks to process everything. As required by law, you will need to enroll your employees (which may include yourself) with the Social Security System (SSS), Department of Labor and Employment (DOLE), Home Development Mutual Fund (HDMF) and Philippine Health Insurance Corp. (PhilHealth).
This step-by-step guide is just a simplified summary and other steps may be required, specially for businesses which require special permits and clearances (ie, real estate, pawnshops, schools, etc.).
For a comprehensive list of the additional licenses, you may check out the article: How To Register Your Business in the Philippines.
Lastly, the filing duration and fees mentioned are based from personal experience. If you’ve recently registered a corporation in the country and have a different experience than what I’ve written above, then please share it below as a comment so I may add it here. Thank you.
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