BUSINESS REGISTRATION IN THE PHILIPPINES
Setting up a business in the Philippines involves numerous processes and requirements, and one of them is business registration. Business registration is a requirement for offshore companies, SME’s, startups, multinationals, and business owners in general. If you are a business owner of any of the companies stated, this guide might be helpful for you.
Why Business Registration is Essential in the Philippines
Business registration in the Philippines is an essential legal document that companies must possess before operating. It is essential because it complies with the Republic Act 3883, also known as the Business Name Law. The law states that using any business name that is not registered in the Department of Trade and Industry (DTI) is illegal.
It also states that a business name registration allows business owners to legally and solely use it within its validity period, which is renewable every five years. However, having a business registration under DTI does not mean that you can already run your business. Other requirements, such as business permits and other legal documents from government agencies, are essential.
Why Offshore Companies Need to Get Business Registration
The Philippines is one of the top destinations for offshore companies. However, just like other domestic companies, they also need to comply with the business laws in the country. Without a business registration, any offshore company cannot operate in the Philippines. Proceeding with the operations illegally will incur harsh penalties and risks.
There are three ways on how an offshore company can set up its business in the Philippines.
1. Hire a company that provides recruitment and staff leasing. Having an offshore company in other countries means that you will need new employees. Companies, such as KMC Solutions, provide recruitment and staff leasing for businesses of all sizes that require full-time English-speaking employees in the Philippines.
2. Investing in a seat-leasing deal. A seat-leasing deal is where you can pay someone to manage the staff and the payroll arrangements.
3. Completing the process yourself. If you don’t want to hire a BPO company or invest in a seat-leasing deal, you can DIY it. It means that you will do everything from the paperwork to setting up your business.
How KMC Offers Business Registration Services in the Philippines
Are you struggling in setting up your business? Worry not because there are companies that offer business registration services in the Philippines. KMC Solutions recruits and hires employees to build dedicated TEAMS in the Philippines. KMC handles company processes, such as HR & payroll, tax contributions, and administration. They also offer business registration services to help set up businesses in the country, especially those with headquarters abroad.
How Business Registration Works in the Philippines
Business registration in the Philippines gives your company benefits, which are:
Tax Returns Act As Proof Of Income
Tax returns certify your ability to pay, and they serve as proof that your business is regularly earning.
Business Registration Secures Reputation
Business registration signifies that you are a legitimate business, which secures your reputation in the industry and country.
Benefits, Penalties and Risks
Government Benefits
The government supports businesses by providing free seminars and briefings to let business owners know more information about the company and industry.
Avoiding Unnecessary Penalties and Risks
Failure to register your business and accomplishing legal documents will incur high penalties. Aside from the fines, having an unregistered company will also give you a risk of getting jail time.
This infographic contains the government agencies with specific documents that you need to accomplish to set up a business. It will help you know where to search for the essential documents that you need.
Guided by the infographic above, here are the steps to file a business registration in the Philippines.
Choose your business structure
Your business structure depends on your ability to pay taxes and produce capital. Your business can either be a sole proprietorship, a one-person corporation, a domestic corporation, a general partnership, or other classifications. Your business structure is essential when you file your application.
Infographic made by Kittelson & Carpo Consulting.
Register your business name
The DTI business registration is essential for your business name; however, you may skip this step for those who are freelancers. For corporations and partnerships, you will register with the SEC instead of DTI. For those who want to file an application, you can utilize the online services to contact DTI.
Certificate of Registration from the BIR
All businesses in the Philippines are required to apply for a certificate of registration with the BIR. It enables taxpayers to pay their taxes and enjoy the benefits of having a legal business. Similar to DTI, you can inquire about how to apply online as well.
Apply for a business permit from the LGU
Another business permit that you may need is the mayor’s permit, from the local government unit (LGU). For the mayor’s permit, it is usually submitted to the city hall physically or not online. Before you can start your business, the LGU will check your location and be assessed by the local fire department.
For additional requirements, such as SSS, PhilHealth, and PagIBIG, you can search their respective websites to know how you can file your application. Some government agencies already have online business registration Philippines to make the process more efficient. You can also contact them for more information.
Business Registration Requirements
For those searching on how to start a business in the Philippines, you need to accomplish this list of requirements.
Business Registration
Companies in the Philippines have different classifications, which are:
- Foreign branches
- Foreign representative offices
- 100% foreign-owned domestic corporation
- 60/40 owned domestic corporation
- Partnership
- Sole proprietorship
Office Address
An office address is essential information in processing many, if not all, business documents. Thus, you must have an office space in the Philippines before you can start your business.
Searching for a good office location can be difficult. Factors such as accessibility, parking, and traffic are significant in making your business successful.
Are you looking for an office address? KMC Solutions have something to offer for your business. KMC Solutions offers ready-to-use virtual office addresses in the Philippines. The locations are in business districts like BGC, Makati, Ortigas, Mandaluyong, Clark, and Cebu.
You can use the online or virtual office address to start your business in the country, then transfer to a physical space once you are ready. Their business addresses can be used for registration purposes if you chose a higher virtual office (VO) package.
They offer several packages where the starter only costs PHP 3,000 per month. The package states the following inclusions:
- Use of business address (not for registration purposes)
- SMS or Email notification
- Use of Hotdesk/Proworking for one pax
- Free access to meeting rooms
- Complimentary Water/tea/coffee
- Access to other site locations
Check out our website for more information.
Next Step: Setting Up Your Business
After accomplishing all the necessary documents, setting up your business is the next step. Here, you will need to prepare your company to run its operations by hiring employees, having an HR and payroll arrangement, and other administrative tasks. However, asking for help will enable you to focus on the core processes of your business.
As stated earlier, KMC Solutions does not just help you with your business registration. We also offer services, such as staff leasing, recruitment, HR and payroll, and admin work. In terms of staff leasing and recruitment, KMC Solutions can provide your company English-speaking skilled college graduates. KMC Solutions will support your team by assisting you with other responsibilities and allowing you to use their facilities.
Contact us now through this link to kick-start your entrepreneur journey!
We work with over 400+ businesses across multiple industries with diverse size and staff requirements
