Do you want to monetize your skills and assets? Now is the time to do it by starting your dream business. Although the pandemic has caused challenges to the working class, it has given opportunities for other forms of livelihood.
Being your own boss is a dream for many. For starters, you have to know the type of business you want to set up. Will it be sole proprietorship or partnership?
Sole proprietorship is a business owned or run by one person while a business partnership consists of two or more individuals running the business. After deciding which type to set up, you are now ready to register your business.
Here are six steps to register a micro, small, and medium enterprise (MSME):
Register the name of your business
1.1. Sole proprietorship
Think of a business name to register either online or over the counter. Registration of business names is available online to make the process more convenient. For over the counter process, get two application forms available at the DTI counter. Fill out the form and submit to the DTI processor. It is advisable to prepare multiple business names just in case there are duplicates.
Pay the business name registration fee, the amount of which depends on the scope of business. Barangay level is Php 200, Php 500 for municipal, Php 1,000 for regional, and Php 2,000 for a business with national scope.
Never forget to bring valid government IDs for validation and verification purposes.
1.2 Business partnership
• Go to the office of Security Exchange Commission (SEC) for registration of name. Partnership based businesses have a different process for name registration.
• Submit name verification slip which can be obtained from the SEC office
• Submit Articles of Partnership which should be notarized by a lawyer.
• If the business partner is a foreign national, submit FIA form 105.
• Pay the registration fee which is 1% of the partnership’s capital.
• Pay for legal research fee which is also 1% of the partnership’s capital.
• Secure treasurer’s affidavit from a bank to authorize SEC and Bangko Sentral ng Pilipinas to verify the funds in your bank account. This is necessary to make sure that the business will thrive.
• If applicable, prepare other government licenses and clearances for businesses that require secondary licenses to operate.
• Lastly, prepare partnership details.
The following requirements apply to both sole proprietorship and partnership:
Get a Barangay Clearance
Once done in the name registration process, get a barangay clearance. This is mandated by the Local Government to make sure that your business meets the standards of the barangay. The barangay clearance fee varies from barangay to barangay.
Register to PhilHealth, SSS, and PagIbig
Regardless if a business has an employee or not, the law mandates that every Filipino whether employed or self-employed must be covered by the government statutory benefits. So make sure to register with the Social Security System (SSS), PhilHealth, and PagIbig Fund.
Get a Mayor’s Permit
After securing statutory benefits registration, secure a business permit from the mayor’s office. This permit serves as proof that the business is compliant with the municipality or city’s ordinances and standards for sanitation and safety. A mayor’s permit fee varies depending on the scope of business.
Register to BIR
For the last step in this process, register the business to the Bureau of Internal Revenue (BIR) to determine taxes and annual registration fee. The BIR certificate also shows trade name, Tax Identification Number (TIN), line of business, and tax to file. BIR registration allows a business to issue official receipts to clients, register a book of account, and get a separate TIN.
Optional requirement: DOLE Permit
If employees will be hired, obtain a permit from the Department of Labor (DOLE) to ensure compliance with the Occupational Safety and Health standards. To register at DOLE, submit three copies of DOLE-BWC-IP-3 registration form to their physical/regional office. Submit also the blue print layout of the workplace showing the physical layout of each floor with fire exits, storage, and emergency equipment.
Once accomplished with all these requirements, your business is good to go!
