Part 2: Business Permit and Other Registrations
In the previous article, we talked about matching the type of business with the appropriate government agency to register to. Today, we will discuss the necessary permits and registrations relating to starting a business.
A. Obtain a Mayor’s or Business Permit All businesses are required to secure a mayor’s permit or business permit from the local government of the city or municipality where the business is located.
Different cities and municipalities have different registration procedures and requirements. The following are the general requirements for securing a permit for a new business:
Application forms
DTI registration or SEC registration, whichever is applicable
Lease contract or title covering the property where the business is located, whichever is applicable
Locational or zoning clearance
Building permit and occupancy permit
Public liability insurance
Barangay clearance
Fire safety certificate
Other requirements specific to the type of business to be carried out
For the specific requirements, one needs to visit the city or municipal hall of the city or municipality where the business will be established.
B. Register with the Bureau of Internal Revenue (BIR) All businesses have to register with the BIR before the commencement of operation for taxation purposes.
The registration process involves obtaining and registering a tax identification number (TIN), obtaining BIR-registered official receipts and invoices, registering the business’s books of accounts, and paying the applicable fees.
The registration must be done at the Revenue District Office (RDO) of the BIR, which covers the registered address of the business.
For the specific requirements for BIR registration, one needs to visit the RDO that covers the registered address of the business.
C. Register with the Social Security System (SSS) All businesses that have employees must be registered with the SSS. The registered employer will be assigned an employer number, which will be used as reference for the remittance of monthly contributions, composed of the employee’s contribution and the employer’s share.
SSS coverage is compulsory for all employees not over sixty years of age and their employers.7
An employer is any person who carries on in the Philippines any trade, business, industry, undertaking, or activity of any kind and uses the services of another person who is under his or its orders as regards the employment. Meanwhile, an employee is any person who performs services for an employer in which either mental or physical efforts or both are used and who receives compensation for such services, where there is an employer‐employee relationship.8
The SSS provides replacement income for employees in times of disability, sickness, maternity, and old age. It also provides assistance during death and for funeral expenses.
D. Register with the Philippine Health Insurance Corporation (PhilHealth) All employers are required to register themselves and their employees with PhilHealth, the government health-care system. Upon registration, an employer shall be issued an employer number.
Under the PhilHealth system, the monthly contribution is divided equally between the employer and the employee. It is deducted and withheld automatically by the employer from the employee’s salary then remitted to PhilHealth.
F. Register with the Home Development Mutual Fund (Pag-IBIG Fund) All employees who are or ought to be covered by the SSS are also covered by mandatory membership in the Pag-IBIG Fund.10 The Pag-IBIG Fund provides various types of housing loans to employees.
Members make their contributions to the Pag-IBIG Fund through salary deduction. The employer has the responsibility to deduct the contribution from the employee’s salary. Together with the employer’s share of the contribution, the employee contribution is remitted to the Pag-IBIG Fund on a monthly basis.
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In the last article of this series, we will summarize the importance of securing legal documents.
Originally published at foundersguide.com
