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Starting a Business in Philippines
 
 
 

Corporation

Procedure 1. Obtain bank certificate of deposit of the paid-in capital

Time to complete:
1 day

Cost to complete:
No charge

Comment:
Fees vary from bank to bank. Some banks in Manila do not charge any fee, but others charge up to P105 for each certificate.

Procedure 2. Verify the availability of the company name with the Securities and Exchange Commission (SEC)

Time to complete:
1 day

Cost to complete:
P40

Comment:
The availability of the proposed company name can be verified via the SEC's online verification system at no charge. However, the SEC charges P40/month upon official reservation of the company name. Within the reserved period, the company must file its application for incorporation. In the event that the reservation period expires without the company filing its application for incorporation, such reservation must be renewed/extended by paying P40/month failure of which will prevent the company from using such reserved name.

Procedure 3. Register incorporation with the Securities and Exchange Commission

Time to complete:
3 days

Cost to complete:
Filing fee for articles of incorporation P1,000 +issuance fees P1,000+ P510 bylaws fee + P470 - stock and transfer book registration fee + P75 - membership book registration fee

Comment:
To register an incorporated company with the Securities and Exchange Commission (SEC), the promoters must file the following documents: the corporate name verification slip; the articles of incorporation and by-laws; the treasurer's affidavit; the bank certificate of deposit; the authority to verify the bank account; the incorporator’s tax identification number; affidavit of incorporator or director undertaking to change corporate name , officers, stockholders, and so forth.

Through SEC i-Register, the SEC provides a web-based, online company registration system and the option to reserve a company name. Although registration forms may now be downloaded from the SEC website, the registration papers must be filed and the filing fee paid at the SEC office. Applications are submitted for pre-processing evaluation prior to filing.

Whereas the company now obtains a temporary identification number (TIN), in the past, the company obtained the TIN from the Revenue District Office. To obtain the TIN, the company requires a Barangay (district) clearance, a mayor's permit, and a copy of the SEC-issued registration certificate (issued as part of this procedure). Other documents may be required (e.g. homeowner’s clearance, lease contract).

As authorised by the Bureau of Internal Revenue (BIR), the SEC now issues pre-generated TINs only if a company’s application for registration or incorporation has been approved. Although the SEC issues the TIN, the company must still register with the BIR: this time, to identify applicable tax types, to pay an annual registration fee, to register and stamp the books of accounts, and to obtain sales invoices and receipts.

Procedure 4. Obtain community tax certificate (CTC)

Time to complete:
1 day

Cost to complete:
P500

Comment:
To obtain a Barangay clearance, a company must obtain a community tax certificate. The company is assessed a basic and an additional community tax. The basic community tax rate depends on whether the company legal form is a corporation, partnership, or association (P500 or lower). The additional community tax (not to exceed P10,000) depends on the assessed value of real property the company owns in the Philippines at the rate of P2 for every P5,000 and on its gross receipts, including dividends or earnings, derived from business activities in the Philippines during the preceding year, at the rate of P2 for every P5,000.


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