With towering buildings, wide paved roads complete with equally wide tree-lined sidewalks, the Taguig City everyone knows is not the only Taguig that there is. Rather, Bonifacio Global City, which has become the most popular landmark of Taguig, is but a small piece of the thriving city.
Nonetheless, wherever you may plan to put up your business in Taguig, it only takes 16 steps to get it started. As is expected in a commercially active city, starting a business in Taguig is quite expensive, with an estimated average cost equivalent to 23.2 percent of income per capita.
Based on the 2011 Doing Business in the Philippines study of the International Finance Corporation, here are the 16 steps to start your business in Taguig.
Step 1. Verify and reserve the company name with the Securities and Exchange Commission (SEC)
The company can verify the availability of the company name online. Verification is free but reservation of the name, once approved by the SEC, costs PHP 40 for the first 30 days. The company name can be reserved for a maximum of 120 days for a fee of P120, which is renewable upon expiration of the period.
Step 2. Deposit paid-up capital in the authorized agent bank (AAB) and obtain bank certificate of deposit
The company is required by law to deposit paid-up capital amounting to at least 6.25% of the authorized capital stock of the corporation. This paid-up capital must not be less than P5,000.
Some banks charge a fee for issuance of the certificate of deposit.
Step 3. Notarize articles of incorporation and treasurer\\\'s affidavit at the notary
According to Sections 14 and 15 of the Corporation Code, articles of incorporation should be notarized before filing with the SEC.
Step 4. Register the company with the SEC and receive pre-registered Taxpayer Identification Number (TIN)
The company can register online through SEC i-Register but must pay at the SEC. The following documents are required for SEC registration:
a. Company name verification slip;
b. Articles of incorporation (notarized) and by-laws;
c. Treasurer\\\'s affidavit (notarized);
d. Statement of assets and liabilities;
e. Bank certificate of deposit of the paid-in capital;
f. Authority to verify the bank account;
g. Registration data sheet with particulars on directors, officers, stockholders, and so forth;
h. Written undertaking to comply with SEC reporting requirements (notarized); and
i. Written undertaking to change corporate name (notarized).
The SEC issues pre-registered TINs only if the company’s application for registration has been approved. The company must still register with the Bureau of Internal Revenue (BIR) in order to identify applicable tax types, pay an annual registration fee, obtain and stamp sales invoices, receipts and the books of accounts.
Step 5. Obtain barangay clearance
This clearance is obtained from the barangay where the business is located and is required to obtain the business permit from the city or municipality. Barangay fees vary for each barangay since they have the discretion to impose their own fees and charges for as long as these fees are reasonable and within the limits set by the Local Government Code and city ordinances. Barangay fees may depend on:
a. the location and the area (size in square meters) of the place of business; or
b. the company’s paid-up capital and the area it occupies; or
c. whether they issue clearance plates or certificates.
Step 6. After issuance of the SEC certificate of incorporation, pay the annual community tax and obtain the community tax certificate (CTC) from the City Treasurer\\\'s Office (CTO)
In Taguig, the community tax certificate is not a requirement for obtaining the barangay clearance. The city has passed an ordinance setting a ceiling for barangay clearance fees for all barangays under its jurisdiction.
Step 7. Notarize the business permit application form
Business permit application form is downloadable from the city’s website.
Step 8. Obtain the business permit to operate from the Customer Service Counter of the Business Permits and Licensing Office (BPLO)
The company must file the following documents at the BPLO:
a. SEC registration;
b. Duly notarized application form;
c. Barangay clearance;
d. Corporate community tax (Cedula);
e. Contract of lease;
f. Insurance (comprehensive general liability);
g. Location sketch; and
h. Photocopy of Certificate of Occupancy (obtained from the owner of the building).
Once the documents are filled, the officer at the Customer Service Counter forwards the forms to the following offices: (1) the BPLO for the assessment of fees and tax order of payment; and (2) the Health Department for calculation of sanitary inspection fee.
The city collects initial business tax for the quarter covering the period of business registration. In the succeeding quarter(s), the tax is based on the gross sales for the preceding quarter.
Inspection from the BPLO takes place after issuance of the business permit.
Step 9. Buy special books of account at bookstore
Special books of accounts are required for registering with the BIR. The books of accounts are sold at bookstores nationwide. One set of journals consisting of four books (cash receipts account, disbursements account, ledger, general journal) costs about PHP 400.
If the company has a computerized accounting system (CAS), it may opt to register its CAS under the procedures laid out in BIR Revenue Memorandum Order Nos. 21-2000 and 29-2002. The BIR Computerized System Evaluation Team is required to inspect and evaluate the company’s CAS within 30 days from receipt of the application form (BIR Form No. 1900) and complete documentary requirements.
Step 10. Apply for Certificate of Registration (COR) and TIN at the Bureau of Internal Revenue (BIR)
The company must register each type of internal revenue tax for which it is obligated by filing BIR Form No. 0605 and paying the annual registration fee of PHP 500. Upon registration, the BIR will issue to the company the certificate of registration—BIR Form No. 2303.
To obtain the TIN, the company has to file:
a. Barangay clearance;
b. Mayor\\\'s permit; and
c. Copy of its SEC registration.
For company registrations filed with the SEC Head Office in Metro Manila, the BIR confirms the pre-registered TIN issued by the SEC.
Step 11. Pay the registration fee and documentary stamp taxes (DST) at the AAB
The company must pay DST on the original issuance of shares of stock. The rate is PHP 1 on each PHP 200 or a fractional part thereof, of the par value of such shares of stock. This payment with the BIR should be made on the 5th of the month following registration with the SEC.
The COR will be released only after all the DSTs are paid.
The company must also pay DST on its lease contract at the rate of PHP 3 for the first PHP 2,000 or fractional part thereof, and an additional PHP 1 for every PHP 1,000 or fractional part thereof in excess of the first PHP 2,000 for each year of the lease as stated in the contract.
Step 12. Obtain the authority to print receipts and invoices from the BIR
The authority to print receipts and invoices must be secured before the sales receipts and invoices may be printed. The company can ask any authorized printing company to print its official forms, or it can print its own forms (i.e., it uses its computers to print loose-leaf invoice forms) after obtaining a permit from BIR for this purpose. To obtain the authority to print receipts and invoices from the BIR, the company must submit the following documents to the Revenue District Office (RDO):
a. Duly completed application for authority to print receipts and invoices (BIR Form No. 1906);
b. Job order;
c. Final and clear sample of receipts and invoices (machine-printed);
d. Application for registration (BIR Form No. 1903); and
e. Proof of payment of annual registration fee (BIR Form No. 0605).
Step 13. Print receipts and invoices at the print shops
The cost is based on the following specifications of the official receipt: 1/2 bond paper (8 ½ x 5 ½ cm) in duplicate, black print, carbonless for 10 booklets.
Step 14. Have books of accounts and Printer’s Certificate of Delivery (PCD) stamped by the BIR
After the printing of receipts and invoices, the printer issues a Printer’s Certificate of Delivery of Receipts and Invoices (PCD) to the company, which must submit this to the appropriate BIR RDO (i.e., the RDO which has jurisdiction over the company’s principal place of business) for registration and stamping within thirty (30) days from issuance. The company must also submit the following documents:
a. All required books of accounts;
b. VAT registration certificate;
c. SEC registration;
d. BIR Form W-5;
e. Certified photocopy of the ATP; and
f. Notarized taxpayer-user’s sworn statement enumerating the responsibilities and commitments of the taxpayer-user.
The company must also submit a copy of the PCD to the BIR RDO having jurisdiction over the printer’s principal place of business.
Step 15. Register with the Social Security System (SSS)
To register with the SSS, the company must submit the following documents:
a. Employer registration form (Form R-1);
b. Employment report (Form R-1A);
c. List of employees, specifying their birth dates, positions, monthly salary and date of employment; and
d. Articles of incorporation, by-laws and SEC registration.
Upon submission of the required documents, the SSS employer and employee numbers will be released. The employees may attend an SSS training seminar after registration. SSS prefers that all members go through such training so that each member is aware of their rights and obligations.
Step 16. Register with the Philippine Health Insurance Company (PhilHealth)
To register with PhilHealth, the company must submit the following documents:
a. Employer data record (Form ER1);
b. Report of employee-members (Form ER2);
c. SEC registration;
d. BIR registration; and
e. Copy of business permit.
Upon submission of the required documents, the company shall get the receiving copy of all the forms as proof of membership until PhilHealth releases the employer and employee numbers within three months.
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