How to Register Your Online Business in BIR and DTI?

The Philippine eCommerce space has since evolved after the Covid-19 crisis as more Filipinos have turned to online selling and vlogging to earn more money.

When you start a business, no matter what size or type, customers are more confident in making online purchases when you are licensed to operate by the government.

Not only that, you save yourself from headaches with law enforcement that question the nature of your business.

In this blog post, we’ll walk you through a step-by-step process on how to register an online business in the Philippines this 2022.

Do I need to register my online business in the Philippines?

According to the Revenue Memorandum Circular No. 60-2020, anyone doing business or earning income in any manner or form, including those that make money online, or sell products or services, is required to be registered with BIR.

However, DTI and BIR made an exemption for those selling products “intermittently or irregularly”. This includes those selling homemade items as a hobby. Those types of online sellers are not considered a business by the department so they don’t need to register.

Register for a Barangay Business Clearance

1. Prepare the necessary requirements:
   1. Certificate of registration from DTI
   2. Two valid IDs
   3. Proof of Address
2. Go and submit the requirements to the barangay center where your business is located and fill up the application form.
3. Pay the corresponding fees and claim your Barangay Business Clearance.

Register for a Mayor’s Permit

1. Prepare the necessary requirements:
   1. Barangay business clearance
   2. Certificate of registration from DTI
   3. Two valid IDs
   4. Contract of Lease or Certificate of Land Title (if either rented or owned)
2. Go and submit the requirements to the city or municipal hall where your business is located and fill up the application.
3. Pay the necessary fees and claim your Mayor’s Permit.

You can check out our full guide here on how to get a business permit.

Register your Business Name in the Department of Trade and Industry (DTI)

It is important to note that you have to register your online business name first, especially if you’re a single proprietor before you register with the BIR.

Here’s a step-by-step process on how to register your online business name in the DTI:

1. Prepare your online business name.
2. Confirm its availability on their website.
3. If it’s available, fill up the online registration form. Remember the reference code that will be provided to you as you will use it throughout the transaction.
4. Pay the registration fee (Barangay-P200, City/Municipality-P500, Regional-P1000) within 7 business days from the application date. 
5. Once your payment has been confirmed, your online business name will be successfully registered and you can download a certificate as proof of registration.

Register your Business with the Bureau of Internal Revenue (BIR)

Even if your business is online, you have to go and register your business at the nearest BIR Regional District Office (RDO). Your RDO code depends on where you are based, like your home or business address.

If you’re not sure where your RDO code is you can check out this online source to help you out.

Registering usually takes a day to process, so make sure to arrive early to avoid crowds and long lines.

Here’s a step-by-step guide on how to register your online business with the BIR:

1. Once you arrive at the RDO, submit your documents to the New Business Registrant Counter.
2. From there, you will be interviewed by the CSO (Civil Society Organization) to determine your applicable tax type, so they can encode and generate your business TIN (Tax Identification Number).
3. You will then receive your TIN and copy of the updated BIR FORM 1901.
4. Submit the BIR FORM 0605 (Payment Form) and BIR FORM 2000 (Documentary Stamp Tax on Lease) when making a payment. You can prepare this in advance.
5. Proceed to pay the Annual Registration Fee of PHP500.00 and request for BIR Printed Receipt/Invoice, if needed.
6. There is an additional Certification Fee of PHP100.00 and PHP30.00 for the Documentary Stamp which will be attached to the Certificate of Registration.
7. Present your proof of payment to the Registration Head, so they can review your application process.

Keep in mind that it may take 3-5 days to generate your Certificate of Registration and Authority to Print.

You can then go ahead and purchase a Books of Account to keep an original record of ALL your business transactions. It can be handwritten, printed, or digital, depending on what works for you.

This needs to be registered in the same RDO where you registered, together with a BIR Form 1905.

After you get your COR and ATP, submit them to an accredited BIR printer. The release of your official invoices usually takes up to 2 weeks.

You have to take note that if you earn more than PHP1,000.00, you are required to register with SSS, Philhealth, and HDMF as self-employed. And if you have employees, make sure to register them with SSS, Philhealth, HDMF, and BIR (for those that do not have TIN yet).

Once registered with the BIR, always file and pay your taxes on time, regardless of whether the business has begun its operations or not, to avoid penalties.

Final Thoughts

When starting a business, it’s important to make sure you are licensed and registered with the government. You can also go the extra mile and attend taxpayer seminars to learn more about the importance of compliance for growing your online business. 

This gives your customers confidence that they are doing business with a legitimate company and also protects you from any headaches with law enforcement down the road.

Have you registered your online business? We’ll be happy to read about your experience in the comments section below.

Related articles:

• Business Loan in the Philippines
• Find Investors for Your Online Business
• How to Get a Business Permit

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