Starting an IT business in the Philippines is an exciting idea that makes you look forward to the opportunities that will come. Many investors have come to this lively place because it has a growing economy, a growing service industry, a vibrant culture, and a good climate.
How to start your IT business in the Philippines
In the Philippines, starting an IT business takes many steps, which can take a lot of time. Here are some of the possible steps in the process:
Look for your name and sign up for it
The first step is to make sure that the name you want for your business is available. You can search for a name for your business on the Business Name Registration Site by giving a priority list of three names. If your first choice has already been taken by another business, you can try the next two names on the list.
After you pay the fees and your name choice is approved, you will get a certificate that is good for five years.
Fill out an application to form a company
You will need to send the Securities and Exchange Commission a number of forms and other proof. Depending on what kind of business you are starting, you may need different kinds of paperwork. For a sole proprietorship, for example, you will send in:
- The form for registering a business name.
- Your passport or a special investor residence visa with a passport photo attached.
- Proof of at least one payment.
The business has to pay the necessary fees and show proof that it did so. Then, there is a waiting period so that the necessary documents, such as the incorporation certificate and supporting documents, can be put together.
After the SEC gives its approval, the business gets a Taxpayer Identification Number.
But the business still has to register with the Bureau of Internal Revenue to find out what taxes it will have to pay, pay an annual fee to register, and get permission to print invoices and receipts. You are responsible for paying taxes on your business and making sure that your employees’ paychecks are properly taxed.
Pay the fee
After the business applies to become a company, the SEC will send out payment fees. The fees for approving the name and registering it must be paid at a bank and proof of payment must be sent to the online system.
The following fees will have to be paid by most businesses:
- The fee to check the name is PHP 100.
- PHP 1,000 is needed to register the bylaws.
- New corporations must pay 150 PHP plus 320 PHP to register stock and transfer stock.
- A fee to file.
- The legal research fee for the bylaws is 1% of the filing fee, but it can’t be less than PHP 10.
Sign up with other organizations
The business will probably have to register with other government agencies, like the Social Security System and the Home Development Mutual Fund. You might also have to register your business with the Department of Trade and Industry and the local Barangay Office. You must sign up with the Philippine Health Insurance Corporation if you have employees. You have to put a set amount of money for each of your employees into a health insurance fund. This fund is then used to help the employee if they get hurt or sick.
Obtain your business permit
You might also need to get a business license from the local government. Most of the time, you’ll have to pay to get a business license. 2% of the authorized capital stock’s value.
Obtain Barangay clearance
At the Barangay where your business is located, you need to get a clearance and pay the annual community tax. To get your clearance, send in the following:
- Fill out the SEC form Certificate of Incorporation, and Bylaws that have been approved.
- Location plan or site map for your office and the lease.
- Pay the fee, which in Quezon City is between PHP 300 and PHP 1,000.
