How to Register Online Business in the Philippine BIR and DTI?

Since the Covid-19 crisis, the Philippine eCommerce market has changed as more Filipinos use online selling and vlogging to supplement thei...

Since the Covid-19 crisis, the Philippine eCommerce market has changed as more Filipinos use online selling and vlogging to supplement their income.

Customers are more likely to make online purchases from your firm, regardless of its size or nature, if you have a government license to conduct business.

Additionally, you avoid problems with law enforcement who may query the nature of your firm.

We'll walk you through the process of registering an online business in the Philippines in 2023 in detail in this blog post.

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

Anyone conducting business or making money in any way, including those who sell goods or services online, is needed to be registered with BIR, according to Revenue Memorandum Circular No. 60-2020.

DTI and BIR did grant an exception to people who sell goods "sporadically or irregularly." This covers people who make a living selling handmade goods. Since the agency does not classify those online vendors as businesses, they are exempt from registration requirements.

Register for a Barangay Business Clearance

Prepare the required materials:

• ADTI registration certificate
• Two genuine IDs
• Evidence of Address

1. Go to the barangay center where your business is located and fill out the application while submitting the necessary paperwork.
2. Take advantage of your barangay business clearance by paying the necessary costs.

Register for a Mayor’s Permit

Prepare the required materials:

• Approval for barangay businesses
• A DTI registration certificate
• Two genuine IDs

1. Contract of Lease or Land Title Certificate (whether rented or owned)
2. Fill out the application and provide the criteria to the city or municipal building where your business is located.
3. Get your mayor's permit by paying the required costs.

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

It is crucial to remember that before registering with the BIR, especially if you're a sole proprietor, you must first register your online business name.

Here is a step-by-step guide to registering your domain name with the DTI:

1. Choose a name for your online business.
2. On their website, confirm whether it is available.
3. Fill out the online registration form if it is accessible. You will need the reference code that will be given to you throughout the transaction, so keep it in mind.
4. Within seven business days of the application date, pay the registration cost (barangay P200, city/municipality P500, regional P1000). 
5. Your online company name will be successfully registered once your payment has been confirmed, and you may receive a certificate as confirmation of registration.

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

You must go to the closest BIR Regional District Office (RDO) to register your firm, even if it operates online. Your RDO code is dependent on your base of operations, such as your residential or commercial address.

You can use this online resource to find your RDO code if you're unsure of where it is.

Arrive early to avoid crowds and lines because registration typically takes a day to complete.

A step-by-step tutorial for registering your online business with the BIR is provided below:

1. When you get to the RDO, present your paperwork at the counter for new business registrants.
2. The CSO (Civil Society Organization) will then interview you to ascertain the suitable tax type so they may encode and generate your business TIN (Tax Identification Number).
3. The amended BIR FORM 1901 and your TIN will then be sent to you.
4. When making a payment, turn in the BIR FORM 0605 (Payment Form) and BIR FORM 2000 (Documentary Stamp Tax on Lease). This can be prepared in advance.
5. Proceed to pay the PHP500.00 annual registration fee and, if necessary, acquire a printed receipt or invoice from the BIR.
6. The Certificate of Registration will be connected with a Documentary Stamp that costs PHP30.00 and an extra Certification Fee of P100.00.
7. The Registration Head needs to see your evidence of payment before they can evaluate your application.

The generation of your Certificate of Registration and Authority to Print may take 3-5 days.

The next step is to buy a books of account to maintain an original record of ALL your business dealings. Depending on what works best for you, it can be written by hand, printed, or digital.

Along with a BIR Form 1905, this needs to be recorded at the same RDO where you registered.

Send your COR and ATP to a BIR printer that has been approved after you receive them. It can take up to two weeks for your formal invoices to be released.

You should be aware that you must register as self-employed with SSS, Philhealth, and HDMF if you make more than PHP1,000. Additionally, if you employ people, be sure to register them with the SSS, Philhealth, HDMF, and BIR (for those without TINs yet).

Regardless of whether the firm has started operating or not, once registered with the BIR, you should always file and pay your taxes on time to avoid penalties.

Final Thoughts

Make sure you have a license and are registered with the government before starting a business. To go above and beyond, consider attending taxpayer seminars to learn more about how crucial compliance is to the expansion of your online store. 

This gives your clients the assurance that they are dealing with a trustworthy firm and shields you from future problems with the law.

Has your online business been registered? Please share your experience in the comments box below; we'd love to hear from you.