How to Comply With Business Licensing Requirements for Online Businesses in the Philippines

Operating online is a great low cost way to get started with your own business.

However, the ethereal nature of the Internet does not absolve you from the responsibility of acquiring a business license–and paying taxes.

There are many benefits to securing the proper seals and documentation though, such as the shine of legitimacy that comes with issuing an official receipt—which is invaluable help in standing out in the crowded digital marketplace–as well as assuring potential customers that you aren’t running some fly-by-night operation.

The first step is registering your business name with the DTI, a process that can be conveniently done online.
  1. The second step is securing a mayor’s permit/business permit from your local city hall, where you will need the following:
  2. Barangay Business Clearance
  3. DTI Business Name Certificate Title or tax declaration (if place of business is owned) Contract of lease (if place of business rented)
  4. Location Clearance
  5. Authorization letter & ID of the owner
  6. Other pertinent documents such as fire and sanitary permits if needed
With those out of the way, it’s finally time to approach the Revenue District Office of the BIR with jurisdiction over your area.

You must accomplish the BIR Form 1901, as well as one addition to the two previous documents:
  1. Birth certificate
  2. Business permit/mayor’s permit
  3. DTI certificate.
Pay the registration fee at an authorized bank of the RDO, and you will get a Certificate of Registration from the BIR.

You then have to complete BIR Form 1906 or Authority to Print (ATP) invoices/ receipts and register books of accounts for use in business. Together, those two documents give you the ability to issue invoices and receipts for every business transaction.

You will also have to contend with giving the government their share, but the benefits of keeping everything on the straight and narrow will give both you and your customers peace of mind.

If you’ve already got your hands full preparing to kickstart your online presence, then these tried and tested business licensing services could be just what you need.

Always remember that you need this in order to prevent any more hassles in your business. After all, the legal way is always the best way.

With everything around us going digital nowadays (yes, including business), don’t forget to register your online shop and manage your business carefully.

About the Author:
Danella Yaptinchay is the managing director of Full Suite, a service company providing back end support to small businesses. She is a cofounder of Co.lab, a coworking space, and of the media company Homegrown. In constant pursuit of balance and self-development, she tries to apply the practices of yoga to her daily life.

*Photo Credit: Official GDC (Creative Commons)