Business RegistrationOnline Businesses in the Philippines must Register by Aug 31

July 30, 20200
https://www.tripleiconsulting.com/wp-content/uploads/2013/08/Untitled-4.jpg

As the Philippines government looks to raise revenues to help with its efforts to battle the global pandemic they have taken to the enforcement of all online businesses selling and operating in the Philippines. This is to ensure that proper value added, and sales taxes were added to the purchases as well as ensuring the business owners (online sellers) are declaring this income and paying the appropriate income tax.

While the regulations regarding small businesses have always been in existence, the Bureau of Internal Revenue along with the Department of Finance have decided in the recent past that this will become a main driver of this current administration. All online businesses regardless of size must register with BIR. These include side-line businesses that many Filipinos do to make ends meet or put away some savings for a rainy day.

These sellers must now register themselves as sole proprietorships or one-person corporations, or even domestic corporations with the Securities and Exchange Commission. Then after registration, they must file these new businesses with BIR. It is unclear how long these businesses will take to register and if they can continue operations while this is ongoing.

Initially, the registration of these businesses was required by July 31st but the BIR released Revenue Memorandum 75-2020 on July 29th extending the filing deadline to August 31st. The main reasons cited for the extension were, sellers inability to make it to BIR district offices, fear of face-to-face interaction with BIR staff due to corona, and limited bank operations.

The BIR re-iterated that businesses that earn less than 250,000 Php (~$5,000 USD) are exempt from paying income tax, however, Commissioner Ceasar Dulay had strong words for sellers not planning to register.

“All those who will be found later doing business without the registration … and those who fail to declare past due taxes shall be imposed with applicable penalties under the law, and existing revenue rules and regulations.”

For business or companies that need assistance with registration services in the Philippines or consulting on paying income tax contact info@tripleiconsulting.com to speak to a consultant.

Leave a Reply

Your email address will not be published. Required fields are marked *