How to Maintain Compliance After Business Registration

Registering your business in the Philippines is just the beginning. To ensure your business operates legally and avoids penalties, maintaining compliance with post-registration requirements is essential. Compliance not only protects your business but also fosters trust with clients, investors, and regulatory authorities.

This blog outlines the key steps to staying compliant after registering your business in the Philippines.

1. Secure Your Bureau of Internal Revenue (BIR) Certificate of Registration

Upon registration, all businesses are required to secure a Certificate of Registration (COR) from the Bureau of Internal Revenue (BIR). This document formalizes your tax obligations.

What to Do Post-Registration:

• File Monthly and Annual Tax Returns: Submit income tax, VAT or percentage tax, and other applicable returns on time.
• Issue Official Receipts (ORs): Use BIR-registered receipts or invoices for all transactions.
• Maintain Books of Accounts: Properly record all financial transactions.

Pro Tip: Keep track of BIR deadlines using a compliance calendar to avoid penalties for late filings.

2. Renew Your Business Permits Annually

Barangay Clearance

• Renew your Barangay Clearance at your barangay office at the start of each year.
• Submit your updated Mayor’s Permit and pay the renewal fee.

Mayor’s Permit

• Renew this permit at your city or municipal hall.
• Requirements typically include:
  • Previous Mayor’s Permit
  • Updated BIR registration
  • Proof of payment of local business taxes

3. File Your General Information Sheet (GIS) with the SEC

If your business is a partnership or corporation, you are required to file a General Information Sheet (GIS) with the Securities and Exchange Commission (SEC) annually. This document provides updates on the company’s officers, shareholders, and other pertinent details.

Steps:

1. Prepare and review the GIS.
2. Submit it online through the SEC’s Electronic Filing and Submission Tool (eFAST).
3. File within 30 days of the annual stockholders’ or members’ meeting.

4. Submit Audited Financial Statements (AFS)

Corporations must submit their Audited Financial Statements (AFS) to the SEC annually.

Requirements:

• Prepared by an accredited Certified Public Accountant (CPA).
• Filed within 120 days from the end of the fiscal year.

For sole proprietorships and partnerships, submit your financial statements directly to the BIR.

5. Comply with Employment Laws

If your business employs workers, compliance with labor laws is crucial:

• Register with SSS, PhilHealth, and Pag-IBIG: Remit mandatory contributions monthly.
• Pay the Minimum Wage: Ensure employees receive at least the legal minimum wage in your area.
• Provide Mandatory Benefits: These include 13th-month pay, overtime pay, and leave benefits.

Annual Employer Reports:

• Submit your Employer Remittance Reports to SSS, PhilHealth, and Pag-IBIG.

6. Update Your Business Registration Details

If there are any changes to your business, such as:

• Business address
• Contact details
• Capital structure
• Shareholders or directors (for corporations)

You must update these details with the relevant authorities, such as the DTI, SEC, and BIR.

7. Adhere to Data Privacy Regulations

Businesses that collect personal data from customers must comply with the Data Privacy Act of 2012.

Steps to Ensure Compliance:

• Appoint a Data Protection Officer (DPO).
• Implement a Privacy Management Program.
• Register with the National Privacy Commission (NPC) if processing sensitive personal information.

8. Monitor Industry-Specific Compliance

Certain industries require additional permits or licenses, which must be renewed periodically:

• Real Estate: Renew your License to Sell with the DHSUD.
• Food and Beverage: Renew FDA approvals for your products.
• Logistics: Maintain LTFRB permits for transportation businesses.

9. Pay Annual Business Taxes

Local government units (LGUs) impose an annual business tax based on your gross receipts. Ensure you pay this tax on time to renew your Mayor’s Permit.

Steps:

1. Compute your tax based on gross sales.
2. Submit the required documents to the city or municipal hall.
3. Pay the tax and keep the receipt for record purposes.

10. Stay Informed on Legal Updates

Regulatory requirements can change. Stay informed about updates from:

• BIR: Tax regulations and new forms.
• SEC: Deadlines and reporting requirements.
• LGUs: Changes in local tax rates or policies.

Joining industry groups or hiring a legal or tax advisor can help ensure you remain updated.

Consequences of Non-Compliance

Failing to comply with post-registration requirements can lead to:

• Fines and Penalties: Delayed filings or non-payment of taxes incur significant fees.
• Business Suspension: LGUs or regulatory agencies may suspend your operations.
• Reputational Damage: Customers and partners may lose trust in your business.

Final Thoughts

Maintaining compliance after business registration is a continuous process, but it’s essential for the longevity and growth of your business. By staying organized, adhering to deadlines, and consulting with professionals, you can ensure your business operates legally and efficiently.

If you’re unsure about compliance requirements or need assistance with filing, consider working with a lawyer or business consultant. Compliance is not just about avoiding penalties—it’s about securing the future of your business.

Navigating the business landscape in the Philippines can be both rewarding and intricate. Whether you’re embarking on a new venture or scaling up, ensuring that your corporate endeavors are in line with local regulations is paramount.

At CBOS Business Solutions Inc., we pride ourselves on simplifying these processes for our clients. As a seasoned professional services company, we offer comprehensive assistance with SEC Registration, Visa processing, and a myriad of other essential business requirements. Our team of experts is dedicated to ensuring that your business is compliant, well-established, and ready to thrive in the Philippine market.

Why venture into the complexities of business registration and compliance alone? Allow our team to guide you every step of the way. After all, your success is our commitment.

Get in touch today and let us be your partner in achieving your business goals in the Philippines.

Email Address: gerald.bernardo@cbos.com.ph

Mobile No.: +639270032851

You can also click this link to schedule a meeting.