All About Business Registration with the BIR

The Bureau of Internal Revenue just announced recently that anyone who is earning income, especially those who are earning via electronic means, should be registered with the BIR. They discussed in detail business registration with the BIR in this circular RMC 60-2020.

Part of the list of types of business mentioned by the BIR are the following:

  • businesses earning via electronic means
  • Partner sellers and merchants
  • Payment gateways
  • Delivery channels
  • Internet service Providers
  • and other facilitators

All business owners shall update their business registration document with the BIR and their status no later then July 31, 2020.

Business owners, aside from business registration, are all encouraged to voluntarily declare all past transactions when declared and paid before the said date.

For all newly registered businesses, too, you are also required to have and do the following:

  • Issue Official Receipt or Invoice for every sale
  • Keep registered Books of Accounts and accounting records of business transactions
  • Withhold taxes (if applicable)
  • File required tax returns
  • Pay correct taxes on time

BASIC REGISTRATION GUIDELINES FROM THE BIR

Which RDO should you register with?

In general, register with the RDO in the city where your head office is located or in the city of your residence if you are an individual or self-employed tax payer.

If I don’t have TIN?

You have to get a Tax Identification Number first before registering your business.

What if I have a TIN but I haven’t registered any business yet?

Please register your business using Form 1901 of the BIR in the RDO within the correct city of the place of business.

If you need the list of requirements, feel free to head on over to https://www.taxumo.com/business-registration/ The complete list is there for Individual tax payer (whether you are a Non-Licensed professional like a consultant, freelancer, etc. or a Licensed Professional like a doctor, etc. or a Sole Proprietor like an online seller, etc.)

What are the requirements to get a Certificate of Registration?

How do I know if I am completed business registration with the BIR?

You will know if you are completely registered with the BIR if you have a Certificate of Registration or Form 2303, An Authority to Print form (this is so that you can have ORs and Invoices printed by accredited printers) and stamped books of accounts.

If you are based in these locations, Taxumo offers a service where they can process the registration for you:

  • All parts of Metro Manila
  • Rizal
  • Laguna
  • Cavite
  • Tarlac
  • Batangas

If you have questions, please feel free to reach out to bizreg@taxumo.com.

Hope this helps!

How to Submit BIR Attachments During GCQ

To be honest with you, I really don’t want to leave the house. I’ve been rejecting work from potential clients that require me to go to their physical stores. I really want to help though, but I think to keep everyone safe, it’s my personal choice to stay at home. With the BIR deadline coming up, one of the questions people are asking is how to submit BIR attachments during GCQ (General Community Quarantine).

Yesterday, I saw that BIR came out with RMC 49-2020 (Revenue Memorandum Circular 49-2020). This circular is being issued to provide options to taxpayers in the submission of the filed 2019 Income Tax Return and its required attachments.

So option one is to submit them through Revenue Collection Officers (RCOs). And the new option is to submit online using a facility called eAFS.

How to Submit BIR Attachments via Revenue Collection Officers (RCOs) with payments done via online facility of AABs

A taxpayer should bring all the pertinent documents that he/ she has which are the Annual Income Tax Form, the eBIR or eFPS confirmation and the attachments. Examples of the attachments are all 2307 forms, 2316 form, the SAWT validation, and the AFS (if applicable to your business).

Note also that: “The attachments to the income tax returns shall be stamped only on the page of the Balance Sheet, the Income Statement and Audit Certificate, if applicable. The other pages of the financial statements and its attachments need not be stamped “Received”. In case of corporations and other juridical persons, at least 2 extra copies of the Audited Financial Statements for filing with the Securities and Exchange Commission (SEC) should be stamped “Received” pursuant to Revenue Memorandum Order (RMO) Nos. 6-2010 and 13-2011.” Personally, I just create 4 copies of all sets of documents.

How to Submit BIR Attachments Through eAFS

Any taxpayer, may submit the Filed ITR and its required attachments through the BIR eAFS system. This may be accessed through the BIR website (eAFS icon).

First step is to gather 3 sets of documents and save them as PDF copies. The three sets of documents are: (1) ITR Documents; (2) AFS documents (if applicable; (3) Other documents. I will expound on each below.

ITR Documents

  • For Manually Filed ITRs: lncome Tax Return (BlRForm l7O2 or 77OL)stamped bY AABProof of Payment
  • For Electronically File ITRs: Filing ReferenceNumber/EmailNotification

Note that the file name should be: EAFSXXXXXXXXXITR2019 where: XXXXXXXXX is your 9-digit TIN and 2019 is the taxable year. File size should not exceed 4.8 GB.

AFS Documents (if applicable)

For both Manually and Electronically Filed ITRs, compile these:

  • Certificate of independent CPA duly accredited by the BIR. The CPA certificate is required if the gross annual sales, earnings, receipts or output exceed (3M). 
  • Account information Form (AlF) and/or Financial Statements (FS), including the following schedules prescribed under existing revenue issuances which must form part of the Notes to the audited FS: 
    • Taxes and licenses 
    • Other information prescribed to be disclosed in the notes to FS
  • Statement of Management’s Responsibility (SM R) for Annual income Tax Return

Note that the file name should be: EAFSXXXXXXXXXAFS2019 where: XXXXXXXXX is your 9-digit TIN and 2019 is the taxable year. File size should not exceed 4.8 GB

OTHER ATTACHMENTS

  • Certificate of income Payments not subjected to Withholding Tax (BlR Form No. 2304), if applicable; 
  • Certificate of Creditable Tax Withheld at Source (BlR Form No. 2307) – All 2307s;
  • Duly approved Tax Debit Memo, if applicable; 
  • Withholding Tax Remittance Return on Sale of Real Properties (BlR Form No. 1606) 
  • Proof of prior year’s excess credits, if applicable;
  • Proof of Foreign Tax Credits, if applicable; 
  • For amended return, proof of tax payment and the return previously filed; Report of electronically submitted Summary Alphalist of withholding Agents of income Payments Subjected to withholding Tax at Source (SAWT) thru esubmission@bir.gov.ph, if applicable;
  • Proof of other tax payments/credit, if applicable; 
  • Certificate of Compensation Payment/Tax Withheld (BlR Form No. 2316);
  • Others

Note that the file name should be: EAFSXXXXXXXXXOTH2O19-01 where XXXXXXXXX is your 9-digit TIN and 2019 is the taxable year. “01” will be the first file of other attachments and “02” will be the second file and so on and so forth. File size (per file) should not exceed 4.8 GB.

The eAFS will acknowledge successful submission by issuing a system generated Transaction Reference Number and by sending an email to the system user. This Transaction Reference Number shall serve as the proof of submission by the taxpayer, in lieu of the manual “Received” stamping.

All of us should should keep the original copies of the digitally submitted documents in accordance with Section 203 of the NIRC for the period as prescribed under Revenue Regulations ll-2013. This is just in case the BIR officers need to see it later on, we have a copy.

Here is the link to the RMC 49-2020 on BIR attachments.

https://www.bir.gov.ph/images/bir_files/internal_communications_1/Advisory/posted%20while%20under%20quarantine%20march%202020/RMC%20No.%2049-2020.pdf

Step – by – step guide (Annex to RMC)

P.S. If you are a Taxumo user, like I am, please stay tuned for announcements. 🙂 They will be announcing details about attachments this week.

Hope this helps!