Professional Documents
Culture Documents
CHAPTER 5
LEGAL ASPECT
Legal Requirements
Estimated Estimated
Procedure
Time Cost
1. Verify and reserve the company name with the
1 day 40.00
Securities and Exchange Commission (SEC)
2. Notarize articles of partnership at the notary 1 day 500.00
3. Register the company with the SEC and receive
pre-registered Taxpayer Identification Number
(TIN). The following documents are required for
SEC registration: 3 days 5645.00
Company name verification slip;
Articles of Partnership; and
Statement of assets and liabilities
4. After issuance of the SEC certificate of
incorporation, pay the annual community tax and
1 day 500.00
obtain the community tax certificate (CTC) from
the City Treasurer's Office (CTO).
5. Obtain barangay clearance 1 day 700.00
6. Proceed to the Muntinlupa Business Center (MBC)
to submit application form and requirements; and
obtain endorsement from the Business Permits and
Licensing Office (BPLO) together with the
following requirements:
Barangay clearance; 1 day No Cost
SEC registration;
Authorization letter of owner with ID;
Lease contract/tax declaration;
SSS certification/clearance; and
Community tax certificate.
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To PhilHealth:
Member registration forms for each employee
with the required supporting documents.
Total 32 days 32,855.00
Income tax
Under the National Internal Revenue Code (NIRC), the business is considered as
a partnership, or in NIRC terms, as a corporation. From Section 27 of the NIRC, except
as otherwise provided in this Code, an income tax of thirty percent (30%), effective
January 1, 2009, is hereby imposed upon the taxable income derived during each taxable
year from all sources within and without the Philippines by every corporation. The
business will use a calendar year for tax purposes.
Annual Income Tax Return for Corporations and Partnerships Provisions:
Tax Form:
BIR Form 1702 - Annual Income Tax Return (For Corporations and Partnerships)
Documentary Requirements:
1. Certificate of Income Payments not Subjected to Withholding Tax (BIR Form
2304), if applicable
2. Certificate of Creditable Tax Withheld at Source (BIR Form 2307), if applicable
3. Duly approved Tax Debit Memo, if applicable
4. Proof of Foreign Tax Credits, if applicable
5. Income tax return previously filed and proof of payment, if amended return is
filed for the same taxable year
6. Account Information Form (AIF) and/or the Certificate of the independent CPA
with Audited Financial Statements, if the gross quarterly sales, earnings, receipts
or output exceed P150,000.00
7. Proof of prior year’s excess tax credits, if applicable
Procedures:
1. Fill-up BIR Form 1702 in triplicate.
2. If there is payment:
Proceed to the nearest Authorized Agent Bank (AAB) of the Revenue District
Office where you are registered and present the duly accomplished BIR Form
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1702, together with the required attachments and your payment. In places where
there are no AABs, proceed to the Revenue Collection Officer or duly Authorized
City or Municipal Treasurer located within the Revenue District Office where you
are registered and present the duly accomplished BIR Form 1702 with the
required attachments and your payments. Receive your copy of the duly stamped
and validated form from the teller of the AABs/Revenue Collection Officer/duly
Authorized City or Municipal Treasurer.
3. For "No Payment" Returns including refundable/ creditable returns and returns
with excess tax credit carry over:
Proceed to the Revenue District Office where you are registered or to any Tax
Filing Center established by BIR and present the duly accomplished BIR Form
1702, together with the required attachments. Receive your copy of the duly
stamped and validated form from the RDO/Tax Filing Center representative
Deadline:
Final Adjustment Return or Annual Income Tax Return - On or before the 15th
day of the fourth month following the close of the taxpayer’s taxable year
Value-added Tax
Any person or entity who, in the course of his trade or business, sells, barters,
exchanges, leases goods or properties and renders services subject to VAT, if the
aggregate amount of actual gross sales or receipts exceed One Million Nine Hundred
Nineteen Thousand Five Hundred Pesos (P1,919,500.00). Since the proponents are
expecting of an annual sales exceeding P1,919,500.00 the business will be VAT
registered.
Tax Form
BIR Form 2550M - Monthly Value-Added Tax Declaration (February 2007 ENCS)
Documentary Requirements
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1. Duly issued Certificate of Creditable VAT Withheld at Source (BIR Form No. 2307),
if applicable
Procedures
1. Fill-up BIR Form No. 2550M in triplicate copies (two copies for the BIR and one copy
for the taxpayer)
2. If there is payment:
File the Monthly VAT declaration, together with the required attachments, and
pay the VAT due thereon with any Authorized Agent Bank (AAB) under the
jurisdiction of theRevenue District Office (RDO)/Large Taxpayers District Office
(LTDO) where the taxpayer (head office of the business establishment) is
registered or required to be registered.
The taxpayer must accomplish and submit BIR-prescribed deposit slip, which the
bank teller shall machine validate as evidence that payment was received by the
AAB. The AAB receiving the tax return shall stamp mark the word "Received" on
the return and machine validate the return as proof of filing the return and
payment of the tax.
In places where there are no duly accredited agent banks, file the Monthly VAT
declaration, together with the required attachments and pay the VAT due with the
Revenue Collection Officer (RCO) or duly authorized Treasurer of the
Municipality where such taxpayer (head office of the business establishment) is
registered or required to be registered.
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3. If there is no payment:
File the Monthly VAT Declaration, together with the required attachments with
the RDO/LTDO/Large Taxpayers Assistance Division, Collection Agent or duly
authorized Municipal/ City Treasurer of Municipality/City where the taxpayer
(head office of the business establishment) is registered or required to be
registered.
Deadline
Not later than the 20th day following the end of each month
Tax Form
BIR Form No. 2550Q - Quarterly Value-Added Tax Return (February 2007 ENCS)
1. Duly issued Certificate of Creditable VAT Withheld at Source (BIR Form 2307), if
applicable
Procedures
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1. Fill-up BIR Form 2550Q in triplicate copies (two copies for the BIR and one copy for
the taxpayer)
2. If there is payment:
File the Quarterly VAT Return, together with the required attachments, and pay
the VAT due thereon with any AAB under the jurisdiction of the RDO/LTDO
where the taxpayer (head office of the business establishment) is registered or
required to be registered.
The taxpayer must accomplish and submit BIR- prescribed deposit slip, which the
bank teller shall machine validate as evidence that payment was received by the
AAB. The AAB receiving the tax return shall stamp mark the word "Received" on
the return and machine validate that return as proof of filing the return and
payment of the tax.
In places where there are no duly accredited agent banks, file the Quarterly VAT
Return, together with the required attachments and pay the VAT due with the
Revenue Collection Officer (RCO) or duly authorized Treasurer of the
Municipality where such taxpayer (head office of the business establishment) is
registered or required to be registered.
The RCO or duly authorized Municipal/City Treasurer shall issue a Revenue Official
Receipt upon payment of the tax.
3. If there is no payment:
File the Quarterly VAT Return, together with the required attachments with the
RDO/LTDO/Large Taxpayers Assistance Division, Collection Agent or duly
authorized Municipal/City Treasurer of Municipality/City where the taxpayer
(head office of the business establishment) is registered or required to be
registered.
Deadline
Within twenty five (25) days following the close of taxable quarter.
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Tax Form
Every registered withholding agent on compensation, which includes, but not limited to
the following:
1) For amended return, proof of remittance and the return previously filed.
3) For Private Sector, copy of the list of MWEs who received hazard pay submitted to the
DOLE Regional/Provincial Offices-Operations Division/Unit, for the return period
March, June, September and December, if applicable.
4) For Public Sector, copy of Department of Budget and Management (DBM) circular/s
or equivalent on MWEs allowed to receive hazard pay, for the return period March, June,
September and December, if applicable.
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5) Electronic Tax Remittance Advice (eTRA) previously Tax Remittance Advice (TRA)
for National Government Agencies (NGAs) as required under DOF-DBM Joint Circular
No. 1-2000A and RR 1-2013.
- Proceed to the nearest Authorized Agent Bank (AAB) of the Revenue District Office
(RDO) where you are registered or withholding agent is registered and present the duly
accomplished BIR Form No. 1601-C, together with the required attachments (if
applicable) and your payment.
- In places where there are no AABs, proceed to the Revenue Collection Officer or duly
Authorized City or Municipal Treasurer located within the Revenue District Office where
you are registered or withholding agent is registered and present the duly accomplished
BIR Form No. 1601- C, together with the required attachments (if applicable) and your
payment.
- Receive your copy of the duly stamped and validated form from the teller of the
AAB's/Revenue Collection Officer/duly Authorized City or Municipal Treasurer.
- Proceed to the Revenue District Office where you are registered or where the
withholding agent is registered and present the duly accomplished BIR Form No. 1601-C,
together with the required attachments.
- Receive your copy of the duly stamped and validated BIR Form from the RDO.
Deadline
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On or before the tenth (10th) day of the month following the month the withholding was
made, except for taxes withheld for the month of December which shall be filed and paid
on or before January 15 of the succeeding year
Tax Form
BIR Form No. 1601-E: Monthly Remittance Return of Income Taxes Withheld
(Expanded) [Except for Transactions Involving Onerous Transfer of Real Property
Classified as Ordinary Asset]
Every registered withholding agent on Expanded Withholding Tax, which may include,
but not limited to the following:
2) An individual, with respect to payments made in connection with his trade or business.
However, insofar as taxable sale, exchange or transfer of real property is concerned,
individual buyers who are not engaged in trade or business are also constituted as
withholding agents.
4) All individuals, juridical persons and political parties, with respect to their income
payments made as campaign expenditures and/or purchase of goods and services
intended as campaign contributions.
Documentary Requirements
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4. Electronic Tax Remittance Advice (eTRA) previously Tax Remittance Advice (TRA)
for National Government Agencies (NGAs) as required under DOF- DBM Joint Circular
No. 1-2000A and RR 1-2013
- Proceed to the nearest Authorized Agent Bank (AAB) of the Revenue District Office
where you are registered or taxpayer concerned is registered and present the duly
accomplished BIR Form No. 1601- E, together with the required attachments and your
payment.
- In places where there are no AABs, proceed to the Revenue Collection Officer or duly
Authorized City or Municipal Treasurer located within the Revenue District Office where
you are registered or taxpayer concerned is registered and present the duly accomplished
BIR Form 1601-E, together with the required attachments and your payment
- Receive your copy of the duly stamped and validated form from the teller of the
AABs/Revenue Collection Officer/duly Authorized City or Municipal Treasurer.
- Proceed to the Revenue District Office where you are registered and present the duly
accomplished BIR Form 1601-E, together with the required attachments.
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- Receive your copy of the duly stamped and validated form from the RDO
representative.
Deadline
On or before the tenth (10th) day of the month following the month the withholding was
made, except for taxes withheld for the month of December which shall be filed and paid
on or before January 15 of the succeeding year
Loan Application
A small business loan can help the proponents in funding their venture. Not all
businesses can get a small business loan, so the proponents need to take special care in
applying for one.
If an individual, must be a Filipino, of legal age, not more than 65 years old upon
loan maturity
Properly filled-out and signed Business Loan Application Form and Statement of
Assets & Liabilities (available here for downloading)
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Photocopy of TCT, tax declaration and vicinity map of the offered collateral
Trade References / List of at least five major suppliers and clients with contact
names and contact details
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