Republic of the Philippines

Department of Education

PUBLIC TECHNICAL-VOCATIONAL
HIGH SCHOOLS

Unit of Competency: Legalize a Business

Module no. 5 Module Title: Legalizing a Business

 ACKNOWLEDGMENT

The Department of Education wishes to extend thanks and

appreciation to the representatives of the different Secondary Technical-
Vocational Schools who shared their expertise in developing the
Competency-Based Curriculum (CBC) and Competency-Based Learning
Materials (CBLM) on May 25-30, 2009 at the Marikina Hotel, Marikina
City.

This learning material was developed, enhanced and refined by the

following personnel:

Writeshop on the Development of CBC-CBLM

Writers:

MARYAN C. CABASAG
Solana Fresh Water Fishery School

MA. GENEFREDA M. CUANAN

Don Alejandro Roces Sr. Science – Technology High School

CECILIA C. BUNAO
Don Alejandro Roces Sr. Science – Technology High School

MA. JOSEFINA B. LUNA

E. Rodriguez Vocational High School

DAISY VILLANUEVA
Malolos Marine Fishery School

GAY BUENAVISTA
Muntinlupa Business High School

JEANNETH CUETO
Muntinlupa Business High School

OFELIA F. BERNARDO
Jones Rural School

ROLANDO M. CUBANGBANG
Jones Rural School
JESUSA C. IGLESIAS
San Jose National Agricultural And Industrial High School

LITO L. AGCAOILI
Alcala Rural School

Encoders:

WARREN LLOYD MANUEL

MARISOL E SALDIVAR

MIA LORAINE MANUEL

CARLO MAGPANTAY

Editor:

ESTRELLITA EVANGELISTA, Ed. D.

Facilitator:

ORLANDO MANUEL, Ph. D.

Cabaruguis National School of Arts and Trades

Writeshop on the Refinement and Enrichment of CBC-CBLM of

Entrepreneurship, June 5-7, 2009, Marikina Hotel, Marikina City

MARYAN C. CABASAG
Solana Fresh Water Fishery School
Iraga, Solana, Cagayan
Region 02

MA. GENEFREDA M. CUANAN

Don Alejandro Roces Sr. Science – Technology High School
Roces Ave., Brgy. Obrero, Quezon City
NCR

CECILIA C. BUNAO
Don Alejandro Roces Sr. Science – Technology High School
Roces Ave., Brgy. Obrero, Quezon City
NCR
MA. JOSEFINA B. LUNA
E. Rodriguez Vocational High School
Nagtahan, Sampaloc, Manila

OFELIA F. BERNARDO
Jones Rural School
Jones, Isabela
Region II

ROLANDO M. CUBANGBANG
Jones Rural School
Jones, Isabela
Region II

JESUSA C. IGLESIAS
San Jose National Agricultural and Industrial High School
Alcala Cagayan
Region II

Encoders:

WARREN LLOYD MANUEL

Fairview, Quezon City

MARISOL SALDIVAR
Taguig City

EDUARDO PINEDA
Cauayan, Isabela

CARLO MAGPANTAY
Project 4, Quezon City

MIA LORAINE MANUEL

Fairview, Quezon City

Editor:

ESTRELLITA EVANGELISTA, Ed. D.

Facilitator:

ORLANDO MANUEL, Ph. D.

Cabaruguis National School of Arts and Trades
 Writeshop on the Finalization of CBC-CBLM of Entrepreneurship
July 1-5, 2009, Marikina Hotel, Marikina City

MARYAN C. CABASAG
Solana Fresh Water Fishery School
Iraga, Solana, Cagayan
Region 02

MA. GENEFREDA M. CUANAN

Don Alejandro Roces Sr. Science – Technology High School
Roces Ave., Brgy. Obrero, Quezon City
NCR

Encoder:

MIA LORAINE MANUEL

Facilitator:

RENE GAOR DELFINO

Muntinlupa Business High School

Editors:

CAROLINA F. CHAVEZ
Principal II
Muntinlupa Business High School

AIDA T. GALURA – VSA II

Angeles City National Trade School

BEATRIZ A. ADRIANO
Principal IV
E. Rordiguez Vocational High School

CORAZON ECHANO, Ph.D.

Consultant
 TABLE OF CONTENTS

Module Title. Legalizing a Business..............................................1

Pre-test............................................................................................1

LO1. Enumerate and Explain the Procedure in

Legalizing Business........................................................................1
Let Us Study....................................................................................1
 Procedure in Registering a Business.......................................4
 Benefits Derived from Registering your Business....................4
 Sample of Legal Documents...................................................6
Let Us Remember............................................................................12
How Much Have You Learned?........................................................12
Let Us Apply What You Have Learned..............................................12

Post-Test.........................................................................................16

Key to Correction.............................................................................17
 HOW TO USE THIS MODULE

Welcome to the Module “Legalizing a Business”. This module

contains instructional materials and activities for you to complete.

The unit of competency “Legalize a Business” contains the

knowledge, skills and attitudes required for the course
Entrepreneurship.

You are required to go through a series of learning activities in

order to complete each of the learning outcomes of the module. Follow
these activities on your own and answer the Self-Check at the end of
each learning activity.
If you have questions, don’t hesitate to ask your teacher for
assistance.
 MODULE V

COURSE : ENTREPRENEURSHIP III

UNIT OF COMPETENCY : LEGALIZE A BUSINESS

MODULE TITLE : LEGALIZING A BUSINESS

SUGGESTED DURATION : 12 HRS

WHAT IS THIS MODULE ABOUT?

This module covers the knowledge, skills, attitudes and values

needed in legalizing a business.

WHAT WILL YOU LEARN?

At the end of this module, you should be able to:

a. enumerate the procedure in legalizing the business;

b. gather legal documents pertaining to business/enterprise; and
c. explain the importance of registering the business to various
government offices.

WHAT DO YOU ALREADY KNOW?

Pre-test

Let us find out how much you already know about legalizing a
business. Read and understand the questions below. Choose the
correct answer by writing the letter of your answer in your quiz
notebook.

1. After registering with the DTI, the certificate becomes your proof
of _____.
a. authority to operate a business
b. business ownership
c. license to operate
d. payment of taxes
2. Where do you need to go to in order to secure the municipal
license or Mayor’s permit which will serve as your license or
permit to operate the business?
a. BIR
b. BPLO
c. CDA
d. DTI

1
3. Article of Partnership or Article of Incorporation should be
registered with this agency.
a. BIR
b. DTI
c. SEC
d. YECS
4. If you need to systematize the payment of taxes of your
business, where will you go?
a. BIR
b. DOLE
c. SEC
d. SSS
5. It is necessary to register your business to make it _____.
a. functional
b. legal
c. operational
d. profitable

2
LESSON 1

ENUMERATE AND EXPLAIN THE STEPS/PROCEDURE IN MAKING

THE BUSINESS LEGAL

WHAT IS THIS LESSON ABOUT?

This lesson discusses the steps/procedure in making the business

legal.

WHAT WILL YOU LEARN?

At the end of the lesson, you should be able to:

1. enumerate and explain the steps/procedure in legalizing a

business;
2. gather legal documents pertaining to business; and
3. emphasize and explain the importance of registering the business
and various government offices.

LET US STUDY

Words to Study

Ownership means an exclusive right of a person to a

business
Authorization is the issuance of approval to operate
Legalize means to be permitted by law
DTI – Department of Trade and Industry
DOLE – Department of Labor and Employment
SSS – Social Security System
SEC – Securities and Exchange Commission
CDA – Cooperative Development Authority
BPLO – Business Permit and Licensing Office

Legality of your business venture is necessary to make your

operation legal. The following pages shows some of the documents to be
secured from the different governments agencies to run your enterprise
legally. Without compliance with the legal requirements your business is
considered illegal. These are documentary transactions between the
owner of the business and the government.

3
 I need to get a
permit for my
business,
where can I
ask for
assistance?
DTI DOLE SSS
SEC BPLO CDA
Barangay Permit or
Business Clearance

The following is the procedure in registering a business as

mandated by the Introduction to Entrepreneurs of Small Enterprises,
Research and Development Foundation (SERDEF).

 Register your business name with the Department of Trade and

Industry (DTI). The certificate issued after registration becomes
your proof of business ownership.
 Register with your municipal city government. When you have
a municipal license or a mayor’s permit, this serves as your
authorization to conduct or operate the business.
 Register with the Bureau of Internal Revenues (BIR). This will
help systematize your financial operation and payment of taxes.
 You have to register at the Social Security System (SSS) if you
have five or more employees.
 Register the Article of Partnership or Article of Incorporation
with the Securities and Exchange Commission (SEC).
 Register with the Department of Labor and Employment.

There are several benefits derived from registering your business

with the government, as follows:

1. When you register your business with the Department of Trade

and Industry, the certificate issued to you becomes your proof
of business ownership.
2. The municipal license or Mayor’s permit issued to you serves as
an authorization for you to operate your business.
3. Your registration with the Bureau of Internal Revenue will help
you systematize your financial operations and the payment of
taxes.
4. If you have registered your business enterprise with
Cooperative Development Authority (CDA)which is optional, you
can enjoy the following privileges:

4
 a. Exemption from taxes and fees except from real property and
capital gains tax, import duties and taxes, value-added tax on
imported articles, taxes on income not arising from the CDA
activity such as interest, royalties, prizes and dividends.
b. Exemption of the CDA derived income from the computations of
the owners or members in division.
c. Exemption from any government rules and regulations on
assets, income and activities directly connected with the
services of CDA.

It is a must to register your business for your own benefit and

protection. When your business has been registered you are now
ready to own your business and face challenges coming your way.

(The following pages show some samples of legal documents pertaining to

business/enterprise.)

5
Sample of Local Business Clearance as Issued and Signed by the
Office of the Barangay Captain

6
 Sample of Business Permit and Licence to be Issued by the Office of
the Mayor

Front Page

7
Back Page

8
LET US APPLY WHAT YOU HAVE LEARNED

Activity 1. Interview a business owner in your neighborhood. Ask

him/her how the business was registered, how much it costs him/her to
register his/her business. Share interview results with the class.

Activity 2. Interview a shareholder of a successful cooperative

enterprise. Ask how he/she registered the business and how much is
the cost.

LET US REMEMBER

As an entrepreneur, it is important to register your

business to various government offices for your own
benefit and protection.

HOW MUCH HAVE YOU LEARNED?

Activity 1

Write the steps in registering your business. Record them in the

correct order. Do this in your quiz notebook.

12
 Activity 2

Filling-up of legal forms.

Directions:
Fill-out the application form in applying for a business permit.

Front Page

13
Back Page

14
RESOURCES:

References
Legal documents from different government agencies
Business plan

REFERENCES:

Villanueva, et. al. Business Management III,

Adriana Publishing Co. Inc., pp.119-121, Cubao, Quezon
City
Teneza, et. al. Business Management III,
Shekinah Publishing and Printing Press, pp.173-176,
Las Pinas City
http://www.businessplanpro.com
http//www.business.org
http//www.businessdictionary.com

15
Post-Test

Let us find out how much you already know about legalizing a
business. Read and understand the questions below. Choose the
correct answer by writing the letter of your answer in your quiz
notebook.

1. After registering with the DTI, the certificate becomes your proof
of _____.
e. authority to operate a business
f. business ownership
g. license to operate
h. payment of taxes
2. Where do you need to go to in order to secure the municipal
license or Mayor’s permit which will serve as your license or
permit to operate the business?
a. BIR
b. BPLO
c. CDA
d. DTI
3. Article of Partnership or Article of Incorporation should be
registered with this agency.
a. BIR
b. DTI
c. SEC
d. YECS
4. If you need to systematize the payment of taxes of your
business, where will you go?
a. BIR
b. DOLE
c. SEC
d. SSS
5. It is necessary to register your business to make it _____.
a. functional
b. legal
c. operational
d. profitable

16
KEY TO CORRECTIONS

Pre-test and Post-Test

1. B
2. B
3. C
4. A
5. B

17