When you register with BIR, you can choose to be VAT- or non-VAT registered. This will affect how your taxes will be computed.

If you're VAT-registered, your tax is 12% of VAT payable (output tax - input tax). The output tax is computed from gross sales, while input tax is computed from expenses.

If you're non-VAT registered, your tax is 3% of gross sales.

You have to consider your projected gross revenue and expenses. If your projected gross revenue is P3 million or less, you have the option to choose between VAT and non-VAT. However, gross revenue of more than P3 million will automatically require VAT registration.

If your business will incur a lot of expenses to make a sale, it's better to be VAT-registered as taxes from these expenses (input tax) can be deducted from your total tax payable to BIR.

Yes, but you need to apply for this by submitting BIR Form 1900 (Application for Authority to Adopt Computerized Accounting System or Components Thereof) together with supporting documents.

You can view the form here. https://www.bir.gov.ph/images/bir_files/old_files/pdf/20181900.pdf

Yes, you need go to your current RDO and request a transfer, then get a Certificate of Registration and apply for new receipts or appeal to use old receipts from your new RDO.

These taxes are common for all types of business:

• Income Tax: If you're a sole proprietor or self-employed, your business income is subject to graduated income tax from 5% to 32%. If you incorporate your business, you need to pay the fixed 30% corporate income tax.
• Business Tax: If you're VAT-registered, the business tax is 12% of the VAT payable. If you're non-VAT registered, it's 3% of the gross sales.
• Withholding tax: This is applicable to those with salaried employees and third-party contractors, including lessors for office rent.

The minimum corporate income tax or MCIT is a tax imposed on corporations that have reached the 4th year of operation and have a net loss or zero taxable income or a normal income tax that's less than the minimum income tax. In such cases, companies need to pay 2% of the gross income of the corporation.

Here are the dates to remember for filing taxes:

Income tax

• April 15 (if you're paying annually)
• May 15, August 15, and November 15 (if you choose to pay quarterly)

Business Tax: VAT and Percentage Tax

• The 20th day of every month (if you choose to pay monthly)
• The 25th day of the month right after the quarter (if you decide to pay quarterly)

Withholding Tax

• The 10th day of every month (this is deducted from the salaries of employees; employers deduct this amount and pay it directly to the BIR)

You can file your taxes online and offline.

Online: Through the Electronic Filing and Payment System (eFPS), which is used for filing tax returns, including attachments, if any, and paying taxes due

Offline: Through the BIR office, where forms are manually filled out and payments are physically made through BIR-authorized agent banks.

Hybrid: Through eBIRForms, which is a tax preparation software that allows taxpayers to accomplish or fill out tax forms via the computer instead of the conventional manual process. Payment is still made physically through BIR-authorized agent banks.

Here are the documentary requirements for annual filing of income tax:

• BIR Form 2307 (Certificate of Creditable Tax Withheld at Source), if applicable
• Approved Tax Debit Memo, if applicable
• BIR Form 2304 (Certificate of Income Payments Not Subjected to Withholding Tax), if applicable
• Proof of Foreign Tax Credits, if applicable
• Previously filed income tax return and proof of payment, if amended return is filed for the same taxable year
• Account Information Form (AIF) or the certificate of the independent CPA with audited financial statements, if the gross annual sales, earnings, receipts or output exceed P3 million
• Proof of prior year’s excess tax credits, if applicable

Here are the documentary requirements for quarterly filing of income tax:

• BIR Form 2307 (Certificate of Creditable Tax Withheld at Source), if applicable
• Approved Tax Debit Memo, if applicable
• Previously filed income tax return, if an amended return is filed for the same quarter
  

If you're filing your income tax through eFPS, these are the steps you need to do:

• Fill out the applicable fields in BIR Form 1702 (Annual)/BIR Form 1702Q (Quarterly)
• Pay electronically by clicking on the “Proceed to Payment” button, fill out the required fields in the eFPS Payment Form, then click on the “Submit” button
• You'll receive a payment confirmation from the eFPS-AABs for successful e-filing and e-payment

These are the things you need to do if you're filing income tax using eBIRForms:

• Fill out the fields in BIR Form 1702 (Annual)/BIR Form 1702Q (Quarterly)
• Print the forms
• Proceed to the nearest BIR-authorized agent bank under the jurisdiction of the RDO where you're registered and present the form together with the required attachments and your payment
• If there's no BIR-authorized agent bank in your area, go to the Revenue Collection Officer or the city or municipal treasurer located within the RDO where you're registered, and present the form together with the required attachments and your payment
• Receive your copy of the stamped and validated form or electronic Revenue Official Receipt (eROR)

If you prefer filing your income tax manually, follow these steps:

• Fill out the BIR Form 1702 in triplicate copies
• Proceed to the RDO where you're registered or to any Tax Filing Center established by the BIR and present the form together with the required attachments
• Receive your copy of the stamped and validated form

Here are the documentary requirements for filing of VAT:

• BIR Form 2307 (Certificate of Creditable Tax Withheld at Source), if applicable
• Summary Alphalist of Withholding Agents of Income Payments Subjected to Withholding Tax at Source (SAWT), if applicable
• Approved Tax Debit Memo, if applicable
• Approved Tax Credit Certificate, if applicable
• Previously filed return and proof of payment, for amended return
• Authorization letter, if return is filed by an authorized representative

To file VAT declaration with payment:

• Fill out the BIR Form 2550M (Monthly)/BIR Form 2550Q (Quarterly)
• File the VAT declaration together with the required attachments and pay the VAT due at any BIR-authorized agent bank under the jurisdiction of the RDO or Large Taxpayers District Office (LTDO) where the taxpayer (head office of the business establishment) is registered
• Accomplish and submit the BIR-prescribed deposit slip. Your tax return will be stamped and machine-validated as proof of filing and payment.
• In places where there are no BIR-authorized agent bank, you can file your VAT declaration at your RDO
• You'll receive a Revenue Official Receipt upon payment of the tax from the Revenue Collection Officer

If you don't have payment due, these are all you need to do:

• Fill out the BIR Form 2550M (Monthly)/BIR Form 2550Q (Quarterly)
• File the VAT return together with the required attachments at the RDO/LTDO/Large Taxpayers Assistance Division that has jurisdiction over the registered address of the taxpayer (head office of the business establishment)

These are documents required for filing percentage tax:

• BIR Form 2307 (Certificate of Creditable Tax Withheld at Source), if applicable
• Approved Tax Debit Memo, if applicable
• For amended return, proof of payment and the previously filed return
• Authorization letter, if you're filing via an authorized representative

To file percentage tax through eFPS:

• Fill out the applicable fields in the BIR Form 2551M (Monthly)/ BIR Form 2551Q (Quarterly)
• Indicate the taxable amount (for quarterly percentage return, this is the total gross sales/receipts for the quarter)
• For quarterly filing, in case percentage taxes for the first, second and/or third month of the quarter have been paid, payment/s made are to be reflected in BIR Form 2551Q in Item No. 20A-Creditable Percentage Tax Withheld per BIR Form 2307
• After e-filing, proceed to online payment by clicking on the "Proceed to Payment" button

If you're filing percentage tax using eBIRForms, these are the steps you need to do:

• Fill out the fields in the BIR Form 2551M (Monthly)/ BIR Form 2551Q (Quarterly)
• Indicate the taxable amount (for quarterly percentage return, this is the total gross sales/receipts for the quarter)
• In case percentage taxes for the first, second and/or third month of the quarter have been paid, payment/s made are to be reflected in BIR Form 2551Q in Item No. 20A-Creditable Percentage Tax Withheld per BIR Form 2307
• Print the form
• Proceed to any BIR-authorized agent bank located within your RDO, and present the form and other requirements. If there's payment to be done manually, present the documents together with the BIR-prescribed deposit slip and payment. The percentage tax shall be paid at the time you file the return.
• In places where there are no BIR-authorized agent banks, you can go to the RCO, MRCOS facility or city/municipality treasurer where your business is registered. You'll receive an electronic Revenue Official Receipt (eROR) after payment.
• You can also pay through GCash, LandBank Link BizPortal (if you have an ATM account with LandBank, or a Bancnet ATM or debit card), or DBP Tax Online (for VISA and MasterCard credit card, or Bancnet ATM or debit card holders).

If you prefer filing your income tax manually, follow these steps:

• Fill out the fields in the BIR Form 2551M (Monthly)/ BIR Form 2551Q (Quarterly) in triplicate copies
• Go to any BIR-authorized agent bank within your RDO. Present the forms and other requirements, BIR-prescribed deposit slip, and payment. The percentage tax must be paid at the time the return is filed.
• If there are no BIR-authorized agent banks in your area, you can bring the documents and payment to the Revenue Collection Officer (RCO), Mobile Revenue Collection Officers System (MRCOS) facility, or city/municipality treasurer where your business is registered. You'll be given an electronic Revenue Official Receipt (eROR).
• - Receive your validated copy of BIR Form 2551M/ BIR Form 2551Q

You can also pay through GCash, LandBank Link BizPortal (if you have an ATM account with LandBank, or a Bancnet ATM or debit card), or DBP Tax Online (for VISA and MasterCard credit card, or Bancnet ATM or debit card holders).

Here are the steps for filing withholding tax:

• Submit BIR Forms 1902 and/or 1905 to your RDO within 30 days of receipt from employees
• Withhold the tax due from the employees following the tax table
• Remit the amount of tax withheld from the employee within the prescribed due date
• Do the year-end adjustment
• Submit BIR Forms 1604-C, 1604-F, and 1604-E (Annual Information Return), including the required alphabetical list of employees/payees on or before January 31 following the close of the calendar year
• Refund excess tax withheld, if applicable

Upon issuance of the BIR Certificate of Registration, you're already required to file tax returns the following month depending on your tax type registration, whether you're making a profit or not, and even if you're not yet operating.

BIR registration must be done within 30 days of DTI or SEC approval. Otherwise, you'll incur penalty charges.

Provided that your documents are complete and correct, BIR registration can be completed in 1 day. The release of the COR typically takes 3 to 5 working days.

The registration fee is P500, but you also need to pay the certification fee amounting to P100 and P30 for documentary stamps. If you're leasing your business space, you have to pay for the documentary stamp tax on lease as well, which is 1% of your annual contract amount plus P1.

Upon claiming your BIR Certificate of Registration, make sure that you get the "Ask for a Receipt" signage as BIR requires all establishments to display this. Subsequently, you need to purchase your books of account for stamping and registration, and apply for authority to print receipts.

The validity of your BIR Certificate of Registration is 1 calendar year. Even if you get your certificate December of the previous year, you'd still need to immediately renew it in January the following year.

BIR registration should be renewed annually and not later than January 31 to avoid penalties.

To renew your BIR registration, just complete the BIR Form 0605 (Payment Form), then go to a BIR-authorized agent bank and pay the P500 fee.