In any country, a business must be registered with the nation’s tax office to monitor the taxes, contributions, and other things. In the Philippines, the Bureau of Internal Revenue (BIR) monitors the taxes, fees, and contributions of all businesses and individuals, and ensures that all dues are paid, and the company’s records are free of discrepancies.
Remember, through these taxes, the Philippine government funds its projects and contracts so correct payment is paramount for continuing services. If you are just starting a business or have been running one informally, registering your company with the BIR is a must as it allows you to operate your company within the bounds of the law. If you still need more convincing, here are the 7 reasons why you should register your business with the BIR:
1. Help your community
Governments, both national and local, use taxes to improve communities. These projects are manifested in road building and expansion, urbanization efforts, job hunts and opportunities, improved educational institutions and facilities, safer public spaces, better healthcare, and better planning. By registering with the BIR, you help your community and yourself!
2. Better advertising and PR
With a BIR registration, you can better promote your business, products, and services, as you no longer need to hide under the table. The certificate of registration allows you to build self and brand confidence, enabling you to take advantage of platforms like social media to generate more sales and potentially grow your business. You may also deal with advertising agencies to gain even more leverage on the media and expand your reach.
3. Gain credibility
A BIR certification gives your brand credibility, as it indicates that you are operating legally and are being monitored by government agencies and departments. This is more than just a certificate as it gives your clients peace of mind as they can rest assured they are not dealing with scams. This builds trust between you and your customers. You can also serve not just individuals, but other businesses as well, generating more sales. Note that companies only transact with government accredited agencies.
4. Endless growth opportunities
Having your business registered to the BIR will provide your brand with endless opportunities. By operating as a legal entity, your company becomes more prized in the eyes of investors. Big-time investors will only loan you capital or invest in you if they know your business is legitimate. With a certificate from the BIR, you can easily gather additional capital by pitching to investors. With the BIR registration, you can prove your authority, thereby landing more contracts and profitable projects.
5. Better access to financial services
Being BIR registered is essential to gaining access to financial services like bank loans, corporate accounts, and other financing types. These financial services will help your brand grow to what you envision it to be; but only if they can see that you can present the needed documents to prove you are legally operating.
6. Evade penalties
No one gets away doing wrong without being penalized. In the Philippines, failure to comply with BIR registration can land you fines from 5,000 pesos up to 20,000 pesos, and even your little corner in jail, with a stay lasting 6 months to 2 years. That’s definitely not the vacation you’d imagine! Though the BIR registration process takes lots of effort, it is much better than the hefty sum you must pay for fines and posting bail. Six hours to a day is a much more viable option compared to a prison sentence. Choose how you’d like to spend your time.
7. Provide better services
When your business becomes certified, you can provide better services as you can invest more in improving and expanding your brand. Most importantly, you can begin issuing official receipts. These receipts not only give your customers security, but they also help you properly monitor your business transactions and do a cross-reference. Remember, most corporations and even individuals will not invest their hard-earned money supporting businesses that are not accredited. Most want an official receipt to monitor transactions.
Running a business in itself is quite a challenge without enough preparation. It becomes even more tedious when there are legal issues and government investigations, coupled with the fear of “I will get caught.” No one is above the law. What to do? Fall in line and take the time to prepare your registration. If you don’t know where to start, call us for a free 30-minute consultation. We can help you gather the requirements you need to register your business in the Philippines.