Planning on starting a corporation in the Philippines? Here’s how you can do it.
What is a Corporation?
There are many different types of business entities – one of these is a corporation. This organization is a legal entity that’s distinct and separate from its owners.
It can be treated as a single entity, with rights and responsibilities similar to those of an individual. For example, a corporation can take a loan or borrow money, own and sell assets, pay taxes, enter contracts, sue or get sued, and many others.
Although it’s usually comprised of many people, it is often treated as a single entity.
Starting a Corporation in the Philippines
Step 1. Form your organization.
You’ll need to set up your capital:
- 0% Foreign Equity: $100 (Php5,000)
- Less than 40% Foreign Equity: $100 (Php5,000)
- More than 40.01% Foreign Equity: $200,000 (Php4,800,000)
You should also have 2 to 15 directors or incorporators (majority should be residing in the Philippines).
There should be at least four officeholders:
- President (also the company’s signatory; doesn’t have to be a resident of the Philippines)
- Corporate Secretary (in charge of the company’s administration; should be a resident of the Philippines)
- Treasurer (in charge of the company’s finances; should be a resident of the Philippines)
- Compliance Officer
Step 2. Register your company with SEC (the Philippine Securities and Exchange Commission). Today, it’s easy to do that online.
Head over to SEC’s Company Registration System. Check whether your desired company name is available, if it is, then you can proceed to the next step.
Step 3. Get your barangay clearance.
Step 4. Process your business permit at the mayor’s office.
Step 5. Register with the BIR (Bureau of Internal Revenue).
Step 6. Register as an employer at various regulatory agencies, including the SSS (Social Security System), Pag-IBIG or HDMF (Home Development Mutual Fund), and PhilHealth (Philippine Health Insurance Corporation).
You can also get medical insurance, but this is optional.
Step 7. Start your business.
Note that you don’t need to open a physical store or office to start a corporation. If you’re based at home, you can use your personal address as your business address, too.