How to Start a Business in the Philippines

The Philippines a flourishing country and among the fastest growing economies in Asia. The country is moving forward with a highly educated population and a large deposit of natural resources. It belongs to the top ten producers of copper, chromite and gold in the world. The friendly business environment is attracting foreign investors to establish the Philippines as one of the prominent business centres in Asia. Thus, a plan of starting a business in the Philippines is fruitful and advantageous for any entrepreneur in the world. The country does not only provide you with the incentives and offers, but also a fertile infrastructure and friendly business milieu.

Advantages of Starting a Business in the Philippines

  • The manpower in the Philippines is skilled and inexpensive
  • The Philippines is located in the heart of Asia. It is also connected to the four major capitals of the region which connects a million people from Asian countries
  • There is availability of Special Economic Zones, subject to only 5% overall tax rate
  • The country has an open and friendly economy which allows 100% ownership in most of the sectors
  • The Philippines provides well-developed communication, transportation, economic and business infrastructure
  • A company in the Philippines has access to the wide ASEAN market and its vast trade opportunities

How to Start a Business in the Philippines?

The Philippines is no more just a place for leisure; starting a business in the Philippines for foreigners has become simpler over the years. The government is offering incentives and supporting a Build-Operate-Transfer (BOT) investment scheme to attract businessmen to invest and start their business in the country. The Philippine government has simplified the incorporation process for all kinds of businesses to encourage investors and entrepreneurs. Here is the simple procedure for starting a business in the Philippines:

  1. The first step in starting a business in the Philippines is to get registered the proposed business name with the following departments, according to the type of business:
  • Sole proprietorship – The Department of Trade and Industry (DTI)
  • Corporation/Partnership – Securities and Exchange Commission
  • Cooperative – Cooperative Development Authority
  1. Apply for the business permit and license from the local municipality where the business is to be situated
  2. Once you get the permission from the municipality, you need to obtain sector-specific clearance for your business
  3. Register the company with the Bureau of Internal Revenue (BIR) District office for authority to print invoice and book of journal
  4. It is mandatory to register your business with the following offices to be in line with the government regulations:
  • Social Security System (SSS) – For availing social security benefits
  • Department of Labour and Employment (DOLE) – For occupational safety and Health standards
  • PhilHealth – For availing Medicare benefits
  • PAG-IBIG fund – Mandatory for employees covered by the Social Security System (SSS)
  • Department of Environment and Natural Resources (DENR) – For availing an Environmental Compliance Certificate

Requirements for Doing Business in the Philippines

For Sole Proprietor Registration

For Corporate Registration

  • A copy of government issued ID
  • A duplicate proposed business name registration form
  • Payment of registration fees fixed on territorial based with documentary stamp tax
  • Complete employee data form
  • Copy of Municipality permission letter
  • Community tax certificate
  • Location and Barangay clearance
  • Fire safety and electrical inspection certificate
  • Occupancy certificate and building permit
  • Contract of lease, if any
  • Verification slip form
  • Articles of incorporation
  • Notarized bank certificate
  • Treasurer’s affidavit
  • Written undertaking to change the name of the corporate by trustee or Director
  • Clearance certificate from other government agencies
  • Foreign investment application form (for foreign corporation subsidiaries
  • List of members and contributed amount certified by the secretary
  • Registration fee
  • Complete employee data form
  • Copy of Municipality permission letter
  • Community tax certificate
  • Location and Barangay clearance
  • Fire safety and electrical inspection certificate
  • Occupancy certificate and building permit
  • Contract of lease, if any

So, if you are planning to start a business in the Philippines, go for it! The business-friendly Philippine government provides opportunities for entrepreneurs to start a small business and reap all the advantage. Business Setup Worldwide is a management consultancy which helps to establish your business in the international market. We help our clients in understanding the procedures to start a business in the Philippines. Our experts can assist you in the incorporation process, taxation, legal procedures, accounting and financial management. For further details on how to start a business in Philippines, contact us – we’d be glad to assist.

About the Author

Shalu.Lal@bsworldwide.com's picture

Shalu Lal is an engineer in the making fascinated by the idea of contemplating and writing, who dived into Digital Marketing and found her cup of tea.