Doing Business In The Philippines
A foreigner living in the Philippines can start a business. You have to avail of the the appropriate visa though. Well, I should say you should possess the appropriate visa. Many are sitting in a Bureau of Immigration jail for working without a permit. That and overstaying one’s visa are the two number one things that get foreigners into trouble here.
Requirements for Doing Business In The Philippines
In short, if you’re on a tourist visa, you can’t run a business in the Philippines. Foreigners must avail of one of four visas that I know of to work in the Philippines.
The four visas that I know of that allow a foreigner to make money are:
- Quota Visa
- SRRV — Special Resident Retirement Visa
- SVEG — Special Visa for Employment Generation
- Section 13 Resident Visa — Usually means marriage.
There are articles on this website that discuss some of these and I’ve covered it extensionally in the Basic Expat Training Manual. I plan a major update to the manual that will include a detailed discussion of doing business in the Philippines. If you purchase the manual, you are entailed to all future updates at no additional cost. Even when the price of the manual goes up.
I plan to add more information on visas to this site on the various visas. When will I have the time?
The steps required to properly opening a business are staggering! My girlfriend’s family are accountants. She sometimes did work for her sister. Her sister is a CPA. She would spend a lot of time registering a new business for her sister. After looking at the requirements, I can see why!
I’ll try to summarize them here:
- Verify and reserve the availability of the company name with the Securities and Exchange Commission (SEC)
- Deposit paid-up capital in the Authorized Agent Bank (AAB) and obtain bank certificate of deposit
- Notarize articles of incorporation and Treasurer’s affidavit with notary public
- Register company with the Securities and Exchange Commission
- Payment of documentary stamp taxes (DST)
- Obtain community tax certificate (CTC) from the City Treasurer’s Office (CTO)
- Obtain Barangay clearance
- Obtain mayor’s permit to operate at the Licensing Section of the Mayor’s Office
- Buy special books of account at bookstore
- Register for taxes at the Bureau of Internal Revenue (BIR)
- Obtain the authority to print (ATP) receipt/invoices from the Bureau of Internal Revenue (BIR)
- Print receipts and invoices at the print shops accredited by the BIR
- Have books of accounts and Printer’s Certificate of Delivery of Receipts and Invoices (PCD) stamped by the BIR
- Initial registration with the Social Security System (SSS)
- Complete registration with SSS and Philippines Health Insurance Company (PhilHealth)
Now that would be pleasant, no?
Some of this simply boggles my mind. I’m living in the Philippines on a tourist visa, so I can’t operate a business here. When I get rich, I’ll get a SRRV which will allow me to operate a business in the Philippines. You don’t have to be rich but you do have to be better off than I am now. The day is coming where I will have one.
When I saw step number 9, I thought that surely there were other methods that could be used. I asked Jessie and she said no, they have to buy those set of books and make all entries by hand. Surely there as to be another way. If not, that would mean there would have to be a lot of bookkeepers working for a chain like Jollibee to enter each sale of french fries into a ledger!
So while a foreigner can do business in the Philippines, the requirements are substantial. A CPA will preform these steps for you and let you get back to actually working on your business in the Philippines.
Filed under: Expats in the Philippines
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