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There are at least 3 types of taxes you need to pay:
- Income tax – if you are a sole proprietor or self-employed, your business income is subject to graduated income tax from 5% to 32%, while if you incorporate your business, you pay the fixed 30% corporate income tax;
- Business tax – if your annual gross sales or revenues exceed P1,919,500, your sales or revenues will be subject to 12% value-added tax (VAT); otherwise it will be subject to 3% percentage tax;
- Withholding taxes – applicable to those with salaried employees and third party contractors, including lessors for office rent.
Yes. The business permit is a local business tax imposed by the local government and is different from the national tax imposed by the BIR. It is based on the annual gross sales or receipts with rates that vary depending on the nature of your business.
No. It is not deductible directly from annual income tax due, but it is an allowable deduction from your taxable income to reduce your income tax due.
As long as you can handle the bookkeeping yourself, there is no need to hire a full-time accountant yet. However, the moment you grow your business it will be difficult to manage if you still have to do it yourself.
It depends. If your gross quarterly receipts or sales exceed P150,000, you are required to file audited financial statements and you need to hire the professional services of a CPA.
No. You only have to get one TIN in your lifetime except if you intend to incorporate a business.
Unlike a sole proprietorship where the personal TIN of the owner is used by the head office and all branches, a corporation gets a separate TIN from the Securities and Exchange Commission (SEC).
Caveat: Using multiple (personal) TINs is punishable by criminal liability.
Client–Centered and Value–Driven Services
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focused on providing comprehensive consulting services directly to the management and business owners using our “five (5)step end-to-end framework” and is aimed to contribute to achieving business goals
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provides wide-range of outsourcing services that is aimed to absorb Accounting and Finance functions, including Tax, Payroll, and Audit to support the management in executing strategies and achieve cost efficiency
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