Did you know that there are 995,745 micro, small, and medium enterprises while only 4,761 consist of large businesses in the Philippines? Yes, small companies in the Philippines are way more important than you think, because for some they tend to belittle small corporations since the perception is that they are not essential. In the Philippines, there are a lot of small scale companies that are registered, which is the right action to do since this is part of the law in the country. Now, how do we identify small companies? These are companies that have less than 100 employees. Let us now find out the importance of business registration to small scale companies.
It is important for a company to be registered under the SEC, BIR, and the LGU in order to be recognized by the government as a legitimate business entity in the country. Also, in order to obtain investors, a company must be registered because any party that is willing to invest in a business can be verified by the tax status of the enterprise. Entrepreneurs that have a business and a common business name cannot register under the SEC, which means it is important to register your corporation as early as possible in order to acquire the business name that you want and to also have a brand image from the public. If your business is not registered, this could lead to a criminal penalty “Failure to Register” or operating an unregistered business. According to the BIR, the fine is less than P5,000 but not more than P20,000 and imprisonment of not less than 6 months but not more than 2 years. So you see, it is important to register your business in order to avoid criminal cases against the government.
Again, business registration is not just for large enterprises but also for small businesses. If your business is not registered under those three government agencies, you may get a penalty and a criminal case. While it is difficult to set-up a corporation in the Philippines because of business registration purposes, it is still a need to overcome this challenge since this is the legal way of doing business in the country. Remember that these points that are mentioned are very important in order to know the purpose in registering your business. Without registration, your business activities in your corporation are illegal and are not allowed under the eyes of the government. Now you have an idea why it is important to register your business even if you are a small scale company. Why don’t you try to register yours?