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I just recently resigned in the corporate world because I found another job that I know would give me a better way of living. I considered myself as a Virtual Assistant which means I work remotely for the clients outside the country or local. I’ve been thinking when do I update my status in BIR from employed to self-employed since I came from a corporate job. I find it challenging to process all the requirements but you need to consider it because it will help you in the long run and that makes you a responsible citizen for filing your tax.
Who counts as a self-employed taxpayer?
A self–employed worker is one engaged in any trade or business or occupation, who has no employer other than him or herself. Could be a member of a partnership that carries on a trade or business or someone who is otherwise in business for themselves, including part-time business.
Now that you know who is considered Self-employed, let me share with you the requirements so you can prepare the things you need on hand.
- For your BIR Certificate of Registration (COR), you will need the following:
- Tax Identification Number (TIN)
- Barangay Certificate
- Birth Certificate
- Form 0605
- Registration fee of 500
- Journal notebook
- For your BIR Official Receipts (OR), you will need the following:
- COR payment receipt
- Barangay Certificate
- One government-issued valid ID
- Form 0605
- OR fee is depending on how many booklets you needed and its size
I’m registered as a Self-employed Professional
I know you may be asking what status did I change to. I registered as a Self-employed Professional non-licensed because this category is more application than the other one since I don’t own a business that accumulates VAT. This is the right status for Freelancers who are working remotely for their clients or providing their services locally or internationally.
Some requirements mentioned above were not asked to me. I was not required to get a DTI permit and so as Mayor’s permit.
Before going through the Registration steps, make sure you have or have done the following:
Tax Identification Number (TIN)
It is the first requirement you need to have. Normally, you get your TIN from your first company employer. Most of the corporate jobs help you apply for a TIN so they can pay and file the Tax for you.
If you don’t have a TIN yet, you may easily get one as BIR made it easy to get one just by following this blog How to Get TIN ID Number Online using BIR eReg
Change of Revenue District Office (RDO)
As a freelancer working from home, you have to make sure that your TIN is in the correct RDO that covers the address you’ll be using in registration. If your TIN is currently registered in different RDO, then you have to file an RDO change to the BIR where your TIN was registered or go to the new BIR RDO, fill out a 1905 form, and request them to fax it to the BIR Taguig office for processing.
Since am currently residing in Manila where my TIN is originally registered, I didn’t have to request an RDO change but I needed to get another TIN for the update of my address. No need to worry it will all be on the same process along with registration with BIR.
I’ll be making it simple as it is effortless to process once you get there in the RDO, but I will be more detailed to getting your COR and getting an OR at the printing office below. If you have questions, feel free to comment and I’ll answer it as soon as I can. Please do not include any personal information.
- Accomplish BIR Forms 1901 and 1905 (1905 is only applicable for RDO Change) and submit them with the other requirements at your RDO that has jurisdiction over the location of your office or home.
- Pay the P500 fee at any authorized bank within the RDO’s jurisdiction and submit the fee along with BIR Form 0605. There may also be a payment counter at the RDO office.
- Return to the RDO. Pay the P15 Certification Fee and the P15 Documentary Stamp Tax, pick up your BIR Certificate of Registration, and “Ask for a Receipt” Notice.
- Register your accounting books and ledgers by having them stamped by the BIR.
- Now you can proceed with securing your Authority to Print (BIR Form 1906), which will allow you to print official receipts for your business/freelance transactions. Ten booklets of ORs cost approximately P1,200.
- You can find the nearest authorized printer in your area through BIR website HERE! Once you get there, just show the following documents:
- Barangay Certificate
- TIN ID
- 0605 form
- payment receipt
BIR registration is just the first step as a self-employed individual. The next step is figuring out how to file your own Income Tax Returns as an entrepreneur, professional, or a freelancer.
You can either learn it thru watching or reading-related articles about it or you can hire a bookkeeper so they can help you with keeping your records up-to-date and file your tax. In my case, I was referred by a cousin to a CPA, and if you’re interested in getting her service the contact details are indicated in the last part of this blog. Please also advise where you have taken her contact number.
Claiming my BIR Certificate of Registration (COR)
After the registration, you’ll be given copies of the form you have filled out so once you go back to claim the Certificate of Registration, you’ll be needing to show them in order to release the documents.
- The 1901 form and 0605 forms that were given back to you
- Journal notebooks that you can buy in National Bookstore or BIR. This Journal is to be used as a Book of Accounts which is required by the BIR as a self-employed professional to keep your records.
You will still need to get a queue number and once you’re called, just inform the officer that you’ll be getting your COR and they will be asking for the 1901 and 0605 forms.
After a few minutes, you will be called and advised to sign the ledger confirming that you have received the COR.
Then go to the officer in charge of stamping Journals. Show the officer your 1901 form and then the Journals to stamp on the first page. You’ll be asked to sign the officer’s ledger to confirm that your Journals have been stamped.
Printing of the Official Receipt Booklets
As a registered freelancer, I am required to issue an Official Receipt to my clients for my earnings. Meaning I will need to give receipts to my clients every earnings whether local or international. Before I can issue receipts to my clients, I need to have an official receipt printed by a BIR-accredited printing press facility.
As soon as you have received the copies of your BIR forms, you may now proceed to their Authorized printing press and you can find the nearest one here bir.gov.ph
Once you get there, you will be singing relevant forms including the Authority to Print form, and pay the amount depending on what OR booklets you will be getting. They will issue you a receipt and it will take up to two weeks to print your OR booklets including their BIR process. They will be contacting you as soon as the ORs are available.
- The details outlined in this post and specific processes followed were done in BIR Pasig City.
- Prior to starting the registration, call your nearest BIR Revenue District Office (RDO) covering your area of business/residence address, the exact process, and the requirements they need. BIR RDO offices have different processes so I’d suggest contacting them directly.
- My current address is still being covered by the same RDO when I was working in Corporate.
- The information I have collected and shared in this post are from different blogs and experiences who have undergone the same process.
- My experience may not be applicable but the summary, importance, and guide of the BIR Registration concept are written here.
Related article: Changing SSS Status to Voluntary Paying Contribution Online