How To Register With the BIR As Self Employed Professional, Freelancer, or Consultant

The question that hounds online freelancers, aspiring self-employed professionals (without a PRC license), and consultants is this: "How do I register with the Bureau of Internal Revenue?" or, "How do I pay my taxes". etc.

As an SEO/Online Marketing Consultant for an Australian firm, these same questions disturbed me for WEEKS. It's because I have absolutely NO IDEA how to approach BIR and register myself as an individual taxpayer and be eligible to pay my own taxes.

You're about to find out how I got my Certificate of Registration from the BIR in just 2 hours and 15 minutes!

Before I show you the EXACT process I went through to register, let me credit two important resources on the internet which provided me good information on how to register with the BIR as self employed. The first is this blog post from Three Things Baby and the other one is from Freelancepinoy.com.

The info within the above resources has been very helpful. However, my registration experience with the BIR has been slightly different. HERE IS HOW I DID IT, STEP BY STEP:

FIRST PHASE -- "THE PREPARATION"

Step 1:  Know Your RDO Number/Code

Do not leave this to chance. It's very important! Your RDO (Revenue District Office) is where you are registered as a taxpayer. This doesn't necessarily mean the closest BIR office to your house, but sometimes this is the case.

That's why YOU NEED TO MAKE SURE.

Call 981-8888, which is the BIR Hotline. There is a commercial ad just before the voice prompt. As soon as you hear a live human being on the line, just ask:

"Hi I just want to verify kung saang RDO ako currently registered. My TIN # is__________"

Make sure you ask where you are currently registered. Some people ask "what is the nearest RDO closest to my house.."..etc. This is wrong, as they will simply give you the nearest RDO. You have to know where you are registered exactly.

NOTE: If you don't have an existing TIN, just skip this step. If your RDO is located out of town, I'm sorry...you have to go there, and request to transfer to an RDO that is closer to your location -- by filling up the BIR Form 1905.

Step 2:  Prepare the required forms and documents

Here's what I prepared:

1. BIR Form 1901 - Print at least two (2) original copies. This is the registration form for professionals, sole proprietors, estates and trusts. Make sure you cross out the box "professional" as it is the one that applies more to your online occupation.

2. Existing Contract With A Client - The BIR officer referred to this as a "company certificate". This is any written agreement you have with a client of yours, which states that you are working for them on a consultant/freelancer basis. If you don't have any contract, I guess you need to request this from your client.

3. Birth Certificate and Any Proof of The Nature of Your Work - In the absence of a company certificate, you need to show any other proof of your status as an independent freelancer. Birth certificate would help establish your identity (although I prepared this, my RDO did not request this from me, surprisingly!). As for proof, you can show them any email, online job offer, or written terms of your agreement with a client.

4. Proof of Billing Address - This could be a Meralco bill, credit card bill, or internet post paid bill. Barangay clearance would also be accepted.

5. BIR Form 0605 - This is the payment form. Print three (3) original copies.

SECOND PHASE -- "THE ACTUAL VISIT"

Now that you have your documentary requirements, put on your battle gear and visit your RDO. Attack! Follow these steps:

Step 1: Go to your RDO at 8:30 am or earlier!

Do yourself a big big favor. Avoid going to BIR at noon. Be very early.

Also, avoid dates like the 25th of the month (filing of VAT returns) and 20th (filing of percentage tax returns), as the BIR hall will be very full packed.

Step 2: Go straight to the OFFICER OF THE DAY and show your 1901

Instead of asking the guard, numbering system personnel, and other random BIR staff, go straight to the officer of the day!

The officer of the day is the one that ANSWERS QUESTIONS FOR CONFUSED INDIVIDUALS like us.

The officer is also the one who will assess your application and recommend the proper tax types.

I suggest this: Bring all your requirements, fill out your forms in advance, then approach the officer of the day. Ask something like this:

"Hello magpaparegister po as self-employed professional, form 1901."

Make sure you use the word SELF EMPLOYED PROFESSIONAL. That is the phrase they understand. They don't understand freelancer, home based, online editor, internet marketing, etc.

At this point, they will probably ask: "May business name ka na?"

You have to quickly and constructively DISMISS that notion. I said something like this:

"No I don't have a business name po. I work independently po as a CONSULTANT and yung work ko po is online based (insert your line of work here -- writer, marketing, blogging, etc). Gusto ko po magfile ng taxes kase wala akong employer, client lang."

The keywords are: 1) no business name, 2) independent, 3) consultant, 4) online based 5) walang employer, 6) may CLIENT

This way, they will know what tax category you are in.

Step 3: Request the Officer to check/fill out any boxes in the 1901 and 0605 which you might have missed

The officer of the day is your friend. He/she will correct your form 1901 and 0605, verify your documents, and let you know of the next step:

Step 4: TIN Verification

I was asked to get a number, then go to Counter 1 for "Tin Issuance". Just tell the person behind the counter: "For TIN verification daw sir". Then give your accomplished 1901 form, client contract, and billing statement copy.

"Anong nireregister?"

I said: "Self employed professional / consultant".

*STAMP, click*.

Step 5: Pay the registration fee via Form 0605

Go to an accredited agent bank of the BIR. In my case, I paid the P500 registration at the Landbank branch within the same building of my RDO. If you're not sure where to pay or what to write in the form, ask the officer of the day.

Accomplish the Form 0605 in triplicate. It's just like depositing in a bank.

Step 6: Photocopy your "received" or stamped 1901 and 0605 forms. One copy each. Make it two copies just in case.

Step 7: Return to the guy at TIN Issuance and give your stamped 1901 and 0605, plus your documents/requirements.  If your RDO has a "COR" counter personnel, you can go there instead! He will then compile all your documents, then ask you to buy a documentary stamp tax.

Step 8: Buy documentary stamp (they'll show you where to buy for 15 pesos), then return to the guy/girl at TIN Issuance (or COR counter, if your RDO has it). After stamping and compiling, he will then endorse your application to another staff who will then be in charge of printing your Certificate of Registration (Form 2303).

When you see your application being endorsed for printing, rejoice!!

THIRD PHASE -- ACCOUNTING BOOKS and AUTHORITY TO PRINT

After half an hour of waiting, the Certificate of Registration (COR) will be released (that is, if you have a cool RDO like mine). 

Along with the COR, you will receive an "Ask for Receipt" signboard and a taxpayer's guide. The next steps after receiving the COR are these:

STEP 1: Go to the Counter where they serve "Books of Accounts". Show them your COR. They will then recommend what accounting books do you need based on your tax type. Don't hesitate to BUY their recommendation on the spot. Sure it's somewhat more expensive than the accounting books in the National Bookstore, but it helps you know what type of columnars they require. You are a first timer. So you need to go by the basic rules. :) They will then stamp/sign the books, which means, you are now authorized to use them.

STEP 2: Go to the counter where they serve "Authority to Print (ATP)". Request for BIR Form 1906. This is an application for printing of invoices or receipts. This is easy to fill up because most of the required fields are in the COR anyway. Upon filling out the ATP form, ask the counter personnel if he/she knows a good printer (printer as in, a BIR accredited person or company that prints invoices/receipts). 99.9% of the time, the personnel will say YES and fill out the remaining part of the 1906 for you. They will ask you to write your contact info at the bottom of the form 1906 so they can call you when your receipts are ready.

Mind you, the minimum job order is 10 booklets of receipts, which will cost you around Php 1,000 upon pickup of the receipts. So be prepared for this expense!

That's it! You are now registered!

ADDITIONAL TIPS AND GUIDELINES

1. Avoid asking too many "noob" questions. If you ask too much, BIR will think you have no idea what you're doing, and so they will also think your documents and requirements are NOT complete. Instead, ask questions only to proceed to the next step. For example, instead of asking "What should I write on this Form?", just ask "Please verify if I missed anything on the form". Be sure of yourself. 

2. Know if you are VAT or non-VAT. Generally, if your expected gross yearly income is less than Php 1.9 Million, you are non-VAT. That means, you won't pay 12% VAT but you will only pay 3% percentage tax monthly. Moreover, if your income is in dollars, you are VAT exempt.

That being said, good luck on your BIR application! For any questions about registration as self employed, just put in the comments section.