Do You Need to Register an Online Business in the Philippines?

Short answer: Whether you sell on Shopee, Lazada, TikTok Shop, or offer freelance services on Raket, Fiverr, or run a store through Instagram, Philippine law requires you to register your business and pay taxes on your income.

Here’s what registration actually involves, why it matters, and how to get it done without spending a week at various government offices. Not sure where you fit in? Take the quick quiz and get your personalized next step in three questions.

Why Registration Is Required for Online Businesses

The BIR made this explicit in Revenue Memorandum Circular (RMC) No. 60-2020, which specifically covers persons and businesses earning income through online or digital transactions. This includes online sellers, freelancers, content creators, virtual assistants, and digital service providers, regardless of income level.

The rule isn’t new. What changed is enforcement. The BIR has since issued additional regulations (including RR No. 3-2025, which extends VAT obligations to digital service providers) making it clear that operating online doesn’t exempt you from tax obligations.

Three things registration gives you that unregistered businesses don’t have:

1. The legal right to issue official receipts or invoices (required by most clients and platforms)
2. Access to government financing programs, loans, and business grants
3. Protection if the BIR ever comes knocking. Registered businesses have documentation; unregistered ones face back taxes plus penalties

What “Registering Your Online Business” Actually Means

For most Filipino online entrepreneurs, especially sole proprietors and freelancers, registration happens in three steps:

Step 1: DTI Business Name Registration

Register your trade name with the Department of Trade and Industry. This gives you the exclusive right to use your business name within your chosen coverage area.

How to do it: Through the DTI Business Name Registration System (bnrs.dti.gov.ph). The entire process is online. No personal appearance required. You’ll need a valid government-issued ID and your preferred business name.

One important update as of September 2025: The DTI now requires online sellers to obtain a DTI Trustmark, which serves as official recognition that your online store meets e-commerce standards in the Philippines.

Sole proprietors register with DTI. Partnerships and corporations register with the SEC instead.

Step 2: BIR Registration

Once you have your DTI certificate, you have 30 days to register with the Bureau of Internal Revenue at your Revenue District Office (RDO).

This is where you get:

• Your Tax Identification Number (TIN), if you don’t already have one. You are only allowed one TIN for life, so if you were previously employed, use your existing TIN
• Your Certificate of Registration (COR), also called BIR Form 2303. This is the document that proves you’re a registered taxpayer
• Your Authority to Print official receipts or invoices

For sole proprietors, the registration form is BIR Form 1901. The BIR’s ORUS (Online Registration and Update System) now allows some steps to be done digitally.

The annual BIR registration fee has been waived since January 2024 under the Ease of Paying Taxes Act (EOPT).

💡 Once your BIR Form 2303 (Certificate of Registration) arrives, keep the original safe and display it at your place of business. The BIR requires this. Need help getting registered? Taxumo’s Business Registration service can handle the process for you.

Step 3: Mayor’s Permit (Local Business Permit)

After BIR registration, you’ll need a Mayor’s Permit from your city or municipal hall. This is issued annually and must be renewed every January (deadline: January 20).

For purely online businesses, you can use your residential address as your place of business.

What Business Structure Should You Choose?

For most solo online entrepreneurs in the Philippines, sole proprietorship is the starting point. It’s the simplest structure, has the lowest cost to register, and is what most freelancers, online sellers, and micro-business owners use.

Here’s how the structures compare:

Structure	Register With	Best For
Sole Proprietorship	DTI	Freelancers, online sellers, solo businesses
Partnership	SEC	Two or more co-owners
Corporation (OPC or Stock)	SEC	Businesses needing investment or limited liability

You can always change your structure later as your business grows. Start with what fits your current setup.

Do You Need to Charge VAT?

This depends on your annual gross sales:

• Below ₱3 million/year: You’re likely a Non-VAT taxpayer. You’ll pay percentage tax (3% of gross receipts under the standard rate), or you may qualify for the 8% flat income tax rate on gross receipts in lieu of income tax and percentage tax.
• Above ₱3 million/year: You’re required to register as a VAT taxpayer and charge 12% VAT on applicable sales.

If you’re just starting out, you almost certainly fall in the Non-VAT category.

💡 If your gross income exceeds ₱3,000,000, you are VAT-registered and must use the graduated rates. The 8% option is not available to VAT-registered taxpayers. Not sure which applies to you? Chat with our team for guidance.

Tax Obligations After Registration

Registration is a one-time process. But once registered, you have ongoing filing obligations throughout the year. For most non-VAT sole proprietors and freelancers, this typically includes:

• Quarterly percentage tax via BIR Form 2551Q (note: the old monthly Form 2551M has been replaced by this quarterly form under EOPT)
• Quarterly income tax returns
• Annual income tax return: BIR Form 1701 or BIR Form 1701A, filed by April 15 each year
• Books of accounts: your official financial records, which must be registered with the BIR

Missing these filings triggers penalties: a 25% surcharge on unpaid taxes plus 12% annual interest. The penalties compound quickly, so staying current matters more than most new business owners realize.

💡 Keeping track of quarterly and annual deadlines is where most solo business owners fall behind. Taxumo automatically computes your taxes, sends deadline reminders, and lets you file and pay in minutes. No CPA needed for routine filings. Sign up for free and see your upcoming obligations.

Common Questions About Online Business Registration

I sell on Shopee/Lazada. Do I still need to register?

Yes. BIR RMC No. 60-2020 specifically covers marketplace sellers. Some platforms are now required to report seller transactions to the BIR, which means the BIR may already have data on your sales, whether or not you’re registered.

I’m a freelancer, not a “business.” Do I need to register?

Yes. Freelancers (designers, developers, writers, virtual assistants, consultants) are considered self-employed professionals and must register with the BIR. The DTI registration step may be optional if you’re not using a trade name, but BIR registration is required.

What if I’ve been operating unregistered for years?

You can still register now. Voluntary disclosure generally results in lower penalties than waiting for the BIR to find you. It’s worth speaking with a CPA to understand your options. Taxumo’s Marketplace connects you with CPAs who handle exactly this kind of situation.

Can I do all of this without going to a government office?

DTI registration is fully online. BIR registration still requires a visit to your RDO for most applicants, though parts of the process are now digital through ORUS. Mayor’s Permit processing varies by city, some have online options, others still require in-person steps.

How Taxumo Helps

Once you’re registered, keeping up with quarterly and annual filings is where most solo business owners fall behind. Taxumo automates your tax computations, reminds you of upcoming deadlines, and lets you file and pay directly, without a CPA for routine filings.

If you need help with the registration itself, Taxumo’s Business Registration service handles DTI, Mayor’s Permit, and BIR registration on your behalf, so you don’t have to navigate the offices yourself.

Register your business with Taxumo →

Already registered? Start filing your taxes on Taxumo →

For the most current BIR requirements, always verify with the official BIR website (bir.gov.ph) or consult a licensed CPA. Tax regulations in the Philippines are updated regularly.