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Questions regarding corporations

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1 Questions regarding corporations on Thu Dec 31, 2015 11:11 pm

SethDamien


Arresto Menor
Hi, Just a few questions in taxes and initial fees on registering a corporation. Please Bear with me.

1.) how much should i expect to spend when registering a corp?

2.) How are corporations taxed?
-Is it through company income? or individually by dividend shares a-la income tax? or both?
-In Philippine law, is there an option to file a corporation under S-corp?

3.) If the company failed to yield profit, are the owners still obliged to pay income taxes?

4.) Lastly, is there a minimum "maintaining balance" required to keep a corp registered?
-The business im planning can definitely run with no monetary capital. Are financial statements something i should worry about?

Thanks! any input would be much appreciated

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2 Re: Questions regarding corporations on Fri Jan 01, 2016 1:40 am

Lunkan


Reclusion Perpetua
(I know only SOME about corps, because I will more likely start a BMBE. Why do you want to have a corp instead? Smile


If I remember corect:

1. Minimum 5000p start capital + ? p registration fee,

2. Beside VAT, property tax and such:
FIRST the company pay tax at the taxable income. (I believe 30 %.)
(Some simplified) THEN owners pay tax at what they get by dividends or work pay similar to if being shareholder or employee in any business,

3. It's a MINIMUM tax for the company at 2 % of the REVENUE if that's higher than the tax at the taxable income for the company.

4. IF I underrstand your question corect:
I BELIEVE ithe assets need to be worth minimum 5000p to be allowed to continue.

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3 Re: Questions regarding corporations on Fri Jan 01, 2016 12:57 pm

SethDamien


Arresto Menor
Thanks @lunkan!

Im curious about the BMBE, does it work the same way a corp does? How much assets are needed to maintain for BMBE?
and also, is it tax exempt?

Regarding #2
There are two types of corporate set-up, the C-corp and the S-corp.
-C-corp is when company sales are taxed in addition to shareholder/employee tax. Basically, you are taxed twice like what you mentioned.
-S-corp is when only the shareholder/employee income tax is paid.

obviously i dont want to have to pay twice... is there such an option to register my business as an S-corp here?

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4 Re: Questions regarding corporations on Fri Jan 01, 2016 8:31 pm

Lunkan


Reclusion Perpetua
BMBE is much different from corporation.
There are some demands needed to fullfil to be approved as BMBE for instance it can't be a part of something biger as for instance a franshise. It's decided by your local barangay/municipaly office, so they can tell you the details. The registration fee is nothing or very litle.
BMBE has some benifits. One very good is the INCOME for the OWNER is tax free. Other taxes are the same.

I don't know anything about S-corps.
(But one of my business ideas need a solition where each partner/investor pay tax at their own part of the result, without the joint part need to pay tax. So I will try to find if I find S-corp can function Smile

Edit: Now I know about S-corps Smile But I haven't found if there are such in the Philippines.

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5 Re: Questions regarding corporations on Fri Jan 01, 2016 9:50 pm

Lunkan


Reclusion Perpetua
According to some short texts shown when searching Republic Act 8424 SEEM to have to do with that S-corps.
But when I tried to look that up, the link show an EMPTY page at http://lawlibrary.chanrobles.com/index.php?option=com_content&view=article&id=78850:republic-act-no--8424&catid=93&Itemid=738 Perhaps it will function when you read this Smile

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