Do You Need to Register Your Online Business With DTI?
Given the growing number of online businesses since the pandemic started, we compiled a quick guide to help business owners who want to know if they need to register with DTI.
According to data from the Department of Trade and Industry (DTI), the number of online sellers increased from 1,700 in March 2020 to 93,310 in January 2021. What’s more, Malaysian firm iPrice Group reported in a study that e-commerce demand in the Philippines grew by 53% and spending on said online services went up by 57%!
This just goes to show that during the pandemic, there was a boom in online businesses. In fact, you can find everything there—from food and clothes to furniture and other home necessities on Facebook, Instagram, and even in selling apps like Shopee or Lazada.
By now, you have probably seen several of these stores declaring themselves “DTI-registered” on their profiles. This—along with the regulations on e-commerce that was released by DTI themselves—has current and new online business owners asking: are online businesses required to register with DTI?
Registering an Online Business With DTI: Is There an Exemption?
So do online businesses need to register with DTI? Yes. But there are exemptions for some cases.
In general, it is required to register your business name with DTI. In fact, the department itself states, “If you are doing business using a name other than your true name, then you are required to register that business name with the Department of Trade and Industry.”
It should also be noted that registering an online business complies with Circular No. 60-2020, released by the Bureau of Internal Revenue (BIR) in 2020.
“This Circular is issued to give due notice to all persons doing business and earning income in any manner or form, specifically those who are into digital transactions through the use of any electronic platforms and media, and other digital means, to ensure that their businesses are registered pursuant to the provisions of Section 236 of the Tax Code, as amended, and that they are tax compliant,” the BIR circular states.
Circular No. 60-2020 further lists the requirements when registering with BIR. If you are an individual with a business name, you must present a DTI Certificate. What this means, in a nutshell, is that online businesses, even those run by a single person (sole proprietorship), should register with the government. However, there is an exemption to this, according to DTI.
The exemption applies to “those selling intermittently, on an irregular basis, or selling homemade stuff as a hobby during this period of the pandemic.” As these are seen as not yet in business, they are not required by the government to register.
How to Register Your Business Name with DTI
Registering your online business’s name is a simple and straightforward process. The first step is to confirm the availability of the name on the DTI website. This ensures that your business does not share the same name with an existing one run by someone else.
Once you have confirmed that your business does not have an exact match, you must fill out the registration form, which can be found on the department’s website. You will be given a reference code, which you should take note of.
Following form submission, you are then required to pay the registration fee within seven working days. The registration fee will depend on your online business’s territorial scope. Territorial scope refers to the area where the business’s office, shops or stores, plants, and other business infrastructure are located.
The fees are as follows:
- Barangay: PHP 200
- City or Municipality: PHP 500
- Regional: PHP 1,000
- National: PHP 2,000
Make sure your payment has been confirmed to ensure the registration of the name of your business.
Once you have completed the process, you may download a certificate as proof of your business’s registration. And that’s it! Your business name is now registered with DTI.
Other Things to Take Note of Regarding Your Registration
A business name registration is valid for only five years from the date of registration. This means that business name registrations have to be renewed before expiry via the DTI website.
Should you wish to have a Certified True Copy of your Certificate of Business Registration, you may request one at any DTI office. You will be required to submit the Other Business Name-Related Application Form, present a valid ID, and pay a prescribed fee.