25 May 2021, 13:09 — 4 min read
Every part of the business requires a lot of work for it to be functional – from marketing, financing, accounting, to legal. It takes a lot of time and energy to build every department of the business. Registering your business is an important thing to consider also.
My tenants are always asking if they need to get their own business permits. If they need to secure one since they are just starting out. Registering your business means you are not just here for the short term. From the perspective of your customers, you are serious about offering your products and services. It's also a form of compliance that you need to be able to do business at ease in your respective local government regulator.
In my previous years, I've secured business structure as a Sole Proprietor and Corporation in Real Estate Brokerage and Development. How is it important and its benefits? I listed some of my personal experiences when it comes to the benefits of having a business license.
It shows that you are not just here for the short term but you are here to do a serious business. Having a business permit is like having a badge to show your peers that you are trustworthy in doing business with.
When you are a landlord, even if it's residential or commercial, you have to secure your business permit because you are earning via Rent or Lease Payment. It would be recorded as Rent Income. As mentioned, even if it's residential, the treatment of the Landlord would be registered as a Commercial Property Leasing in Registration and its treatment.
Business permit is one of the prerequisites when you register your business in the Bureau of Internal Revenue (BIR) to get official receipt that you can issue to your customers. Mostly, suppliers are asking for these receipts or you are the one who will issue.
Now this is the most crucial part, without having the right licenses you can be penalized by the BIR, shut down your business, or worse, imprisonment. It's an obligation as a business owner. See BIR website for more information.
Like the BIR's obligation to map if you are paying your dues or not, the Local Government Unit would also be the one who would inspect or raid your store if you don't have the right papers. The Business Permit Licensing Office would inspect your stores and force your store to shut down if you do not comply
One of the advantages or benefits of registering your business is that you can use it to borrow money from other financial institutions like SeekCap, Esquire, and First Circle. They accept non-collateralized commercial loan which differs from traditional banks that require you to produce collateral to get the liquidity you need for expansion.
In whatever industry you're in, it's still best to secure and comply to our respective regulators to do business at ease.
Image source: Shutterstock
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Disclaimer: The views and opinions expressed in this article are those of the author and do not necessarily reflect the views, official policy or position of GlobalLinker.
Posted byCarlos Payumo Garcia
I'm Carlos P. Garcia. A Landlord and Business Development and Leasing Administrator of a Mercantile Leasing (Private Market) Business. I am offering stalls for lease to...
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