BIR Business Renewal 101: A Step-by-Step Guide

Any business owner will tell you that the BIR business renewal process is meticulous but necessary for a solid business plan. The Bureau of Internal Revenue (BIR) requires all businesses to renew their BIR Certificate of Registration to permit legal operations. In other words, your business can’t legally exist without an updated BIR certificate. 

Failure to complete the BIR business registration renewal by the deadline could result in severe penalties. Section 258 of the National Internal Revenue Code says you’ll be required to pay a minimum fine of ₱5,000 and be imprisoned for at least six months. 

Moreover, your operations would become illegal, jeopardizing your employees, customers, and all stakeholders. It’s why renewing early is critical to your business’s longevity.

Whether you’re going through the BIR business renewal process for the first time or need a refresher, this article guides you on accomplishing your annual renewal requirements. The process is fairly straightforward and can be broken down into steps. 

A Step-by-Step Guide on How to Renew BIR Business Permit

Renewing your business registration can feel overwhelming because of the additional steps in procuring other necessary permits. Breaking down each permit into smaller steps can lessen your hassle, stress, and even anxiety. Gain clarity on the renewal process by following the steps below.

Step 1: Secure a barangay permit

Your barangay permit tells the BIR that your local government unit (LGU) approves of how you’ve brought your profitable business idea to life and that you comply with its regulations.

Requirements for obtaining your barangay permit:

• Original and photocopy of your previous year’s barangay clearance 
• Original and photocopy of the prior year’s official receipt 
• Two copies of the completed barangay application form (available at your local barangay hall)
• Requirements listed in your LGU’s permit application form

1. Complete and submit the application form along with the required documents
2. Pay the corresponding fees (typically around ₱200, but it can vary depending on your barangay and business type and size)
3. Receive the barangay permit or clearance, which you’ll need to renew after its expiration date on January 20

Before visiting your barangay office, check the validity and accuracy of your documents to avoid any unnecessary returns. After ensuring your documents are in order, consider lining up early to avoid long queues and delays. 

Don’t toss the receipt upon receiving your barangay permit. Keep copies of it and the permit for future reference. 

Step 2: Secure the mayor’s permit

The mayor’s permit is essential for legally operating your business within your city’s jurisdiction and qualifying for certain local benefits.

Common documents needed to secure your mayor’s permit:

• Renewed barangay permit
• Original mayor’s permit from the previous year
• Original official receipt from the previous year
• Income statement from the previous year
• Lease contract from the previous year
• Local insurance 
• Community Tax Certificate from City Hall 

1. Complete and submit the application form along with the required documents
2. Pay the corresponding fees
   • The cost of renewing your mayor’s permit can vary, including financial obligations like business tax, license fees, garbage fees, signboard fees, and more.
3. Receive the mayor’s permit or license, which officially expires on January 20 

A mayor’s permit is also what you need to qualify for various business financing products, like working capital loans and government business loan. You can apply for this permit online or through designated kiosks or centers near you. As a standard tip, keep copies of your receipt and permit for future reference.

Step 3: Secure BIR business registration certificate renewal

Your BIR Certificate of Registration is necessary for declaring and paying taxes and helping you avoid penalties and fines.

The requirements are similar to those for your initial registration, which include:

• Renewed barangay permit
• Renewed mayor’s permit
• BIR Renewal Form 0605

1. Prepare and fill out BIR Form No. 0605

The BIR Renewal Form 0605 is the main document to renew your business registration. You can use the Electronic BIR Forms (eBIRForms) package to prepare and fill out your required documents.

Alternatively, you can download and print your BIR Renewal Form 0605 from the official website. Print at least four copies of your BIR Renewal Form 0605 if you plan to make an in-person payment at an authorized bank.

2. Pay the Annual Registration Fee (ARF) and Documentary Stamp Tax (DST) online

The ARF is ₱500, while the DST varies depending on your business’s finances. The BIR requests cash payments for amounts below ₱20,000, while those above should be done through the Manager’s or Cashier’s check at your designated Revenue District Office (RDO).

The BIR allows multiple ePayment channels, including GCash, Maya, and Landbank Link.BizPortal to provide convenience for settling your ARF and DST.

3. Attach all required documents in an email and submit

You must submit all your requirements to the email address of your designated RDO, which should be the RDO closest to your registered business address. 

4. Receive an email acknowledgment of your application

Typically, the designated RDO will respond with an acknowledgment and receipt of your application. This confirms the receipt of your documents and places your application in the processing queue. Look for an email from ebirforms-noreply@bir.gov.ph.

5. Receive an email notification of approval or disapproval of the application

Your designated RDO should notify you whether they approve or reject your renewal application. 

Remember: Your business permit has an annual expiration date of December 31. You have only 31 days to fulfill your BIR business permit renewal. Applying past the deadline, which is January 31 of the next year after your permit’s expiration date, will mean penalties and fees. 

Since prompt action is necessary, it helps to regularly check your emails for application status updates. Once you see it’s accepted, promptly print and conspicuously display your BIR Certificate of Registration on your business’s premises. Restaurants, for example, often place their certificate by the cashier to notify customers of their legitimacy.

Frequently Asked Questions (FAQs) on BIR Business Permit Renewal 

• When is the deadline for BIR business renewal?
  • You must apply for business renewal before January 31.
• How long does it take to renew the BIR business registration?
  • Setting aside around three weeks for the renewal process is best, with each week dedicated to securing each permit. However, the actual time may vary depending on the volume of businesses applying and government processing times. 
• What if I lost or damaged my BIR Certificate of Registration?
  • According to the BIR, you may visit the Online Registration and Update System (ORUS) to generate an electronic certificate. You may also complete Form 1905, Application for Registration Information Update, and submit it with an affidavit of loss and your old TIN card if it was damaged.
• How can I update or change my business information with BIR?
  • You must complete BIR Form 1905 and submit it to your local RDO.

Stay in the Game a Year Longer

It’s important you renew your BIR business registration early, especially given the current business loan trends. Early renewal can give you a competitive advantage, as you’ll be ahead of the pack in applying for Philippine business loans.

Paying the BIR renewal fee and having your BIR form for business renewal approved means your business can legally operate for another year. Although securing your barangay and mayor’s permit can be tedious, the benefits of renewing your business permit are well worth it. 

Proactively renewing your BIR business permit doesn’t only help you avoid penalties, but it also enables you to start the year earlier than your competitors. What growth do you intend to achieve in the new year? You can propel your organization further when you leverage business loans in the Philippines. 

Zenith Capital provides business loans that can be processed within three to five business days and hassle-free business loan repayment, supporting your strategies for the new year. Contact us to learn more.

Rizza Templonuevo

Rizza Templonuevo is not just an accomplished finance professional and business leader, but also a loving wife and a dedicated mother of two. With a passion for helping businesses grow and thrive, she brings her extensive knowledge and expertise as Vice President of Zenith Capital Credit Group Corporation to help countless SMEs and corporations across the Philippines access the financing they need to succeed.

When she’s not busy with work, Rizza enjoys immersing herself in the worlds of fashion and social events, as well as traveling to new and exciting places.