My most recent project since moving to my hometown was to establish Sprout Up Bohol as the grassroots organization that activates Bohol’s technology community by hosting monthly workshops and events. As of this writing, we’ve hosted thirty-five community events and one Startup Weekend (another one is happening this August 2024!) in our almost two years of operations.
This blog post documents our lessons learned in our journey of officially registering Sprout Up Philippines Incorporated which has allowed us to issue official receipts, work with larger partners and organizations for our programs, and be confident in expanding our operations (when the time comes).
If you would rather have someone else process your organization’s SEC and BIR registration, you can check if your locality has an office similar to the Bohol Investment and Promotions Center.
Incorporators and Trustees
I’ve always been in the camp of never starting alone. One, it is a lot easier to bear hardships with a support group, and two, it’s a form of validation: is this effort addressing a problem important enough for people to want to act on it and join a cause aimed at solving it?
For our organization, we had two incorporators and two trustees; four key people in total. It’s important to identify who is the President and Chairman for either group as that person will be the main signatory for many documents. The Secretary and Treasurer are also important signatories, but these roles can be assigned to the same person or the President themselves.
We started with ten thousand pesos (₱10,000.00) as capital, but you don’t really need this amount for registration. Note that this amount impacts your registration fee with SEC eventually.
Contact Details and Business Address
For our case, I set up a separate email address at hello@sproutupbohol.com to work as our corporate email and used a phone number that I have access to as our corporate contact number. It’s important that you have access to both these lines of communication beacause verification messages get sent here as you progress through eSPARC’s system (SEC’s online registration platform).
The business address, in our case, is an address that I have access to and is an address where parcels can be delivered. If you do not intend to have a physical office given the type of operations you’re planning to run, setting this address to a home address is perfectly fine. Just make sure that there is someone available when SEC sends their courier partner to deliver the physical copy of your Certificate of Incorporation after finishing the registration process.
Registering with SEC
The process can be done totally online, just make sure you have access to a scanner and a lawyer because you will be scanning a lot of documents that need to have been notarized.
There are three key documents you need to prepare:
- Cover Sheet
- Articles of Incorporation
- By-Laws
Each of these documents needed to be notarized by a lawyer and we spent about one thousand pesos (P1,000.00) to have this set notarized.
Note that more documents will be required if you register as a Foundation, but I doubt many community organizations qualify for this as this requires the organization to have one million pesos (₱5,000,000.00) or more in contributions.
The SEC publishes a lot of material on how to navigate their online registration platform. Viewing this video before you begin your registration process will save you from making a lot of mistakes:
Notes from our experience:
- Once you prepare the above three documents, you will need to submit them for review. The reviewer is someone who works at the indicated SEC office you selected at the beginning of your registration process. Since we are based in Bohol, we chose the Cebu Extension Office.
- After multiple rounds of review, apparently, Sprout Up Bohol’s activities fall under Industry Code S949: “Activities of other membership organization“
- The “corporation purpose” description for our Articles of Incorporation document took forever to finalize. Apparently, it has to be very specific and descriptive which ended up with us having an almost roundabout and constrained description of what we do as an organization. Below is what we ended up having approved:
To conduct events and programs that empower the local digital economy in non-metro areas in the Philippines and to support grassroots communities in line with the mission. To help develop the skills of individuals (freelancers, creatives, developers, makers, content creators, etc.) and further the growth and education of small to medium-sized business owners (dev shops, 3D art and modeling shops, software development outsourcing companies, etc.). The skills to be improved across various planned programs include, but are not limited to, graphic and visual design skills using industry software such as Figma or Adobe XD, proficiency in industry software development tools and languages such as Kubernetes and ReactJS which allows for better mobile app and website development, improvement in public speaking and pitching to improve the rate of success when making partnerships, social media marketing and content creation proficiency to better utilize new-age marketing standards such as Search Engine Optimization (SEO) and taking advantage of algorithms present in social media platforms to increase digital business’ sales, and other relevant skill sets of the target demographic to be served.
The registration fee after submitting all your documents can cost somewhere around five thousand pesos (₱5,000.00) depending on your initially declared capital amount.
After our application package was approved, we received digital copies of our approved documents but we had to wait for the courier to send the actual documents. At the time of our application, we needed to also make sure we submitted the details requested by the MC28 Annex D within the requested timeline.
Right after receiving your SEC document, we recommend that you do not make the same mistake as us and immediately apply for your BIR registration. We didn’t know there was a time limit and ended up registering for BIR at around 3 months after securing our SEC registration. We paid a then thousand pesos (₱10,000.00) fine due to this.
Registering with BIR
This process took the more traditional route for us where one of my co-founders had to physically go to our local BIR office and process our necessary documents. He needed all of our SEC-approved documents alongside the following:
- Board Resolution that communicates the organization’s intention to register to the BIR and that it is authorizing him to conduct this process
- BIR Form 1903 (the BIR application form)
These documents also needed to be notarized before submission to the BIR so we spend another one thousand pesos (P1,000.00).
After you line up and get yourself processed at the counter, they may ask you to come back after three days or a week depending on the office. You should be able to get the Certificate of Registration in your next visit if the BIR finds no issues with your application. I don’t recall if there was a registration fee for the BIR, sorry!
We then needed to process for the printing of our official receipts or sales invoice which can only be done at a BIR-accredited print shop. We paid about one thousand pesos (₱1,000.00) to get a stack of 4 receipts and the print shop was right outside the BIR office.
Compliance
To maintain your registration to SEC, you have to make sure you process your annual submissions in a timely manner. Depending on the organization, you will see a list of documents at the back of your Certificate of Incorporation which lists what document and when do you need to submit them.
For the BIR, you just have to make sure you file your taxes on time. For the fiscal year of 2023, we paid a total of about six thousand one hundred seventy one pesos (P6,171.55) in taxes. I think this amount could have been smaller but we were still inexperienced. Hopefully, we manage to file things correctly and with the right timing to reduce this amount.
For the SEC requirements, we spend about five thousand pesos (₱5,000.00) annually for our accountant who has to prepare our Annual Financial Statements, which will be a lot easier to process if you make sure to collect your receipts for expenses and note any kind of income your organization receives, from donations to event registration fees.
We work with an amazing bookkeeper here in Bohol who helps us keep track of everything and makes sure we submit things on time. We pay her around one thousand five hundred pesos (₱1,500.00) quarterly.
For the BIR requirements, we subscribe to Taxumo’s 2-year SME plan at around nineteen thousand pesos (₱19,000.00) every 2 years. This has made tax filing tremendously simple and even our bookkeeper enjoys prioritizing us as clients as it’s a completely no-hassle experience for her when working with us.
Hope these details help give you an idea of how registration (and the operations needed to keep your registration afterwards) can look like for you and your organization!
Ashley Uy 
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