Book a Consultation

Tag: REBAP

  • 7 Steps to Start a Successful Real Estate Brokerage in the Philippines

    “If you want to succeed in real estate, be persistent, be passionate, and never give up.”

    –  Barbara Corcoran, American businesswoman, investor, and television personality

    By Realttorney®

    Are you are licensed real estate broker in the Philippines who is a project seller and wants to go into general brokerage to maximize all the opportunities that the real estate service sector has to offer?

    Are you a private practitioner who belongs to a branded brokerage house but is dying to establish your own real estate brokerage business?

    Finally, are you a graduating student of the Bachelor of Science in Real Estate Management in 2024 and are confident to pass the real estate brokerage examination in April 2024?

    Photo by energepic.com on Pexels.com

    Embarking on the journey to establish a real estate brokerage in the Philippines is a significant endeavor that requires meticulous planning, industry knowledge, and a commitment to ethical conduct. It is a huge endeavor, but rewarding nonetheless.

    These aspiring entrepreneurs in the real estate sector must navigate through various regulatory requirements, market dynamics, and operational challenges to carve a niche in this competitive landscape. This article outlines the essential steps to initiate and grow a successful real estate brokerage in the Philippines, focusing on practical insights and strategic considerations.

    Step 1. Acquire the Necessary Qualifications and Licenses

    All Real Estate Service Practitioners (RESPs) know this as gospel truth. No one can practice the real estate service profession without being licensed or accredited by the Professional Regulatory Board of Real Estate Service (PRBRES) according to the provisions of Rep. Act No. 9646 or the Real Estate Service Act. This means that if you are not yet licensed, then this article may not be for you to read.

    But if you are persistent and you really want to become a licensed real estate broker or an accredited real estate salesperson, then you have to acquire the necessary qualifications. To become an accredited real estate salesperson then you need to undergo a 12-hour real estate training seminar for new-entry salespersons.

    But, please remember that you need to have a minimum of 72 units of college subjects as a minimum qualification to get accredited by PRBRES. Now, if you want to be a real estate broker — because someone told you that the earning capacity is limitless — then you need to obtain a Bachelor’s degree in Real Estate Management under Section 14 (b) of Rep. Act No. 9646.

    After graduating with a degree in Real Estate Management then you need to pass the licensure examination to be conducted by the PRBRES under the supervision of the Professional Regulation Commission (PRC). Familiarize yourself with Republic Act No. 9646 to ensure compliance with regulatory standards.

    Step 2. Develop a Comprehensive Business Plan

    What? Do I need to make a business plan? Yes, of course, if you want to succeed in your latest endeavor. Let me share with you a wonderful quote from Benjamin Franklin. He said, “By failing to plan, you are preparing to fail.” It is also similar to what Winston Churchill said: “He who fails to plan is planning to fail”.

    It does not need to be a complicated business plan. Keep it simple as far as practical. But you have to cover these three critical items that would become the foundation of your entire business plan.

    The first critical item is Market Analysis. Conduct thorough market research to identify target markets, assess competition, and analyze demand-supply dynamics. In my experience, I concentrate only on real estate transactions in the Metro Tagaytay area. I just want to specialize in a particular real estate market where I can operate comfortably. Or in a class of real estate that I can handle with ease, like farmland or raw land.

    The message here is don’t be a jack-of-all-trades and master of none. One cannot effectively service the entire real estate market in the Philippines, covering all 13 or 14 regions. You have to choose your niche, your area of expertise, where you can effectively operate.

    The second critical item is Financial Projections. Prepare detailed financial projections, including startup costs, operating expenses, and revenue forecasts. But, I don’t know how to do this? Do not despair. The greatest source of information regarding this matter is at your fingertips… and it is free. If you like to read, try Google Search. If you like to listen to instructions, try YouTube. Or, call a friend who has done this or has experience in making financial projections.

    The third critical item is Strategic Objectives. Define clear objectives for the incoming year or the current year. Create the mission and vision for your real estate brokerage. Then, outline the unique value proposition for the clients and stakeholders of the brokerage.

    Find a quiet place and time where you can do your planning without interruption from your kids, spouse, or co-workers. My suggestion is to wake up 30 minutes earlier than your usual time of waking up. Use that “extra” time you have to start planning.

    Step 3. Establish a Legal Entity and Compliance Framework

    As licensed real estate brokers, it is a given that we are already registered with the Bureau of Internal Revenue (BIR). As such, if you want to venture on your own, outside the structure of your current brokerage, then we are considered independent contractors. But remember that independent contractors are considered sole proprietors in their business endeavors.

    The critical and most important act for Step 3 is to determine your Business Structure. Decide on the most suitable legal structure for your brokerage, such as a sole proprietorship, partnership, or corporation. Know the tax deductions allowable for each kind of structure, as well as the monthly, quarterly, and annual regulatory compliance with the BIR.

    If the entity you chose is a partnership or a corporation, then you also have to know the different Legal Compliance requirements for your chosen business entity. Ensure adherence to regulatory requirements, including registration with the Securities and Exchange Commission (SEC) and compliance with local government rules and regulations.

    Can you set up a One-Person Corporation to conduct your real estate brokerage? In my opinion, the answer is YES. But it is a separate article where my views on it are fully discussed.

    Step 4. Build a Robust Network and Partnerships

    I have always said in all my lectures that the real estate service sector is a relationship-based endeavor. The more you grow your network, the longer and better your career will be. But, create a high-caliber network composed of licensed real estate service practitioners (RESPs), never with colorum or pseudo practitioners.

    Cultivate relationships with real estate developers, property owners, real estate investors, and other industry experts and stakeholders. Cultivating a relationship is quid pro quo. What value do you bring to the table? What value do you offer to the other party?

    Consider being a part of a Professional Association of your choice. Of course, Section 34, Rep. Act No. 9646 mandates that all real estate service practitioners duly registered with PRBRES shall automatically become members of the accredited and integrated professional organization (AIPO) of real estate service practitioners.

    But apart from joining the AIPO, you may still want to consider joining reputable real estate associations and organizations, such as the Real Estate Brokers Association of the Philippines (REBAP), to enhance credibility and access to resources. Eventually, these current real estate service organizations will transform themselves into specialty real estate organizations to create specialized RESPs.

    If you ask: What areas of specialization are being proposed by PRBRES? At this early stage, here are the three proposed areas: (1) General brokerage, Titling, and Documentation; (2) Residential Project Selling; and (3) Foreclosed Properties. PRBRES said that these are the initial areas that may or may not be expanded.

    Step 5. Invest in Marketing and Branding

    What makes you different from all the other real estate brokers and salespersons working in your area of operation? What sets you apart from the others? Why would a seller or a buyer contact you for assistance in their real estate transaction?

    At this stage of your planning process, you need to embrace the wisdom of having a Brand Identity. Another critical component of your business plan should include developing a compelling brand identity. This includes creating a logo, website, and marketing materials that resonate with your target audience.

    How much Digital Presence do you need? Leverage online platforms, social media, and digital marketing strategies to enhance visibility and attract potential clients. Wow!! Are there a lot of things to consider? Yes, that is why planning on how to best use these strategies and implement them well is paramount.

    These are part of your marketing plan, which is a part of your overall business plan. Why is this a critical part of the plan? It is so because to put these into action, you will spend a little or more than a little financial resource. Hence, you need a plan to know how much to allocate per month to execute these important marketing tools at your disposal.

    Why do all these? As a licensed real estate broker or accredited real estate salesperson, you are considered a professional. And what sets you apart from the colorum or pseudo-practitioners who continue to dominate the market? Aside from your license or accreditation, it is a well-crafted business plan composed of the items we have so far discussed.

    Step 6. Implement Effective Operational Systems

    Now that you have your marketing strategies all planned out, you need to consider what technology you will use to streamline and automate your day-to-day operations. You have to determine how to systematize and manage your listings, site visits or orientations, client follow-ups, and transaction facilitation. There are a number and advanced real estate software and technology solutions that you (as a professional) can adopt. But, of course, this has a cost. So it is important to list this as a necessary cost of your operations.

    Team Development: Have you considered creating your own team? Recruit and train your own team of accredited real estate salespersons, ensuring alignment with your brokerage’s values and customer service standards.

    Make a handbook that will explicitly outline the mission and vision of your brokerage, the values of your organization, and the standard of service that will be experienced by your clients and/or customers.

    In the alternative, have you considered forming a super-team with other RESPs? I know of a super-team, who are members of our organization, which decided to form a corporation to synergize their efforts and resources — financial and manpower — that make their earning opportunities and capacities more efficient.

    If two brains are better than one, then probably five brains are far superior to one, correct? So, consider this carefully. It does not hurt if you find like-minded professionals who are aligned with your goals and values. This creates leverage that benefits the entire group in the end.

    Step 7. Prioritize Ethical Conduct and Professionalism

    The final step is to remind yourself that money is not the end-all and be-all of our profession. In a previous article, I argued that INTEGRITY is the most important personal quality a licensed real estate broker needs to be successful in the real estate service sector.

    Hence, it is the same thing when you want to start your own real estate brokerage. Keep your eye on our Code of Ethics. All RESPs should uphold the highest standards of ethical conduct, adhering to the Code of Ethics for Real Estate Service Practitioners to build trust and credibility. This is non-negotiable. Our long-term success is dependent on the reputation we build as a real estate service professional.

    Client-Centric Approach: We should keep in mind the needs of our clients before our own. Of course, there are exceptions to the rule, like difficult or obnoxious clients. But we should always prioritize client satisfaction, transparency, and integrity in all interactions, so we can foster long-term relationships and secure referrals for future opportunities.

    Conclusion

    Embarking on the entrepreneurial journey to establish a real estate brokerage in the Philippines requires a strategic approach, an unwavering commitment to ethical conduct, and a deep understanding of the industry landscape. By following these essential steps and continuously adapting to market trends and regulatory changes, aspiring real estate brokers can lay a solid foundation for success, driving growth, and making a meaningful impact in the dynamic Philippine real estate market.

    By adhering to the principles of integrity, professionalism, and client-centric service, real estate brokerages can navigate challenges, capitalize on opportunities, and build a reputation as trusted advisors and industry leaders.

    ——-

    Atty. Jojo is a real estate attorney, an estate planning attorney, a licensed real estate broker, and a PRC-accredited Lecturer/ Speaker for Training Programs in Real Estate. He is committed to helping new and veteran real estate service practitioners be well-informed of the latest laws, rules, regulations, and information relevant to the real estate service sector.

  • Can Aliens Inherit Land in the Philippines?

    Under the Constitution aliens may not acquire private or public agricultural lands, including residential lands…

    – Mr. Chief Justice Manuel V. Moran, Krivenko vs. Register of Deeds

    By Realttorney®

    No, we will not be discussing those non-earth beings. We are going to talk about aliens who are earthly beings belonging to a foreign country or nation. Plainly speaking, non-Filipino citizens.

    A colleague of mine sent an email requesting advice regarding her client. The part of the email is quoted as follows:

    “I would want to consult with you regarding the concern of my client. The husband is a foreigner and the wife is a Filipina. The husband’s concern is that: in case his wife passes away ahead of him, what will happen to the property (house and lot in Las Piñas City) they are buying. What is the remedy that the family of his wife will not demand right to the property leaving him helpless, they don’t have any kid.”

    I first lectured on the topic “Foreign Ownership of Land and Real Estate” in February 2011. Since more than a decade has passed, let us revisit the topic of foreign ownership of land in the Philippines and one of its exceptions.

    We’ll also revisit a 40-year-old jurisprudence promulgated by the Supreme Court and shed a new interpretation that is not commonly discussed in various online articles posted on various websites. Of course, an in-depth discussion on the Law on Succession under the Civil Code of the Philippines and how it affects the transfer of real property to foreigners who are legally married to Filipino spouses via last will and testament.

    It is a common occurrence that when an alien spouse marries a Filipino citizen, the former is the main source of funds for the purchase of a house and lot in the Philippines. Thereafter, the real property will be registered in the name of the Filipino spouse.

    As real estate brokers, we know the answer to the question: Can aliens buy land in the Philippines? As a general rule, only Filipino citizens (natural or juridical) can own land in this country. Accordingly, foreigners are not allowed to own land in the Philippines. This is a constitutional prohibition that will not be changed anytime soon.

    But every general rule has exceptions. One particular exception to the general rule written above is Section 7, Article XII of the 1987 Philippine Constitution, which is quoted hereunder:

    “Section 7. Save in cases of hereditary succession, no private lands shall be transferred or conveyed except to individuals, corporations, or associations qualified to acquire or hold lands of the public domain.”

    The case of Krivenko vs. Register of Deeds (G.R. No. L-630, November 15, 1947) eloquently discussed the purpose for the same provision in the 1935 Philippine Constitution – then Section 5, Article XIII, to wit:

    “…section 5 is intended to insure (sic) the policy of nationalization contained in section 1 [Article XIII of the 1935 Constitution]. Both sections must, therefore, be read together for they have the same purpose and the same subject matter. It must be noticed that the persons against whom the prohibition is directed in section 5 are the very same persons who under section 1 are disqualified ‘to acquire or hold lands of the public domain in the Philippines.’ And the subject matter of both sections is the same, namely, the non-transferability of ‘agricultural land’ to aliens.” (boldfacing ours, for emphasis)

    In the end, the Krivenko doctrine clearly held that “under the Constitution, aliens may not acquire private or public agricultural lands, including residential lands.” However, because of Section 7 [then Section 5, Article XIII of the 1935 Constitution] aliens are given a chance to own real estate in the Philippines. It is clear that aliens can own real estate in the Philippines through hereditary succession.

    To answer the question stated above, if the Filipina passes away before the alien spouse then the latter will be able to own a part of the real estate registered in the name of the Filipina wife through hereditary succession. Of course, this is under the assumption that the marriage between the Filipina and the alien spouse is considered legal under Philippine laws.

    But, what does “hereditary succession” actually mean? Can the foreigner own the land if it was bequeathed to him/her by the Filipino spouse through a last will and testament? And, what part of the property will the alien spouse own in the end, after the estate of the Filipino spouse has been settled?

    In layman’s terms, hereditary succession is the passing or division of an estate when a person dies without a will. It is also known as intestate succession. Therefore, the 1987 Constitution is clear that the only way an alien spouse can own real estate in the Philippines is through intestate succession. Hence, the Filipina spouse must not execute any will (notarial or holographic) during her lifetime bequeathing her real property to her alien spouse. She must die intestate. That is the constitutional edict.

    And according to various lawyer-authors, bequeathing the real property to alien spouses through a will shall be contrary to the dictates of the Supreme Court of the Philippines in the case of The Testate Estate of Jose Eugenio Ramirez vs. Marcelle Vda. De Ramirez, et al. (G.R. No. L-27952, February 15, 1982).

    However, as an estate planning attorney, I would never recommend that a Filipino pass away intestate. The default estate plan of the State is contained in the provisions of the Law of Intestate Succession – Articles 960 to 1014, and numerous provisions in Chapter 4 [Provisions Common to Testate and Intestate Successions], Title IV of Book III of the Civil Code of the Philippines. Following the estate plan of the State is not the best way to dispose of one’s properties after passing away.

    Hence, if a Filipino spouse passes away intestate and there are no other legitimate descendant, ascendant, or sibling who survives with the alien spouse, the latter will inherit the entire estate of the former. Article 995 of the Civil Code mandates this.

    According to Article 997 “When the widow or widower survives with legitimate parents or ascendants, the surviving spouse shall be entitled to one-half of the estate, and the legitimate parents or ascendants to the other half.”

    However, “should brothers and sisters or their children survive with the widow or widower, the latter shall be entitled to one-half of the inheritance and the brothers and sisters or their children to the other half.” This is provided by Article 1001 of the Civil Code.

    So, let us revisit Ramirez vs. Vda. De Ramirez to get a fresh perspective as to what other successional rights an alien spouse has based on his valid marriage to a Filipino spouse. Keep in mind that Jose Eugenio Ramirez is a Filipino, while Marcelle Vda. De Ramirez is the widow who is a French citizen. And, they had no children between them.

    The part of the decision that has been quoted numerous times by lawyer-authors in the case of Ramirez vs. Vda. De Ramirez is this:

    “We are of the opinion that the Constitutional provision which enables aliens to acquire private lands does not extend to testamentary succession for otherwise the prohibition will be for naught and meaningless. Any alien would be able to circumvent the prohibition by paying money to a Philippine landowner in exchange for a devise of a piece of land.”

    When read plainly, it seems that the Supreme Court prohibits the acquisition of land by an alien through testamentary succession for the simple reason that if allowed “the prohibition will be for naught and meaningless.” However, this is a mere obiter dictum of our Supreme Court.

    For the laymen, an obiter dictum is an opinion “uttered by the way, not upon the point or question pending, as if turning aside from the main topic of the case to collateral subjects,” or the opinion of the court upon any point or principle which it is not required to decide, or an opinion of the court which does not embody its determination and is made without argument or full consideration of the point and is not professed deliberate determinations of the judge himself. (People of the Philippines vs. Hon. Higinio Macadaeg, et al., G.R. No. L-4316, May 28, 1952)

    Why do I say that this pronouncement of the Court is a mere obiter dictum? The pronouncement was made while the Court was discussing the “appellants claim that the usufruct over real properties of the estate in favor of Wanda [the companion of Jose Eugenio Ramirez, who is an Austrian] is void because it violates the constitutional prohibition against the acquisition of lands by aliens.”

    The next paragraph in the decision is very telling, and I quote:

    “This opinion notwithstanding, We uphold the usufruct in favor of Wanda because a usufruct, albeit a real right, does not vest title to the land in the usufructuary and it is the vesting of title to land in favor of aliens which is proscribed by the Constitution.”

    So, the ruling of the Supreme Court as regards the usufructuary rights bequeathed to Wanda via testamentary dispositions of the testator (Jose Eugenio Ramirez) was upheld. And in the own words of the Court, that often-quoted pronouncement stated above is a mere opinion. And thus, it is a mere obiter dictum.

    Another reason why the often-quoted pronouncement is an obiter dictum is the final distribution of the estate of Jose Eugenio Ramirez in the dispositive portion of the decision of the case. The testamentary disposition of Jose Eugenio Ramirez to his wife (Respondent Marcelle D. Vda. De Ramirez) was increased to one-half of the estate (which included land and its improvements) in full ownership because the testator’s original disposition impaired the widow’s legitime.

    Article 886 of the Civil Code states that a legitime is that part of the testator’s property which he cannot dispose of because the law has reserved it for certain heirs who are, therefore, called compulsory heirs. Meanwhile, Article 887 (3) identifies the widow or widower as a compulsory heir of a testator.

    So, we can correctly state that the Supreme Court allowed the testamentary disposition of the testator to his alien legal wife, who is a compulsory heir, and upheld that the legitime of the alien wife (as compulsory heir) over the entire estate should not be impaired based on Article 904, first paragraph of the Civil Code.

    Article 900 of the Civil Code of the Philippines states: “If the only survivor is the widow or widower, she or he shall be entitled to one-half of the hereditary estate of the deceased spouse, and the testator may freely dispose of the other half.”

    And, since the alien spouse survived the deceased, he shall be entitled to one-half of the estate over which the Filipina spouse cannot impose a burden, encumbrance, condition, or substitution of any whatsoever. Why is this so? Based on Article 904, paragraph 2, the testator cannot impose upon the compulsory heir “any burden, encumbrance, condition, or substitution of any kind whatsoever.”

    Also, take note that the brother and/or sister is not a compulsory heir of the Filipino spouse. But, the legitimate ascendants (parents and/or grandparents) are compulsory heirs pursuant to Article 887 (2) of the Civil Code.

    As a consequence, “if the testator leaves no legitimate descendants, but leaves legitimate ascendants, the surviving spouse shall have a right to ¼ of the hereditary estate.” (Article 893, Civil Code) The one-fourth shall be taken from the free portion of the estate. Meanwhile, according to Article 889, “the legitime of legitimate parents or ascendants consists of ½ of the hereditary estate of their children and descendants.”

    Therefore, if the alien spouse and a legitimate parent survive the testator then the former is allowed to have ¼ of the estate as legitime and the legitimate parent is entitled to ½ of the estate as legitime as well.

    Hence, regardless of what is the legitime of the alien spouse, we should be aware that an alien can own land in the Philippines through a testamentary disposition from a Filipino spouse, whose marriage is valid under Philippine laws. I dare say that this is an addition to the constitutional exception to the general rule discussed above.

    And if I may posit an obiter of my own, any testamentary disposition of a Filipino testator to an alien who is NOT a compulsory heir of the testator comes under the ambit of the constitutional prohibition disallowing aliens from owning lands in the Philippines.

    In summary, we learn from the case of Ramirez vs. Vda. De Ramirez, that any testamentary disposition by the Filipino spouse to the alien spouse should not be less than one-half of the entire estate if they have no child. Remember, the legitime of the alien spouse, as compulsory heir, should not be impaired.

    But, what about the free portion of the estate of the testator? Can the Filipino spouse bequeath the free portion, in this case, the remaining one-half of the estate to the alien spouse? Or the remaining one-fourth if the widower survives with the parents of the Filipino spouse?

    That would be another discussion at some point in the future.

    I hope I have fully answered the question of my colleague and sincerely hope that their buying decision can be guided by this article. And I end by quoting the decision in the same Krivenko case mentioned above, to wit:

    “aliens are not completely excluded by the Constitution from the use of lands for residential purposes. Since their residence in the Philippines is temporary, they may be granted temporary rights such as a lease contract which is not forbidden by the Constitution. Should they desire to remain here forever and share our fortunes and misfortunes, Filipino citizenship is not impossible to acquire.”

    Happy selling to my fellow CRBs of the Real Estate Brokers Association of the Philippines, Inc. (REBAP). God bless all licensed and accredited Real Estate Service Practitioners in the Philippines.

    ——-

    Atty. Jojo is a real estate attorney, an estate planning attorney, a licensed real estate broker, and a PRC-accredited Lecturer/ Speaker for Training Programs in Real Estate. He is a Chartered Trust and Estate Planning (CTEP®) professional who is committed to educating Filipinos about the value and importance of having an estate plan in their lives.

  • REMINDERS AS 2022 ROLLS IN

    “By the taxes he pays, a citizen has every right to demand for a good and honest government.”

    – Franklin D. Roosevelt

    By Realttorney

    Portions of the contents of this article were first published 4 days before its 10th year anniversary – January 12, 2012. It is updated to share the same message to all new and old real estate service practitioners (RESPs) – salespersons, brokers, appraisers, government assessors and consultants of their obligations as professionals.

    I wish all licensed RESPs a prosperous and abundant 2022. If we are to believe the “experts” and analysts the real estate industry looks brighter for this year due to the continued vaccination program of government, as the Philippine economy slowly rises up from the pandemic-induced negative growth in 2020.

    The boom in the demand for luxury and mid-income residential projects, both in the vertical and horizontal project, means more opportunities for RESPs earn more income in 2022. So, how do we prepare for a better and prosperous 2022?

    As the New Year is upon us already, I wish to outline some reminders that need to be performed by all old and new licensed RESPs pursuant to Republic Act No 9646 and its Implementing Rules and Regulations (IRR).

    First, in Section 38, Rule IV of the IRR “Real estate service practitioners shall be required to indicate the certificate of registration, professional identification card, Privilege Tax Receipt (PTR) number, AIPO membership and/or receipt number.”

    Therefore, all licensed RESPs should get a PTR. It cost around P300.00 and you can get this at your Office of the Treasurer of your LGU. Just say that you will get a PTR when you stand in front of the transaction window of the Treasurer’s Office of the.

    What must you bring with you when you apply for a PTR? For veteran RESPs, a photocopy or the original of the PTR of the previous year will suffice. For the new salespersons and brokers, you need bring a photocopy of your Certificate of Registration and the PRC ID Card with you.

    It should be noted that the Privilege Tax Receipt mentioned in the IRR is the same as the Professional Tax Receipt mentioned in the Local Government Code. For real estate salespersons, if the PTR is unavailable in your LGU please ask for the Occupational Tax Receipt (OTR).

    Second, if you are already registered with the Bureau of Internal Revenue (BIR) then you should pay your annual registration fee of P500.00 using the BIR Form 0605. You can remit the payment at the BIR Revenue District Office (RDO) that you registered in or at the Authorized Agent Banks of the concerned RDO.

    Now, if you are still not registered with the BIR then you must do so in order to be compliant with the National Internal Revenue Code of 1998, as amended. It is also our obligation to follow the laws of the Philippines as mandated by the Code of Ethics and Responsibilities promulgated in PRBRES Resolution No. 39, Series of 2019. Hence, BIR registration is a must for all licensed RESPs.

    I will quickly outline below, the steps to register with BIR as a self-employed individual (professional):

    STEP 1: Secure and fill up BIR Form 1901 – Application for Registration for Self-Employed and Mixed Income Individuals, Estates/Trusts.

    STEP 2: Submit the same with the following documentary requirements to the RDO having jurisdiction over the place where you hold office – it could be a home office or a commercial office space.

    Documentary Requirements:

    1. Birth certificate (Original and photocopy);
    2. Marriage certificate (Original and photocopy); and
    3. Birth certificate of children (Original and photocopy);

    Other documents for submission, if requested:

    1. Mayor’s Permit (Original and photocopy);
    2. Contract of Lease (if renting);
    3. Title/Tax Declaration & SPA/Affidavit of Consent if the location is not owned by applicant (if not renting); and
    4. Sketch of location.

    STEP 3: Pay the Annual Registration Fee (P500.00) at the Authorized Agent Banks of the concerned RDO.

    STEP 4: Pay Documentary Stamp Tax (DST) [loose DST / BIR Form 2000 for DST on Contract of Lease, etc.). Present proofs of payment upon submission of the documentary requirements.

    STEP 5: Submit requirements for Authority to Print (ATP) and registration of books of accounts.

    Documentary Requirements:

    1. Accomplished BIR Form 1906;
    2. Job order from the printer;
    3. Final and clear sample of receipt and invoices (machine printed);
    4. Photocopy of Taxpayer Identification Number Card; and
    5. Photocopy of BIR Form 0605 (payment of registration fee).

    Book of Accounts:

    1. Cash Receipts;
    2. Cash Disbursement;
    3. Ledger;
    4. Journal;
    5. Subsidiary Sales Journal; and
    6. Subsidiary Purchase Journal [last 2 are additional books for VAT Taxpayer].

    STEP 6: Attend the taxpayer’s initial briefing to be conducted by the RDO concerned for new registrants in order to apprise them of their rights and duties/responsibilities as taxpayers.

    STEP 7: Wait for the RDO to issue the Certificate of Registration (BIR Form 2303) together with the “Ask for Receipt” notice, Authority to Print and Books of Accounts.

    For a more comprehensive discussion on the steps enumerated above including the related revenue issuances promulgated by the BIR and codal references in the National Internal Revenue Code can be found in the BIR website (www.bir.gov.ph).

    A final reminder to all new salespersons and brokers reading this article. The tax code states that “all individuals engaged in trade or business shall accomplish and file the application on or before the commencement of business operation or from the day the first (1st) transaction occurred or within thirty (30) days from the application with the LGU for issuance of Mayor’s Permit/Professional Tax Receipt (PTR), which ever comes earlier.”

    I encourage newly accredited salespersons and newly licensed real estate brokers to register with the BIR. Furthermore, the Code of Ethics and Responsibility mandates all RESP to register with the BIR. In 2005, Atty. Alexander L. Lacson published his book “12 Little Things Every Filipino Can Do To Help Our Country.” You can buy a copy of his book at his website at www.alexlacson.net.

    “PAY YOUR TAXES” is the 10th Little Thing he listed. I quote some portions of what he wrote in pages 75 – 80, which resonates the same message today as if it was written 17 years ago:

    “Of the many duties of a citizen under our Constitution, paying taxes is one of the most crucial. Because taxes are the lifeblood of our government, of our nation.

    “It is what we use to buy the basic textbooks for our millions of children in the country, or to build additional classrooms in public schools nationwide…

    “Taxes are what we use to buy the most basic of medicines, often generic and cheap, that our Department of Health officials distribute to 34 million Filipinos nationwide who live below the poverty line.

    “It is what we use to pay all our government employees nationwide – our soldiers, our policemen, our public school teachers, among many others.

    x     x     x

    “Viewed in this light, the taxes that you and I pay are actually not lost or wasted completely. A substantial portion of the taxes we pay is still put to good use. Because there are many public servants – not only a few or some – who still do their jobs properly. There are many of them, these honest and faithful ones, but maybe many of them are just in the rank and file, like you and me.

    “But they are there. Among the silent many who hold the center and keep our government from falling apart. They are the ones who keep our public institutions intact through storms and scandals, notwithstanding the misguided ambitions and corruption of some of their leaders.

    “It is for this reason that we should continue paying our taxes. The good ones in the government are still good reason for us to continue paying our taxes properly. The challenge for us is just how to increase the number of these good ones in government.

    x     x     x

    “In 2003, P83 Billion was collected from individual income taxes. But 91% of this amount came from salaried workers from the government and private sector, people who have no choice since their income taxes are withheld mandatorily. Only P7 Billion of P83 Billion (or 9%) came from businessmen and professionals like doctors, lawyers, accountants, architects, and dentists, among others.

    x     x     x

    “Can you imagine if our businessmen and professionals pay more income taxes? Or if our government is able to collect 21% this year instead of the 14.1% last year, because we all decided to pay 50% more of taxes this year? This means that our government will have more funds to perform its duties and obligations to the public.

    x     x     x

    “But we have to pay our taxes properly. Because we all live in the same country. Because this government, whether we like it or not, is our government. Its cost is a burden we must all share. The task of building this nation is a task that we all must share. We all must contribute to build this kind of nation we dream for ourselves. Each one of us has a role in it. Each one of us has a responsibility to it.”

    Third, and final reminder, concerns real estate salespersons and brokers who engage in project selling. If it is your cup of tea to sell subdivision and condominium projects then you are mandated by Presidential Decree No. 957 to register with the Department of Human Settlements and Urban Development (DHSUD), pursuant to existing rules and regulations.

    Similar to securing a PTR, the Certificate of Registration must be renewed annually. You can apply at the Main office of DHSUD in Quezon City or at its Regional Offices nearest you place of residence. For licensed real estate brokers wanting to do project selling for the first time or those who are renewing their certificate of registration, kindly prepare for submission the following: (1) photocopy of your PRC ID Card, Certificate of Registration from PRC; (2) previous year’s Official Receipt; (3) recent 2 X 2 ID picture; and (4) surety/cash bond. If you are lucky to have been issued an ID Card by DHSUD then a copy of it can also be submitted. The registration fee is P720.00 if renewed prior to expiration.

    Meanwhile, for newly accredited salespersons or those wanting to renew, you need to submit the following: (1) duly accomplished application form – which can be downloaded from the DHSUD website; (2) recent 2 X 2 ID picture; (3) copy of the PRC-issued accreditation card, or PRC-issued O.R. or the claim stub; (4) cash/surety bond; and (5) the Letter of Engagement/Employer for the Broker with these attachments – copies of the PRC ID card of the broker, the DHSUD ID card and the listing of accredited salespersons from PRC under the broker’s name. The registration fee is P288.00 if renewed prior to expiration.

    I hope this is useful to you all as we welcome 2022. Happy New Year once again.