TAX PROS & CONS OF ONE PERSON CORPORATION - Advantages & Disadvantages of OPC vs Sole Proprietorship

Tax Type:
1. Corporate Income Tax (not individual Income Tax rate) - 30% CIT
Sales 100,000
Less: Cost of Sales 50,000
Gross Profit 50,000
Less: Expenses 30,000
Net Income 20,000
Tax Rate 30%
Income Tax Due 6,000
2. Value Added Tax (Annual Sales Above P3M) - 12% VAT Rate
Sales P100,000
12% Output VAT 12,000
Less: Purchases 50,000
12% Input VAT 6,000 6,000
VAT Payable 6,000
3. Percentage Tax (3% on Sales)
Sales P100,000
Percentage Tax Rate 3%
Percentage Tax Due 3,000
4. Final Tax (10% Dividends)
Stockholder Cash Dividends 10,000
Final Tax Rate 10%
Final Tax Due 1,000
5. Donors Tax (6% if individual donor, 30% if OPC)
6. Documentary Stamp Tax
Subscribed Capital Stocks P125,000
DST P2 for every P200 2/200
DST Due 1,250
1) Who may form an OPC?
Only a natural person, trust, or an estate may form an OPC.
2) Who cannot form an OPC?
a. Banks and quasi-banks
b. Preneed companies
c. Trust companies
d. Insurance companies
e. Public and publicly-listed companies
f. Non-chartered government-owned and -controlled corporations
g. A natural person who is licensed to exercise a profession (for the purpose of exercising such profession) except as otherwise provided under special law
3) What is the minimum authorized capital stock?
•
A single stockholder may not be the corporate secretary.
5) How will the company’s affairs be managed in case of the death or incapacity of a single stockholder?
• The law requires a single stockholder to designate a nominee and an alternate nominee who shall, in the event of the single stockholder’s death or incapacity, take the place of the single stockholder as director and shall manage the corporation’s affairs. The nominee shall act as the director until the legal heirs of the single stockholder have been lawfully determined, and the heirs have designated one of them or have agreed that the estate shall be the single stockholder of the OPC. The alternate nominee shall step in as the director in case of the nominee’s inability, incapacity, death, or refusal to discharge the functions as director and manager of the corporation.
6) May an ordinary corporation be converted into an OPC, and vice-versa?
• Yes, subject to compliance with the application requirements with the Securities and Exchange Commission.
7) I am a foreign national. Am I allowed to form an OPC?
• Yes, subject to the applicable capital requirement and constitutional and statutory restrictions on foreign participation in certain investment areas and activities (SEC Memorandum Circular No. 7, Series of 2019).
8) What are the documentary requirements for an OPC?
a. Cover Sheet
b. Articles of Incorporation for One Person Corporation
c. Written Consent from the Nominee and Alternate Nominee
d. Other Requirements, if applicable:
Proof of Authority to Act on Behalf of the Trust or Estate (for trusts and estates incorporating as OPC)
Foreign Investments Act (FIA) Application Form (for foreign natural person)
Affidavit of Undertaking to Change Company Name, in case not incorporated
in the Articles of Incorporation
Tax Identification Number (TIN) for Filipino single stockholder
Tax Identification Number (TIN) or Passport Number for Foreign single stockholder
e. Filing Fees. The filing fees include the Registration Fee, Legal Research Fee, Name Reservation Fee, Documentary Stamp Fee, and the FIA Fee (if applicable).
9) How do I proceed with the application?
a. Apply for the reservation of the corporate name. To avoid the denial of your request, the OPC name must be distinct and not similar to another reserved or registered corporate name, and must not be contrary to law, public morals, good customs or public policy. “OPC” should be indicated at the end of the corporate name.
b. Submit the duly accomplished Articles of Incorporation with attached written consent of the nominee and alternate nominee and other requirements required for registration, for pre-processing.
c. Pay the Filing Fees.
d. Submit the hard copies of the signed and notarized documents together with the proof of
e. payment of filing fees at the SEC-CRMD Receiving Unit.
f. The SEC will thereafter issue the Certificate of Registration as One Person Corporation.
10) Can I register the OPC online?
• Yes. On 08 April 2020, the SEC issued a notice providing for an interim Online Registration System for an OPC and corporations with two to four person incorporators. With the Online Registration System, an applicant or his duly authorized representative may input the proposed corporate name together with its trade name/s, if any, and the data to complete its corporate profile. The applicant must provide a valid and existing email account. The SEC User Guide may be accessed here

[@EntrepDiaries]

Mr Taxpower! Thank you for sharing! Malaking tulong po!

[@mikediscipleofJesusChrist]

GALING! GALING!! sa loob pa ng kotse hehehe

[@philippineschooloftaxation3259]

Ganda ng presentation slides

[@jlalberto-tv686]

thank you mam

[@unggoytrader]

So much info thank you po.

[@philippineschooloftaxation3259]

Keep up the good work. More videos. Very informative. More powers.

[@jlalberto-tv686]

Thank you! Will do!

[@dep1912]

Sir, grabe nakakaiyak naman ung tax sa pinas. Nauunawaan ko na kung bakit galit mga negosyante sa mga corrupt na pulitiko.

[@GoodJuju-pi1vc]

thank you sir! very helpful.

[@Zyril002]

OPC and CORP is the best! don't go for sole, once na may nag reklamo about sa product nyo kung sole ka makakasuhan ka at baka makuha ang buong asset mo unlike sa OPC,CORP si company ang makakasuhan hindi ikaw so secure ang personal assets mo, kahit mahal ang babayarang tax sa opc go for it!

[@romeocastillo2441]

Ano po maganda sa apartment bussiness sa dual citizen sol prop o one man corporation

[@benjamin-fe7fp]

Yun religious churches entitled po BA SA tax

[@hmemegmeme1106]

Sir pwedi ba i-register construction firm sa opc instead na single prop.

[@ritalasdac9300]

Good day po dir ask kulang puwede po sa organization iyan at mag bayaf run po kamiposalat po

[@noodd2]

Sir thank you po sa video - posible po na ang isang sole proprietor business be owned or sold to an OPC owned by the same family??

[@paoloavetillolagustan119]

Ask lang din sir halimbawa po may paupahan ka tpos may 2 kang business isa soleprop at isa opc. Pwede po ba sir yung property under ng soleprop mo i donate mo sa opc company mo since ito ay as seperate entity para 6% lang tax mo?

[@optionsmore]

sir regarding sa percentage, kunwari nakabenta ako sa isang customer pero monthly yearly naman di naabot ang sales ko sa 3M pede ba akong lagay ng VAT doon sa mga buyer ko na na bibigyan ko ng receipt?

[@michaelang981]

3m sales po sa isang taon. mas lamang parin po ba ang sole sa tax?

[@travelsoutheastasia]

as opc can i hire myself as an imployee?

[@jmandoy8152]

hello sir.. tanong ko lang po..balak ko po kasing mag open ng business about sa construction firm(Pcab) next year 2023.. ano po ang pinakamagandang gawin ko yung sole proprietorship po or OPC na po dretso Yung kukunin ko.. para po mas maging sulit po yung desisiyon ko po ba akong gagawin.. maraming salamat po sa sagot..

[@sangeenorte8800]

Sir Thank you po dito. Sole Prop. po ako. Nag tayo po ako business last Feb2021. Meron po akong TIN under my business. Now, wala po akong kinita dahil wala parin po akong client. Pano po gagawin ko Sir? No income po ako from Feb hanggang ngayon (Sept). Baka may penalty po sya. Thank you po Sir.

[@ma.cristinaagawin311]

Sir saan po ba kayo pede magcontact kasi po may problem po saming business

[@dreamtires3075]

anu po maganda sir mag open ako ng motor parts and accesories mag sole po ba ako or OPC thanks and Godbless

[@jlalberto-tv686]

Magandang umaga po sa inyo MotorCo TV Salamat po sa inyong panonood sa aking munting VLOG. Tungkol po sa inyong katanungan kong mag open ng motor parts and accesories mag sole po ba ako or OPC? depende po ito sa requirements ninyo. pero kong sa tax pag uusapan mas ok ang OPC lalo na palapit na ang create bill na maaprobahan tiyak bababa ang Income Tax Rate. Sana po natugunan po namin mabuti ang inyong katanungan. Kong meron pa po kayo ibang mga Komento ay mag post lang po dito. Kong nais nyo po malaman at mag avail ng aming services sa “JA TAX & Accounting Firm” ay ito po ang mga sumosunod na services namin, please take note din po na dahil sa pandemya as much as possible ay ONLINE po tayo: 1. TAX COMPLIANCE 2. TAX CONSULTANCY 3. EXTERNAL AUDIT 4. OTHER COMPLIANCE For more information please visit our website at www.taxpowerphilippines.com Salamat po ng marami and god bless.

[@dreamtires3075]

@@jlalberto-tv686 salamat po sir sa sagot bali ngaun mas prefer ko po ang OPC pero may isa pa po akong tanung sa future someday allowed po ba ako mag recieved ng investor kapag naka OPC ako ?Thanks in advance

[@cesestilo5088]

Ano.po.ang requirement. Sa OPC conversion to.corporation with at least 5 incorporators?

[@michaeldegrano5607]

paano yung tulad ko na daily trader sa stock market then gusto ko magregister sa sec as opc pwede po ba yun?

[@francisrio3949]

Hello po tanong kulang po kapag nagrenta kasi kmi ng pwesto 11k buo parin ba ang ibibigay kong upa don sa nagpapa upa dipo ba bawasan ko ng 5,% ?naka witholdingtax po kasi yun.sana pp masagot mopo ako salamat po

[@nat0106951]

grabe naman taxes na yan. Pero kung wala naman kita ang sole proprietor business eh wala naman babayarang tax di ba 😅 first time registering as sole prop. hindi ko rin sure kung mag kakaprofit/client ako in my first year. 😅

[@paoloavetillolagustan119]

Sir sa income tax sa sole prop di po ba nirerecognize ang 250K annual tac exemption as individual tax payer since ikaw din nmn si sole prop

[@jlalberto-tv686]

yes po. pero depende sa range ng Income at gamit na mode tulad ng 8% or graudated income tax. pero sa one person corp ay ang tax nya ang corporate income tax na ang gamit since ito ay SEC registered

[@channexchannel3698]

Sir jame patulong po sir alin po pipiliin ko plan to open lechon manok? Tnx po sir sana masagot

[@juliepua3203]

Hi Sir mdyo nalito ako ano pong form ang gagamitin sa filing ng percentage tax for OPC,,is it the same sa single prop Bir2551Q?

[@andreicanlas497]

Boss pano po ang process ng pagconvert ng sole proprietorship to corporation?

[@emmanpagcaliwagan4308]

Pwede po bang mabawasan ang tax na binabayadan sa percentage tax. Katulad po nung sa vat. Meron syang input vat. Salamat po

[@RoyalZessy]

Sir, pag naka register sa DTI - Sole, dapt po bang cancel un bago mag register sa SEC?

[@albertborja7232]

Okay na sana. Spoken with authority. Tapos bigla nalang disclaimer as not a substitute for professional advice. In short, para may viewers lang. Bakit kelangan disclaimer kung authority ka naman at professional tax advisor kasi meron ka accounting firm naman? What is general information if not reliable? Nonsense. Besides, James L. Alberto, we should like to hear your license, qualification on why are you authority on this. Do not mind disclaimer. What is your claimer?

[@johnsarosos4776]

kung ganyan karami at laki ng taxes eh wala na ho matitira

[@midsayapbaptistelementarys7053]

Matanong kolang po PAREHO BA ANG OPC AT CORPORATION SOLE?

[@jlalberto-tv686]

MAGANDANG UMAGA PO sa inyo Midsayap Baptit Elementary School Salamat po sa inyong panonood sa aking munting VLOG at pag like sa aming FB page . Tungkol po sa inyong katanungan (TANONG?): PAREHO BA ANG OPC AT CORPORATION SOLE? (SAGOT): Magkaiba po sila in LAW and in FORM pero sa SEC ppa register. Sana po natugunan po namin mabuti ang inyong katanungan. Kong nais nyo po malaman at mag avail ng aming services sa “JA TAX & ACCOUNTING FIRM (JATAF)” ay ito po ang mga sumosunod na services namin: JA TAX & ACCOUNTING FIRM 1. HANDLING BIR TAX AUDIT 2. ACCOUNTING AND TAX CONSULTANCY 3. BIR FILING ANG PAYMENTS 4. AUDIT & FINANCIAL STATEMENTS 5. ACCOUNTING & TAXATION SEMINAR (SOON) please take note din po na dahil sa pandemya as much as possible ay ELECTRONIC/ONLINE Transaction po ang gagamitin natin: For more information please visit our website at www.taxpowerphilippines.com and email us at [e-mail] Salamat po ng marami and god bless. DISCLAIMER: This video, comment and answers are for general information purposes only and should not be considered as professional advice to a specific issue of entity. For comments or inquires please email at [e-mail]

[@lucylettepagado7313]

Sir, ask ko lang kung ano need na requirements sa SEC at BIR pag Corporate Sole ?? maraming salamat sa response :)

[@jlalberto-tv686]

MAGANDANG UMAGA PO sa inyo _LUCYLETTE PAGADO_ Salamat po sa inyong panonood sa aking munting VLOG at pag like sa aming FB page . Tungkol po sa inyong katanungan (TANONG?): Sir, ask ko lang kung ano need na requirements sa SEC at BIR pag Corporate Sole ? (SAGOT): PLEASE WATCH MY VIDEO NANDYAN PO REQUIREMENTS AND PROCESS: kzbin.info/www/bejne/qHvGhKaqZqemoMU Sana po natugunan po namin mabuti ang inyong katanungan. Kong nais nyo po malaman at mag avail ng aming services sa “JA TAX & ACCOUNTING FIRM (JATAF)” ay ito po ang mga sumosunod na services namin: JA TAX & ACCOUNTING FIRM 1. HANDLING BIR TAX AUDIT 2. ACCOUNTING AND TAX CONSULTANCY 3. BIR FILING ANG PAYMENTS 4. AUDIT & FINANCIAL STATEMENTS 5. ACCOUNTING & TAXATION SEMINAR (SOON) please take note din po na dahil sa pandemya as much as possible ay ELECTRONIC/ONLINE Transaction po ang gagamitin natin: For more information please visit our website at www.taxpowerphilippines.com and email us at [e-mail] Salamat po ng marami and god bless. DISCLAIMER: This message, videos, comment and answers are for general information purposes only and should not be considered as professional advice to a specific issue of entity.

[@nelsonbautista6571]

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