Heads up, business owners, freelancers, and side hustlers!
The Bureau of Internal Revenue (BIR) has just raised the stakes for tax compliance.

Through Revenue Memorandum Circular (RMC) No. 55-2025, the BIR clarified how Section 24 of Republic Act No. 12214 (Capital Markets Efficiency Promotion Act) amends Section 258 of the National Internal Revenue Code (NIRC), making doing business without registration a criminal offense.

And yes, it’s as serious as it sounds.

What the Law Says (Effective 2025)

Under Section 258, any person found doing business without registering with the BIR under Section 236 will face:

• ₱5,000 – ₱20,000 fine, and
• Imprisonment of 6 months to 2 years

If the unregistered business involves excise-tax goods (such as distilling, compounding, repacking, or manufacturing alcohol, tobacco, fuel, or similar products), the penalties increase to:

• ₱30,000 – ₱50,000 fine, and
• Imprisonment of 2 – 4 years

Importantly, this penalty applies to those who failed to register their business, not to those who simply forgot to pay the old ₱500 annual registration fee. That fee was already abolished under the Ease of Paying Taxes Act (R.A. 11976).

Who Is Affected?

You might be surprised how many people fall under this rule.
You could be unintentionally violating the law if you are:

• An online seller or content creator earning income but not registered with the BIR
• A freelancer or consultant issuing receipts or invoices without a BIR permit
• A small business owner with a sideline who never applied for a TIN or Certificate of Registration

Under the new clarification, “ignorance of the law” is no longer a defense. If you earn income from business or self-employment without BIR registration, it’s now considered an unlawful pursuit of business, a punishable crime.

What You Should Do (Before It’s Too Late)

Here’s how to stay compliant and avoid legal trouble:

1. Register with the BIR under Section 236 of the Tax Code.
   Secure your Certificate of Registration (BIR Form 2303).
2. Issue Official Receipts or Invoices using BIR-authorized printers or e-receipting systems.
3. File your returns on time, even if your income is zero for the period.
4. Keep your books of accounts properly maintained and updated.

These steps are not just about paying taxes, they’re about ensuring your business operates legally and credibly.

Why This Matters

Think of registration as your business passport, proof that you’re operating legally in the Philippines.

Without it, you risk fines, jail time, and even disqualification from future business permits or government programs.
More importantly, it builds trust with clients, suppliers, and banks who often verify a company’s BIR registration before any serious transaction.

Bong Corpuz & Co. CPAs’ Tax Tip

“BIR registration is not about paying ₱500, it’s about being legally recognized to operate.”

RMC 55-2025 makes it clear: Registration is non-negotiable.
Don’t wait until you receive a notice or a penalty letter.
Let’s make compliance your advantage, not your problem.

Need Guidance?

Our team at Bong Corpuz & Co. CPAs can help you register properly, choose the right business structure, and stay compliant with the latest BIR updates.

Serving entrepreneurs, professionals, and growing businesses since 2019.
Let’s keep your business compliant, credible, and criminal-free.