classification Sole proprietorship partnership corporation cooperative

I. ownership
a. Number of One person Two or more people C corporation –unlimited Many owners
owners owners
S corporation-maximum
of 100 owners
b. Name of owners Sole proprietor members shareholders members
c. Transferability of Ownership can't be Ownership can be Ownership can be Ownership can be
ownership transferred transferred transferred transferred
II. Formation of business
a. Where to legally (DTI) the department of (SEC) securities and (SEC) securities and (CDA) the cooperative
register the trade and industry exchange commission exchange commission development authority
business
b. What are the legal  Certificate of  Name  Four copies of
documents Business Verification  Certificate of Economic
needed Registration Slip. Business Survey.
from DTI.  Articles of Registration  Four copies of
 Barangay Partnership from SEC. Duly notarized
Clearance (AP)  Barangay Articles of
Certificate.  Joint Affidavit Clearance Cooperation
 Two (2) valid of two partners Certificate. and By-Laws.
IDs. to change  Two (2) valid  A surety bond
 Proof of partnership IDs. of accountable
Address such name (not  Proof of officers.
as Contract of required if Address such  Treasurer's
Lease (if already stated as Contract of Affidavit.
rented) or in AP) Lease (if  Approved
Certificate of  Registration of rented) or Cooperative
Land Title (if data-sheet. Certificate of Name
owned)  Certificate of Land Title (if Reservation
Bank Deposit. owned) Slip.
 Name of the  Certificate of
partnership. PMES.

c. Funds needed in
order to build the
business
III. Lifespan of business
IV. profit
V. liabilities
VI. raising the capital
VII. Legal existence of the
business
VIII. Taxes imposed on the
589 pesos (10 dollars)-
5895 pesos (100 dollars)
Limited life
If the owner dies, the
business dies, as well
All profit goes to the sole
proprietor
Unlimited liability
Difficult
If the owner dies, the
business dies, as well
taxed through the
 Principal office
address.
 The contact
number of the
partner.
35 550 pesos (603 dollars)
Limited life/lack stability
Contract between
partners may be dissolved
based on agreement,
withdrawal of one
partner, death of one
partner or other reasons
for the termination of
contract
Profit is split equally or
based on predetermined
terms amongst the owner
Unlimited liability
Easier than sole
proprietorship
Depends on the
agreement
A partnership does
117 915.00 pesos (2000 294 787.50 pesos (5000
dollars) - 294 787.50 dollars)- 2 947 875.00
(5000 dollars) pesos (50000 dollars)
Unlimited life Unlimited life
Continues or more or less
permanent existence
The death or withdrawal
of some shareholders will
not affect the life of the
corporation
Profit is declared and Patronage refunds
given to shareholders are the distribution of
based on the percentage profits in proportion to
of shares use or business
volume.
Limited liability Limited liability
easiest form of easy
organization for
raising capital from
outside investors
50 years (can be 50 years (can be
extended) extended)
A corporate tax is a Cooperatives are
business personal tax return not pay federal tax on the profits of a taxed at the ordinary
of the owner via income tax at the corporation. The corporate rate on
Form 1040 entity level. The taxes are paid on a their taxable income
partnership's income, company's taxable calculated after cash
loss, deductions, income, which patronage and
gains, and credits includes revenue qualified retained
pass through to its minus cost of goods patronage and
partners. Each sold (COGS), general qualified per-unit
partner then reports and administrative retain payments. All
their distributive share (G&A) expenses, cooperatives except
of the partnership tax selling and marketing, Section 521
items and pays any research and cooperatives must
tax due, even if the development, include non-member
items have not been depreciation, and income in their
distributed other operating costs. taxable income