Incentives and Benefits

Income Tax exemption from income arising

from the operations of the enterprise
Exemption from the coverage of the
Minimum Wage Law (BMBE employees will
still receive the same social security and
health care benefits as other employees
Priority to a special credit window set up
specifically for the financing requirements of
BMBEs; and
Technology transfer, production and
management training, and marketing
assistance programs for BMBEs
beneficiaries

Income tax exemption

What are the steps in availing the
income tax exemption?
1. Register with the BIR Revenue
District Office (RDO) where the
principal office or place of business
is located
2. Submit the necessary documents

Income tax exemption

What are the documents to be submitted to the
BIR to avail of Income Tax Exemption?
1. A copy of the BMBEs Certificate of Authority
2. Sworn Statement of Assets of the BMBE and/or
its affiliates, supported by pertinent documents
3. Certified list of branches, sales outlets, place of
production, warehouses and storage facilities
4. Certified list of affiliates
5. Latest audited Financial Statement or Account
Information Form or its equivalent

Income tax exemption

What documents should be filed with
BIR by an income tax exempt BMBE?
In lieu of an Income Tax Return,
Annual Information Return
Filed on or before the 15th day of the
4th month after the close of the taxable
year
Contains data from its financial
statement and Sworn Statement of
Assets Owned and/or Used

Income tax exemption

Is the Income Tax Exemption Privilege of a BMBE irrevocable?
No. It may be revoked for any of the following reasons:
1. Transfer of place of business
2. Value of its total assets exceeds Php 3M
3. Voluntary surrender of the Certificate of Authority
4. Death of the registered individual owner of the BMBE; violation
or non-compliance with the provisions of R.A. 9178
5. Merger of consolidation with an entity which is not eligible to be
a BMBE
6. Sale or transfer of the BMBE, if it is a sole proprietorship without
prejudice to the transferee applying for registration
7. Submission of fake or falsified documents
8. Retirement from business, or cessation/suspension of operations
for one year
9. Making false or omitting required declarations of statements.

Exemption from coverage of the

Minimum Wage Law
How can a BMBE avail of the
exemption from the coverage of the
minimum wage law?
Once the BMBE is registered and
issued with a Certificate of Authority
by the Municipal or City Treasurer, it
is automatically exempted from the
minimum wage law.

Exemption from coverage of the

Minimum Wage Law
What is the effect of the law on the wages of
existing/newly hired employees?
1. Existing employees
Continue to receive their wages, allowances, and other
benefits

2. Newly hired employees

Exempted from the coverage of the minimum wage law
BMBE workers shall continue to be covered by applicable
labor laws and regulations, including the nondiminution rule on existing wages and benefits.

Exemption from coverage of the

Minimum Wage Law
Is the exemption from the coverage
of the minimum wage law
prospective in nature?
Yes.
Thus, in connection with the previous
question, an enterprises exemption
from the coverage of the minimum
wage law can only be applied to
employees hired after its registration
as a BMBE.

Exemption from coverage of the

Minimum Wage Law
How much should a BMBE worker be
paid for his service?
It depends between the employer and
the worker. They shall mutually agree
on the applicable wage rate.