How to Register a Church or Religious Organization in the Philippines: SEC and BIR Requirements

Introduction

In the Philippines, churches and religious organizations operate within a legal framework that recognizes their role in society while ensuring compliance with corporate and tax regulations. Registration formalizes their existence, provides legal personality, and enables them to own property, enter contracts, and seek tax exemptions. The primary regulatory bodies involved are the Securities and Exchange Commission (SEC) for incorporation and the Bureau of Internal Revenue (BIR) for taxation matters. This article provides a comprehensive guide to the registration process, drawing from Philippine laws such as the Revised Corporation Code (Republic Act No. 11232), the Tax Code (Republic Act No. 8424, as amended), and relevant administrative issuances. It covers all essential aspects, from pre-registration preparations to post-registration obligations, tailored to the Philippine context.

Legal Basis for Registration

The foundation for registering religious organizations lies in the Revised Corporation Code of the Philippines (RCC), which superseded the old Corporation Code (Batas Pambansa Blg. 68) in 2019. Specifically, Title XIII, Chapter II of the RCC governs "Religious Corporations," distinguishing them from ordinary non-stock corporations. Religious organizations are treated as non-stock, non-profit entities, exempt from certain requirements applicable to commercial corporations.

Key principles include:

• Freedom of Religion: Article III, Section 5 of the 1987 Philippine Constitution guarantees the free exercise of religion, which extends to the formation and operation of religious groups without undue state interference.
• Separation of Church and State: While the state does not endorse any religion, it facilitates registration to protect public interest and ensure accountability.
• Tax Exemptions: Under Section 30(E) of the National Internal Revenue Code (NIRC), religious organizations engaged exclusively in religious, charitable, or educational activities may qualify for income tax exemption, provided they meet BIR criteria.

Religious organizations must register to acquire juridical personality, allowing them to sue and be sued, acquire assets, and operate legally. Unregistered groups may function informally but lack these protections.

Types of Religious Organizations

Philippine law recognizes two main forms of religious corporations under the RCC:

1. Corporation Sole:

   • Suitable for hierarchical religious denominations where authority vests in a single natural person (e.g., a bishop, pastor, or head of a church).
   • Formed by the head of the religious denomination filing Articles of Incorporation.
   • Succession is automatic upon the death or incapacity of the incumbent, as per the organization's rules.
   • Common for Catholic dioceses or Protestant churches with centralized leadership.

2. Religious Society or Corporation Aggregate:

   • Appropriate for organizations governed by a board of trustees or multiple incorporators (at least five individuals).
   • Similar to a non-stock corporation but with religious purposes.
   • Ideal for evangelical churches, religious foundations, or interfaith groups with collective decision-making.

Both types must state in their Articles of Incorporation that they are formed for religious purposes and that no part of their income inures to the benefit of any member.

Pre-Registration Requirements

Before filing with the SEC, ensure compliance with foundational requirements:

• Eligibility: Incorporators must be natural persons of legal age (18 years or older), residents of the Philippines, and adherents to the faith. For corporation sole, the head must be a Filipino citizen or a foreigner authorized by the denomination's rules.
• Name Reservation: The proposed name must be unique, not misleading, and indicative of religious nature (e.g., "XYZ Church of the Philippines, Inc."). It should not resemble existing entities.
• Purposes: Clearly define religious objectives, such as worship, evangelism, charity, or education. Prohibited: Political activities or profit-making.
• Assets and Funding: Initial assets (e.g., real property or donations) must be declared. No minimum capital is required for non-stock corporations.
• Compliance with Other Laws: If involving land ownership, adhere to restrictions on foreign ownership under the Constitution. For indigenous groups, consult the Indigenous Peoples' Rights Act (Republic Act No. 8371).

Step-by-Step Registration Process with the SEC

Registration is primarily online via the SEC's Electronic Simplified Processing of Application for Registration of Corporation (eSPARC) system, or in-person at SEC offices. The process typically takes 1-4 weeks, depending on completeness.

Step 1: Name Verification and Reservation

• Access the SEC website (www.sec.gov.ph) and use the Company Name Verification System.
• Reserve the name for 30-90 days upon payment of a fee (approximately PHP 100-500).
• Ensure the name includes "Inc." or "Incorporated" for corporations.

Step 2: Preparation of Documents

Gather and notarize the following:

• Articles of Incorporation (AOI):

  • For Corporation Sole: Signed by the head, stating name, purposes, principal office, term (perpetual unless specified), and succession rules.
  • For Religious Society: Signed by at least five incorporators, including trustees' names and addresses.
  • Must affirm that the organization is religious and non-profit.

• By-Laws:

  • Outline governance, membership, meetings, and amendments.
  • For corporation sole, include provisions for auxiliaries or advisory boards.

• Affidavit of the Head or Incorporators:

  • Certifying adherence to the denomination's doctrines and no intent for profit.

• Endorsement from the Religious Denomination (if applicable):

  • For corporation sole, a certificate from the parent organization authorizing formation.

• Treasurer's Affidavit:

  • Declaring initial assets (e.g., cash, property) valued at least PHP 1,000.

• Proof of Payment:

  • Filing fees: Approximately PHP 2,000-5,000, plus 1% of authorized capital if any (waived for non-stock).

• Other Attachments:

  • IDs of incorporators, proof of address, and any deeds of donation.

Step 3: Submission and Review

• Upload documents via eSPARC or submit hard copies to the SEC main office in Mandaluyong or satellite offices.
• The SEC reviews for compliance with the RCC. Common issues: Incomplete forms or conflicting names.
• If approved, receive a Certificate of Incorporation, granting juridical personality.

Step 4: Post-Incorporation Compliance

• Publish the AOI and By-Laws in a newspaper of general circulation (cost: PHP 5,000-10,000).
• Secure a SEC Corporate Information Sheet.
• Register books of accounts and minutes.

Failure to comply may result in fines (PHP 1,000-10,000) or revocation.

Registration with the Bureau of Internal Revenue (BIR)

After SEC registration, obtain tax-related documents from the BIR to operate legally and claim exemptions.

Step 1: Obtain Taxpayer Identification Number (TIN)

• File BIR Form 1903 (Application for Registration) at the Revenue District Office (RDO) covering the principal office.
• Submit SEC Certificate, AOI, By-Laws, and IDs.
• Processing time: 1-3 days.

Step 2: Register Books of Accounts

• Secure authority to print receipts/invoices.
• Register manual or computerized books.

Step 3: Apply for Tax Exemption

• Religious organizations qualify under Section 30(E) of the NIRC if:
  • Organized and operated exclusively for religious purposes.
  • No net income benefits private individuals.
  • Assets upon dissolution go to similar exempt organizations.
• File BIR Form 1900 with supporting documents, including SEC papers, financial statements, and a certification of non-profit status.
• The BIR issues a Certificate of Tax Exemption (CTE) after review (1-6 months).
• Exemptions include: Income tax on donations, value-added tax (VAT) on certain transactions, and donor's tax for contributions.
• Note: Income from unrelated business activities (e.g., commercial rentals) is taxable.

Step 4: Annual Compliance

• File annual information returns (BIR Form 1702-EX) by April 15.
• Submit audited financial statements if gross receipts exceed PHP 3 million.
• Renew CTE every three years under Revenue Regulations No. 13-98.

Non-compliance may lead to penalties (PHP 1,000-50,000) or loss of exemption.

Additional Registrations and Considerations

• Local Government Units (LGUs): Secure a Mayor's Permit and Barangay Clearance for the place of worship. Fees vary by locality (PHP 500-5,000 annually).
• PhilHealth, SSS, and Pag-IBIG: Register as an employer if hiring staff.
• Data Privacy: Comply with the Data Privacy Act (Republic Act No. 10173) for member records.
• Foreign Involvement: If foreign-funded, register with the Philippine Council for NGO Certification (PCNC) for donee status.
• Property Ownership: Churches can own land, but foreigners are limited to 40% equity in corporations holding land.
• Amendments: Changes to AOI or By-Laws require SEC approval.

Benefits of Registration

• Legal protection against liabilities.
• Ability to receive tax-deductible donations.
• Eligibility for government grants or partnerships in social services.
• Enhanced credibility with members and donors.

Common Challenges and Pitfalls

• Delays in Processing: Due to incomplete documents; engage a lawyer or accountant for assistance.
• Tax Audits: BIR may scrutinize activities; maintain clear separation of religious and commercial operations.
• Internal Disputes: Governance issues can lead to SEC interventions or court cases.
• COVID-19 Impacts: As of 2025, online processes have streamlined registrations, but physical gatherings may still face health regulations.
• Costs: Total estimated: PHP 10,000-50,000, including fees and professional services.

Conclusion

Registering a church or religious organization in the Philippines is a structured process that balances religious freedom with regulatory oversight. By adhering to SEC and BIR requirements, organizations can focus on their spiritual missions while enjoying legal and fiscal benefits. It is advisable to consult legal professionals for tailored advice, as laws may evolve through new regulations or court rulings. Proper registration not only legitimizes operations but also fosters transparency and accountability in serving the community.