Giving Up A Café Business
I hate this topic but I need to write about it so I could share my little knowhow on the subject. The primary reason why a café will close shop is because it is losing money and that no amount of new tactics and strategy could lift up its situation. There are other reasons like partners in the business decided to split their investments, expiration of contract on the leased premises and forced closure by authorities due to violation of some rules and regulations governing the operation of the business. No matter what the reason is, there are procedures that need to be followed when you decide to close your café business.
Whether you are going to sell your business lot, stock and barrel including its trade name or you will just simply close your shop and keep the equipment, you must inform your local government unit through its Business Permits and Licensing Office (BPLO) about your move within twenty (20) days after you cease operating your café. When you do so, BPLO must look at your records and see how your sales in the current year compare with the previous year. If your sales in the current year is comparatively lower than the immediate past year, you will not be asked to pay local tax for the current year and a clearance certificate must be issued to you.
The Bureau of Internal Revenue (BIR) is other other agency that you need to formally inform about the closure of your business. You will need to file BIR Form Form 1905 and comply with all the requirements in relation with the cancellation of business registration due to closure of business which include among others the surrender of your unused official receipts (OR) or invoice. A tax clearance is also in order after you complied with all the requirements.
You can just stop paying your Social Security System (SSS) and Pag-IBIG contributions but I suggest that if you still have ways to pay them, it is better to continue to pay. SSS and Pag-IBIG contributions are payments for pension plans that you are bound to enjoy in your old age. There are also emergency situations when they could provide loans to help you with your financial needs.
Selling your café equipment is an option that you may immediately decide on and unless you have a ready buyer, you may find this matter a little ticklish to accomplish. I shall deal on this issue in a more detailed manner in my future blogs.
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