Despite contention over whether Puerto Rico is still officially a part of the United States and economic and deficit problems as of 2010, Puerto Rico can still work as a viable place to start a business. Tourism is usually the biggest industry there, though pharmaceuticals, electronics and clothing stores do equally well. The better news is that Puerto Rico has start-up procedures with less costs than you'd find in places outside the U.S. mainland.
Things You'll Need
- Trademark and trade name registration
- Business certificate
- Employee Identification Number filing
- 4809 and 499-R-4 tax forms
- Municipal business license
- Merchant's Registration Certificate and Exemption Certificate
- Disability and unemployment accounts numbers
- Workman's compensation insurance
Check to make sure your business name is unique. Look in a local phone book for businesses similar to yours and see what the titles are. Keep in mind that the phone book in your Puerto Rican city will be in Spanish and you'll have to create a business name in Spanish.
Register a trademark and your trade name with the Dept. of State's Registry of Marks and Commercial Names. The site goes down on occasion, but you can visit the Dept. of State in person to register. Registration is $100.
Obtain your business certificate while at the Dept. of State. You'll be filing this in the Corporations Division in the same building. Fill out all information about your business on the certificate, including the purpose of your business, its address and information on shares and stockholders. You can start operating the business the same day this gets filed and the fee for issuance is $10.
File for an Employee Identification Number with the IRS as you would with any other business in the United States. This is used for taxes, Medicare and Social Security over a regular Social Security number.
Turn in your EIN to the Puerto Rico Treasury Department. You'll have to fill out one of their 4809 forms in order to do this. The form will require you to provide a lot of personal information about yourself and your finances. Afterward, all the employees you hired need to fill out the 499-R-4 form for tax information and turn it into the Treasury Department.
Visit your local municipality in your Puerto Rican city and apply for a municipal business license. You can wait up to 30 days after opening your business to file this, but you'll get a heavy penalty if you don't file at all. It's for municipal license tax purposes and calculated on .5% of your gross sales as of 2010. There's no charge to file.
Procedures After Opening the Business
Turn in the SC 2914 form at the Dept. of Treasury for an Application for Merchant's Registration Certificate and Exemption Certificate. This is required to give official record to the Secretary of the Treasury that your business exists and can be monitored. It needs to be filed by July 15 each year. If you started your business between January and the July due date, you don't have to turn it in until July 15 of the next year.
Go to your local Department of Labor and request account numbers for disability and unemployment. There's no charge to obtain these and you'll need them if you're hiring employees in your business.
Obtain workman's compensation insurance for your employees through your local State Insurance Fund Corporation. As with all insurance premiums, it'll vary year by year and depending on changes to health insurance structure.
Tips & Warnings
- Study the economic climate for a business in Puerto Rico by checking out their Dept. of Economic Development and Commerce (see Resource 5). There, you can determine which cities might offer the least economic challenges.
- Photo Credit Beach umbrellas in Puerto Mogan image by Mike Price from Fotolia.com
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