Can I just stop filing if I close my business?

No. You must file an application for closure with the BIR. Until you do, the BIR may still expect returns and can assess penalties for non-filing.

What form is used to close a business?

BIR Form 1905 is used to update or cancel registration, including business closure, filed at the RDO where the business is registered.

What is a tax clearance in closure?

It is the BIR's confirmation, issued once your open cases and liabilities are settled, that your registration can be closed.

How to Close or Retire a Business with the BIR

Registration1 min readUpdated May 25, 2026

When a business stops operating, you cannot simply stop filing. You must tell the BIR so it can close your registration and confirm you have no unsettled taxes. Here is how it works.

Why you must formally close

Filing an application for closure informs the BIR that your business has ceased operations. The BIR then checks whether you have any open cases or tax liabilities that must be settled before it issues a tax clearance.

Until you close properly, the BIR may still expect returns from you and can assess penalties for non-filing.

The general process

Closure usually involves:

Filing the application for closure using BIR Form 1905.
Filing at the RDO where the business or branch is registered.
Settling any remaining tax liabilities and open cases.
Receiving a tax clearance once everything is in order.

Before you start

Closure can take time if there are open cases, so it helps to be current on your filings first.

Ask AskOnward for the exact documents and steps for closing your specific type of registration.

Have a specific question?

Ask AskOnward and get an answer grounded in the official BIR rules, with the current forms, fees, and steps for your situation.

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Frequently asked questions

Can I just stop filing if I close my business?: No. You must file an application for closure with the BIR. Until you do, the BIR may still expect returns and can assess penalties for non-filing.
What form is used to close a business?: BIR Form 1905 is used to update or cancel registration, including business closure, filed at the RDO where the business is registered.
What is a tax clearance in closure?: It is the BIR's confirmation, issued once your open cases and liabilities are settled, that your registration can be closed.

Related guides

This guide is for general information and is not affiliated with the government. For official forms and the latest rules, see the Bureau of Internal Revenue at bir.gov.ph.