Bookkeeping, Invoicing and Registration Requirements - PowerPoint PPT Presentation

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Bookkeeping, Invoicing and Registration Requirements

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  1. Bookkeeping, Invoicing and Registration Requirements Presented by: Susan D. Tusoy, CPA, MPS Asst. Chief, Assessment Division BIR, Revenue Region 19, Davao City

  2. This presentation covers: • Registration Requirements; • Bookkeeping Requirements; and • Invoicing Requirements.

  3. REGISTRATION REQUIREMENTS

  4. On Registration • Register your business • On or before commencement of business • Before payment of any tax due • Upon filing of a return, statement or declaration as required by the NIRC. • Register your employee/s • within 10 days from date of employment

  5. On Registration • Secure Taxpayer Identification Number • Multiple TIN is punishable by law.

  6. Registration Procedures PRIMARY REGISTRATION SECONDARY REGISTRATION STAGE 1 STAGE 2 Application & Issuance of TIN Registration of Business/Practice of Profession/Employment Registration of books, Issuance of ATP, CAS and Loose-leaf

  7. Registration of Business • Pay Annual Registration Fee • Secure Certificate of Registration; • Proceed to Secondary Registration; • Get “Ask for Receipt” Notice • Attend Initial Briefing

  8. On Registration • Pay Annual Registration Fee of P500.00 upon registration and every year thereafter on or before Jan. 31 • for every separate or distinct establishment or place of business, including facility types where sales transactions occur

  9. Certificate of Registration (COR) • Issuance of COR to HO, Branch and Facility; • Posting of COR and Annual Registration Fee Return • In a way that is clearly and easily visible to the public

  10. Posting Requirement • Display “Ask For Receipt Poster” which shall be issued upon release of COR • Penalty: P1,000 and/or imprisonment of not more than 6 months.

  11. Registration of Tax Types • Income Tax; • VAT and/or Percentage Tax; • Withholding Tax on Compensation; • Creditable Withholding Tax at Source on certain income payments; • Final Withholding Tax on certain income payments; • Documentary Stamp Tax; • Excise Tax; and • Annual Registration Fee.

  12. Rules on Registration of Tax Types

  13. On Business Tax Type Registration • Mandatory VAT Registration Gross Sales/Receipts (actual/ expected) for the past 12 months, except those that are exempt under Sections 109 (1)(A) to (U) of the Tax Code, exceeded P1,919,500.00.

  14. On Business Tax Type Registration • Any person liable to VAT shall register with the RDO having jurisdiction over his/ its HO. • Failure to register as VAT shall make him/ it liable to pay the output tax, as if he/ it were a VAT-registered person, without benefit of input tax credits for the period in which he/ it was not properly registered.

  15. On Business Tax Type Registration • Non-VAT Registration 1. Those subject to percentage taxes; 2. Those whose transactions are VAT- exempt under Sect. 109 of Tax Code; and 3. Marginal income earners.

  16. Optional Registration of VAT 1. Those who are VAT-exempt since annual gross sales/receipts do not exceed P1,919,500.00; 2. Those who are engaged in mixed transactions; 3. Franchise grantees of radio and/or TV broadcasting • annual gross receipts do not exceed P10M. This option, once exercised, is irrevocable.

  17. Optional Registration of VAT • Registration for optional VAT is not later than 10 days before the beginning of the taxable quarter. • Once registered, the optional VAT taxpayer is liable to output tax and entitled to input tax beginning the first day of the month following his registration.

  18. Registration of All Storage Facilities (RR 2-2012) • All tank facilities, depots or terminals throughout the Phils., including those located within the Freeport Zones/Economic Zones shall be registered by the owners, lessors or operators with the BIR Office having jurisdiction over the said facilities.

  19. Transfer of Registration It shall be the duty of the transfering taxpayer to inform the BIR district office where he is registered of such fact by filing prescribed BIR Form specifying therein the complete address where he intends to transfer.

  20. Cancellation of Registration 1. Death of an individual not subject to estate tax; 2. Settlement of estate tax liabilities; 3. Discovery of a taxpayer having multiple TINs; 4. Dissolution, merger or consolidation of juridical persons.

  21. Penalty Provisions related to Primary Registration 1. Failure to register 2. Late registration 3. Late payment of ARF 4. Failure to register a branch or facility 5. Acquisition of multiple TINs 6. Failure to and/or erroneous supply of information

  22. REGISTRATION FORMS • 1901SELF-EMPLOYED/PROFESSIONALS/TRUST • 1902 Employees • 1903 CORPORATIONS / GOCC /PARTNERSHIP • 1903GOVERNMENT AGENCIES / LGUs • WHEN: ON OR BEFORE COMMENCEMENT OF BUSINESS/ BEFORE PAYMENT OF ANY TAX DUE/ UPON FILING A RETURN 10 DAYS AFTER BECOMING AN EMPLOYER ( SEC 2.83.6 Rev. Regulations No. 2-98) • WHERE: RDO

  23. BOOKKEEPING REQUIREMENTS

  24. ON BOOKKEEPING REQUIREMENTS • Apply for registration of books of accounts, basically a Journal, Ledger, and applicable subsidiary books • The BIR records your latest volume in our registration database. All of the above to be done within 30 days from date of registration

  25. ON BOOKKEEPING REQUIREMENTS • Transactions for the day must be entered in books on or before 12nn the following day. Balances transferred to the Ledger on day following the end of month • It’s not required to register new set of books every year; only before the pages of current book is almost used up (RMC 82-2008).

  26. Registration of Books • Persons required to pay internal revenue taxes shall keep and maintain the following books of accounts. • General Journal • General Ledger • Subsidiary Sales • Register Books to be Kept by Professionals (RR 7-87)

  27. Register Books to be Kept by Professionals (RR 7-87) • In addition to the books and other records, professionals shall keep and maintain Register Book which shall be entered immediately upon acceptance of client of patient

  28. Register Books to be Kept by Professionals (RR 7-87) • Required information: • Name and address of client or patient • Date and time of arrival • Amount of Professional Fee or other considerations received • Number and date of the receipt issued covering the said payment

  29. Books of Accounts • TP whose quarterly gross sales/receipts exceed P150,000 shall have their books audited and examined yearly by independent CPA. • Deadline for Registration • For new registrants -Before commencement of business

  30. Preservation of Books and Records(RR 17-2013) • Taxpayers are required to preserve their books of accounts, including subsidiary books and other accounting records • 10 years reckoned from the day the following the deadline in filing a return • If filed after the deadline • Reckoned from the date of filing of the return, for the taxable year when the last entry was made in the books of accounts

  31. Retention Period • If the taxpayer has any pending protest or claim for tax credit/refund of taxes • until the case is finally resolved. • The taxpayer and the CPA have equal responsibility to maintain and preserve the records • for a period of ten years

  32. Retention Period • Other accounting records includes • Invoices, receipts • Vouchers • Returns and • Other source documents supporting the entries

  33. Examination and Inspection • Records shall be kept at all times at the place of business of the TP • Upon the demand, the same must be immediately produced and submitted for inspection • Regular audit • Extra-ordinary audit • for exchange of information by a foreign tax authority • Examinations shall be done in the taxpayer’s office or place of business or in the Office of the BIR

  34. INVOICING REQUIREMENTS

  35. INVOICING REQUIREMENTS All persons subject to internal revenue tax shall: • For each sale of P25 or more; • Issue duly registered receipts or sales or commercial invoices; • Prepared at least in duplicate.

  36. Invoicing Requirements(Sec. 237) Required information: • Date of transaction • Quantity • Unit Cost • Description of merchandise or nature of the service • TIN of purchaser if VAT-registered

  37. Invoicing Requirements (Sec. 237) Required information: Name, business style and address of the purchaser shall be indicated in the ff. cases – • Seller and buyer are VAT-subject persons; • Receipt covers rentals, commission, compensation or fees.

  38. Invoicing Requirements (Sec. 237) Disposition of the receipts/invoices • Original -> purchaser • Duplicate -> retained by issuer

  39. Proper Invoicing and Receipting of Output Tax RR 18-2011 • Reiterates Sec. 237 of the Tax Code that VAT-registered taxpayers should separately bill the VAT. • The amount shall be shown as a separate item in the invoice or receipt

  40. Principal Receipt/Invoice(RR 18-2012) A written account evidencing the sale of goods and/or services issued to customers in an ordinary course of business

  41. Sale of Goods and Properties(Includes Cash Sales Invoice and Charge Sales Invoice) • VAT Sales Invoice • Basis of the output tax liability of the seller and the input tax claim of the buyer • Includes Cash Sales Invoices & Charge Sales Invoices • Non-VatSales Invoices • Basis of the Percentage Tax liability of the seller

  42. Sale of Service and Leasing of Properties • VAT Official Receipt • Basis of the output tax liability of the seller and the input tax claim of the buyer • Non-VatOfficial Receipts • Basis of the Percentage Tax liability of the seller

  43. Supplementary Receipts/Invoices • Also known as Commercial Invoices • Documents evidencing delivery, agreement to sell or transfer of goods and services • Delivery Receipts • Order Slips • Debit and/or Credit Memo • Purchase Order

  44. Supplementary Receipts/Invoices Job Order Provisional/Temporary Receipt Acknowledgement Receipt Collection Receipt Cash Receipt Bill of Lading Billing Statement Statement of Account

  45. Supplementary Receipts/Invoices Includes any other documents, by whatever name it is known or called whether prepared manually or pre-printed/pre-numbered loose-leaf or computerized, issued to customers Not valid to support the claim of Input Taxes by buyers of goods and/or services

  46. Salient Features One application shall be filed for ATP per establishment (HO or branch) Filed with RDO/LT Office where the HO is registered Each application shall be issued a separate ATP Independent series of serial number for all receipts/invoices (principal & supplementary)

  47. Salient Features • The approved ATP shall be • valid only upon full usage or • five (5) years from issuance of the same, whichever comes first. • The replicate copy of the ATP issued shall be printed at the inside back portion of the cardboard cover

  48. Salient Features • ONLY BIR ACCREDITED PRINTERS shall have the exclusive authority to print principal and supplementary receipts/invoices. • Reiterated under RMC 61-2013 • Issuing receipts/invoices printed by non-accredited printers is tantamount to issuing invalid receipts/invoices

  49. Transitory Provision Expiring ATP for invoices/receipts (principal and supplementary) shall apply for a new ATP not later than 60 days prior to actual expiry date

  50. Validity of Unused/Unissued Commercial Invoices