The Bureau of Internal Revenue (BIR) issued Revenue Memorandum Circular (RMC) No. 77-2024, clarifying the taxpayer’s issues regarding invoicing requirements under the Ease of Paying Taxes (EOPT) Act and Revenue Regulations (RR) No. 7-2024, as amended by RR No. 11-2024.
Threshold in issuance of invoice
VAT-registered sellers are required to issue a VAT invoice for each sale transaction, regardless of the amount. On the other hand, non-VAT registered sellers are required to issue a non-VAT invoice when the amount of a single transaction is more than Php 500.00, or upon the request of the buyer for an invoice, regardless of the amount of the transaction, or when the aggregate amount of all sales transactions amounting to less than Php 500.00 exceeds the Php 500.00 threshold.
The Php 500.00 amount shall be adjusted to its present value every three (3) years, beginning January 22, 2024, or the effectivity of the EOPT Act, using the Consumer Price Index, as published by the Philippine Statistics Authority.
Conversion of official receipts to invoice
Sellers shifting from official receipt to invoice must apply for a new Authority To Print (ATP) invoice, with a separate set of serial numbers if using different types of invoices. Further, sellers have the option to continue using the official receipts as supplementary documents or to convert and use the remaining official receipts as invoice, until fully consumed.
Official receipts used as supplementary documents must be stamped with the phrase “This document is not valid for claim of input tax.” on each page. Failure to do so will not make the document a valid replacement for the invoice and may be subject to an applicable penalty. The last approved serial number of the official receipt must be continued when applying for a subsequent ATP for the official receipt as a supplementary document.
On the other hand, official receipts or billing statements or statements of account or statements of charges converted to invoice must be stamped “Invoice” or any name describing the transaction for which such invoice is issued, and the word “Official Receipt” or “Billing statement” or any similar name must be stricken out on the face of the manual and loose leaf printed documents, without any need for approval from the Revenue District Office (RDO) where the seller belongs. The conversion of such documents to invoice is allowed, provided that the converted invoice shall contain the required information under RR No. 7- 2024, as amended by RR No. 11-2024, such as quantity, unit cost, and description or nature of service. Any required missing information may be stamped on the document, if not originally included, upon conversion.
For manual and loose-leaf, the converted official receipts to invoice must be reported to the BIR through the submission of an inventory report (Annex C), indicating the number of booklets and serial numbers of the unused official receipts, no later than July 31, 2024. For point-of-sales machine or cash register machines or computerized accounting system with e-receipting, the renamed official receipt to invoice must be reported through the submission of a notice on the renaming of machine/system generated official receipt to invoice (Annex D), indicating the starting serial number of the converted invoice and the start date when such serial number is issued, no later than 30 days from completion of machine/system reconfiguration/enhancement or on December 31, 2024, whichever comes first. Any letter request for extension to enhance the system must be coursed through the concerned RDO, subject to final approval by the Regional Director or Assistant Commissioner, before December 31, 2024, stating the reason for the request for extension, target date of completion of enhancement, and email address and other contact details of the contact person.
Annexes C and D will be submitted to the RDO, where the head office or branch office is registered, or through the Taxpayer Registration Related Application (TTRA) or TTRA Portal. Sellers who have previously complied with the inventory report or letter notice are no longer required to resubmit.
Consequences on failure to comply with invoicing requirements
Failure to supply an invoice, as the primary document for the sale of goods or services, is subject to a penalty of not less than P1,000 but not more than P50,000 and imprisonment of not less than 2 years but not more than 4 years.
Sellers who are not VAT-registered and issued a VAT invoice are liable to 12% VAT without the benefit of any input tax credit and 50% surcharge, in addition to the percentage tax liability. On the other hand, VAT-registered sellers who issued VAT invoice without mandatory information, are liable for non-compliance with the invoicing requirements. However, the VAT amount is allowed to be claimed as input VAT on the part of the VAT-registered buyer, provided that the amount of sales, VAT amount, registered name and TIN of the buyer and seller, description of goods or services, and date of transaction are properly indicated on the face of the invoice.
Effectivity
The invoicing requirements and transitory provisions under RR No. 7-2024, as amended by RR No. 11-2024, implementing the EOPT Act is effective April 27, 2024, 15 days after the date of publication on the BIR official website on April 12, 2024. Further, all clarificatory provisions in RMC No. 77-2024 will take effect immediately upon posting on the BIR website on July 11, 2024.
Please be guided accordingly.
Source:
P&A Grant Thornton
Certified Public Accountants
P&A Grant Thornton is the Philippine member firm of Grant Thornton International Ltd.
As published in SunStar Cebu, dated 24 July 2024
