AWARENESS ON BUSINESS

REGISTRATION,
INVOICING AND
BOOKKEEPING;
A STEP TOWARDS
EFFICIENT BUSINESS
OPERATIONS &
MANAGEMENT
Types of Internal Revenue Taxes
1. Income Tax
2. Business Tax
a. Value-Added Tax
b. Percentage Tax
3. Documentary Stamp Tax
4. Estate Tax
5. Donor’s Tax
6. Excise Tax
 Business
Registration
Partnership/Corporation •Sole Proprietorship
• SEC • DTI
(Regulatory Agency) •(Regulatory Agency)
• Municipal • Municipal
(Local Government) •(Local Government)
• BIR • BIR
(National •(National
Government Government)
)
 Requirements for Registration
1.Birth Certificate, or any identification card
showing the applicant’s complete name, address,
date of birth & signature (Individuals);
2.Articles of Partnership/ Incorporation
(Partnerships/Corporations);
3. Application for Registration BIR Form 1901 for
Individuals, BIR Form 1903 for
Partnerships/Corporations;
4. Mayor’s Permit;
5. DTI or SEC Certificate;
6. Lease Contract, if applicable.
 Procedures
• a) Accomplish BIR Form 1901/1903 and
1906
and submit the same with
together documentary the the
requirements
Business with Counter of the RDO
Registrant Newhaving
jurisdiction over the place where the head office
and branch, respectively.
• b) Pay the Annual Registration Fee (P500.00) at
the New Business Registrant Counter in the BIR
Office.
• c) Pay Documentary Stamp Tax (DST) (loose
DST / BIR Form 2000* for DST on Contract of
Lease, etc). Present proofs of payment.
 Procedures
• d) The RDO then issue the Certificate
shall (Form 2303) oftogether with the “Ask
Registration
for
Receipt” Notice (ARN), Authority to Print.
• e) Attend the taxpayer’s initial briefing to be conducted
by the RDO concerned for new registrants in order to
apprise them of their rights and duties/responsibilities.
• f) Apply for Registration of books of accounts: Journals
and Ledgers and applicable subsidiary books and have
them stamped by the RDO where the taxpayer is
registered ; and
• g) Update registration information, if needed, using BIR
Form No. 1905 (change of registered address, personal
exemptions, additional tax types, etc.) submit this at the
RDO having jurisdiction over the place of business.
 Deadlin
• All Individuals e in or shall
engagedand file the application
accomplish trade business
on or before the
commencement of business, it shall be reckoned from
the day when the first sale transaction occurred or within
thirty (30) calendar days from the issuance of Mayor's
Permit/Professional Tax Receipt (PTR) by LGU, which
ever comes earlier.
• Corporations and their branches shall accomplish and
file the application on or before the commencement of
business, it shall be reckoned from the day when the first
sale transaction occurred or within thirty (30) calendar
days from the issuance of Mayor's Permit/PTR by LGU,
or Certificate of Registration issued by the Securities and
Exchange Commission (SEC), whichever comes earlier
What happens if taxpayer registered his/her
business beyond the prescribed period?

S SURCHARGE
25% of basic tax due
INTEREST
I 12% per annum of basic
tax due
COMPROMISE
C PENALTY
graduated (RMO 7-
Register Tax Types (determined by
BIR)
1. Registration Fee
2. Income Tax
3. Business Tax (VAT or Percentage Tax)
4. Withholding Tax (Compensation,
Expanded, Final)
5. Other applicable taxes as may
be determined by BIR
Note: The Original Annual
COR, and the ARN must
Registration Fee (latest)
be conspicuously in
taxpayer’s
displayed place of the
business.
 INVOICIN
G
Section 237 of the Tax Code of the Philippines
mandates every taxpayer engaged in trade or
business to issue an official receipt and/or a sales
invoice for each sale and transfer of goods and
services to the purchaser, at the time the transaction
is effected.

A duly-registered receipt or sales or commercial

invoice , prepared at least in duplicate, shall be
issued for each sale of merchandise or service
rendered valued at ₱100 or more.
 What’s the difference
between sales
invoices and official receipts?
Invoices or sales invoices are used for the
sale of goods.

Official receipts are used for the sale of

services

Revenue Regulation No. 18-2012 classifies

invoices and receipts into principal and
supplementary.
Principal receipts/invoices
1. VAT sales invoice
Used for either cash or credit, this invoice shows:
How much output VAT a seller owes for that
particular transaction
Input tax claim of the buyer

2. VAT official receipt

Used as reference for seller’s output VAT and the
input VAT claim of the buyer. It shows:
How much output VAT a seller owes for that
particular transaction
Input VAT claim of the buyer
3. Non-VAT sales invoice

It shows how much percentage tax a seller owes

for that particular transaction.

4. Non-VAT official receipt

Issued by the seller to the buyer proving the sale

of a service or the leasing of property. It shows
how much percentage tax the seller owes for that
particular transaction.
Supplementary receipts/invoices

Also known as commercial invoices,

supplementary receipts show the
transaction that occurs between the seller
and buyer of goods and/or services. It is
used for recording, monitoring, and control
purposes in the book of accounts of a
business taxpayer. Also proves that an
agreement to deliver, sell, or transfer goods
and services has been made.
 A supplementary receipt or invoice come in many
types, including:
•Delivery receipts, Order slips, Debit and/or credit memo,
Purchase order, Job order, Provisional/ temporary receipt,
Acknowledgement receipt, Collection receipt, Bill of lading,
Billing statement, Statement of account, etc.

NOTE:
Supplementary receipts/invoices cannot
be used for VAT purposes as proof
of input VAT owed by customers.
WHAT ARE THE INVOICING REQUIREMENTS?

Issue sequentially an Official Receipt (for

fees received) or Sales Invoice (for sale of goods)
which indicate the name of the taxpayer, TIN and
registered address.
Each Official Receipt (OR) issued shall
indicate the name and address of the client, date
of transaction, nature of service rendered, and the
amount.
WHAT ARE THE INVOICING REQUIREMENTS?

Each Sales Invoice (SI) shall show the name

and address of the client, date of transaction,
quantity, selling price per unit, description of
merchandise sold and total amount.

The OR/SI shall be accomplished at least in

duplicate – the original shall be issued to the client
at the time of payment and the duplicate must be
retained and preserved in the place of business
for a period of ten (10) years from the close of
the taxable year.
 BOOKKEEPING
All corporations, companies, partnerships or
persons required by law to pay internal revenue
taxes shall keep and use relevant and
appropriate set of bookkeeping records duly
authorized by the Secretary of Finance.

Those whose gross annual sales, earnings,

receipts or output exceed ₱3,000,000 shall have
their books of accounts audited and examined
yearly by independent CPAs and their Income Tax
Returns.
Manner of Bookkeeping
1. Manual Books of Accounts

These are the traditional pre-printed types of

books that are readily available in office supplies,
stores, and bookstores. Referred to as journals,
columnar books journals, or ledgers, entries are
usually handwritten or manually updated.
Because it is the most cost-effective and easiest
means of booking accounts, it is also the most
popular. It is also fairly easy to register manual
books with the BIR.
2. Loose-leaf Books of Accounts

Loose-leaf books are printed and bound ledgers

and journals, similar to manual books of accounts.
The main difference is that instead of handwritten
ledgers, records or entries were not manually
written, but typed into a computer and printed
out, usually using simple systems like Microsoft
Excel.

When you register loose-leaf books of accounts with BIR,

you will need to justify why you utilized this particular
method instead of manual or computerized booking.
Sample print outs will be required to be book-bound
submitted to BIR for stamping. (With Permit To Use)
3. Computerized Books of Accounts

This method employs the use of computer

programs that have been configured in an
accounting system to facilitate easy, accurate, and
speedy record keeping. The system should be
registered by the BIR because of the need to
verify how accurate and capable your computer
system is in keeping your books of account.
Systems such as Peachtree, QuickBooks, XERO,
SAP, or MYOB are readily available in the market.
(With Permit To Use)
General Journal – otherwise called the book of
original entry, it is a recording of business
transactions entered into the books based on the
date of transaction, using the principle of “debit
and credit”.

General Ledger – also known as the book of final

entry, it is a summary of all journal entries in
order to get ending balances.

Cash Receipt Journal – a recording of cash sales

as well as the collection of receivables.
Cash Disbursement Journal – a recording of cash
payments and payables, if any.

Sales Journal – a recording of receivables

from customers, or any sales made on credit.

Purchase Journal – a recording of purchases

on credit or payables due to suppliers.
AND
 ANNUAL REGISTRATION
FEE
Pay the registration fee (RF) of P500.00
upon registration, and every year
thereafter on or before January 31,
using BIR Form No. 0605 (Payment
Form) to any Authorized Agent Bank
(AAB) or the Revenue Collection Officer
(RCO) located within the RDO having
jurisdiction on the taxpayer.
 INCOME
TAX
is a tax on a person's income, emoluments,
profits arising from property, practice of
profession, conduct of trade or business or
on the pertinent items of gross income
specified in the Tax Code of 1997 (Tax
Code), as amended, less the deductions if
any, authorized for such types of income, by
the Tax Code, as amended, or other special
laws.
 Annual Income Tax For Individuals (1701)
Documentary Requirements
• Certificate of Income Tax Withheld
on Compensation (BIR Form 2316), if applicable
• Certificate of Income Payments Not Subjected
to Withholding Tax (BIR Form 2304), if applicable
• Certificate of Creditable Tax Withheld at
Source (BIR Form 2307), if applicable
• Duly approved Tax Debit Memo, if applicable
• Proof of Foreign Tax Credits, if applicable
• Income Tax Return previously filed and proof of
payment, if filing an amended return for the same
year
• Account Information Form (AIF) or the Certificate of
the independent Certified Public Accountant (CPA)
with Audited Financial Statements if the gross
annual sales, earnings, receipts or output exceed
three million pesos (P3,000,000.00)
• Account Information Form or Financial Statements
not necessarily audited by an independent CPA if
the gross annual sales, earnings, receipts or output
do not exceed P3,000,000.00 and is subject to
graduated income tax rates under Section 24(A)(2)
(a)
• Proof of prior year’s excess tax credits, if
applicable
PROCEDURES
• For Non-eFPS Filer
– Fill-up fields in the BIR Form No. 1701 in the
downloaded Electronic Bureau of Internal
Revenue Form (eBIRForm) Package
– Print the duly accomplished BIR Form No.
1701
– Proceed to the nearest Authorized Agent Bank
(AAB) under the jurisdiction of the Revenue
District Office where you are registered and
present the duly accomplished BIR Form 1701,
together with the required attachments and your
payment.
PROCEDURES
– In places where there are no AABs, proceed to
the Revenue Collection Officer or duly
Authorized City or Municipal Treasurer located
within the Revenue District Office where you
are registered and present the duly
accomplished BIR Form 1701, together with the
required attachments and your payment.
– Receive your copy of the duly stamped and
validated form from the teller of the AABs
/Revenue Collection Officer/duly Authorized
City or Municipal Treasurer.
 PROCEDURES
• For Manual Filer
– Fill-up the BIRFormNo.1701 in
copies. triplicate
– Proceed to the Revenue District Office where
you are registered or to any Tax Filing Center
established by the BIR and present the duly
accomplished BIR Form 1701, together with the
required attachments.
– Receive your copy of the duly stamped and
validated form from the RDO/Tax Filing Center
representative.
Deadlin
e
• Final Adjustment Return or Annual Income
Tax Return - On or before the 15th day of
April of each year covering income for the
preceding taxable year.

Quarterly ITRs (1701Q)

 1st – May 15 of the current taxable year
 2nd – August 15 of the current taxable year
3 r– November 15 of the current taxable
year
d
For
Self-Employed Individual
Purely
and/or Professionals Whose s Gross
Sales/Receipts and Other Non-Operating
Income Do Not Exceed the VAT Threshold
of P3,000,000, the tax shall be, at the
taxpayer’s option:
• 8% Income Tax on Gross Sales or Gross
Receipts in Excess of P250,000 in Lieu of the
Graduated Income Tax Rates and the
Percentage Tax; Or
• Income Tax Based on the Graduated Income
Tax Rates
For Income from Business and/or Practice of
Profession:
– If the total Gross Sales/Receipts Do Not
Exceed VAT Threshold of P3,000,000, the
Individual Taxpayer May Opt to Avail:
» 8% Income Tax on Gross Sales/Receipts
and Other Non-Operating Income in Lieu of
the Graduated Income Tax Rates and the
Percentage Tax; Or
» Income Tax Based on Graduated Income
Tax Rates
– If the total Gross Sales/Receipts Exceed
VAT Threshold of P3,000,000
» Income Tax Based on Graduated Income
Tax Rates
 Annual Income Tax For Corporations/ Partnerships
(1702)
Documentary
Requirements
• Certificate of Income Payments Not Subjected
to Withholding Tax (BIR Form 2304), if applicable
• Certificate of Creditable Tax Withheld at
Source (BIR Form 2307), if applicable
• Duly approved Tax Debit Memo, if applicable
• Proof of Foreign Tax Credits, if applicable
• Income tax return previously filed and proof of
payment, if amended return is filed for the same
taxable year
• Account Information Form (AIF) or the Certificate
of the independent CPA with Audited Financial
Statements, if the gross annual sales, earnings,
receipts or output exceed P3,000,000.
• Proof of prior year’s excess tax credits, if
applicable
 PROCEDURES
• For Non-eFPS Filer
– Fill-up fields in the BIR Form No. 1702 in the
downloaded Electronic Bureau of Internal
Revenue Form (eBIRForm) Package
– Print the duly accomplished BIR Form No.
1702
– Proceed to the nearest Authorized Agent Bank (
AAB) under the jurisdiction of the Revenue
District Office where you are registered and
present the duly accomplished BIR Form 1702,
together with the required attachments and your
payment.
 PROCEDURES
– In places where there are no AABs, proceed to
the Revenue Collection Officer or duly
Authorized City or Municipal Treasurer located
within the Revenue District Office where you are
registered and present the duly accomplished
BIR Form 1702, together with the required
attachments and your payment.
– Receive your copy of the duly stamped and
validated form from the teller of the AABs
/Revenue Collection Officer/duly Authorized City
or Municipal Treasurer.
 PROCEDURES
• For Manual Filer
– Fill-up the BIR Form No. in
1702 copies. triplicate
– Proceed to the Revenue District Office where
you are registered or to any Tax Filing Center
established by the BIR and present the duly
accomplished BIR Form 1702, together with the
required attachments.
– Receive your copy of the duly stamped and
validated form from the RDO/Tax Filing Center
representative.
Deadlin
e
• Final Adjustment Return or Annual
Income Tax Return - On or before the
15th day of the fourth month following the
close of the taxpayer’s taxable year

Corporate Quarterly Declaration or

Quarterly Income Tax Return (1702Q)
-on or before the 60th day following the
close of each of the quarters of the
taxable year
 PERCENTAGE TAX
Percentage tax is a business tax
imposed on entities,
transactions
persons, specified under
or Sections
116 to 127 of the Internal
National Code of 1997 (also known as
Revenue
Tax Code), as amended, and as
required under special laws.
Quarterly Percentage Tax Return
(2551Q) Documentary Requirements
• BIR Form 2551Q - Quarterly Percentage
Tax Return Form
• Duly issued Certificate of Creditable Tax
Withheld at Source (BIR Form 2307), if
applicable
• Duly approved Tax Debit Memo, if
applicable
• For amended return, proof of payment and
the return previously filed
• Authorization letter, if filed by an authorized
representative
• Copy of Certificate of Registration issued
by
Cooperative Development Authority for
cooperatives and from the National
, Administratio for
Electrificatio n electric
n
cooperatives
 PROCEDURES
• For Manual filing and/or payment:
– Download the newly-revised BIR Form 2551Q pdf
file format under the BIR Forms-VAT/Percentage
Tax Returns section of the BIR website.
– Properly fill-up BIR Form 2551Q in triplicate copies.
– Proceed to any Authorized Agent Bank (AAB
)located within the territorial jurisdiction of
the District Office (RDO) wherethe
Revenue
taxpayer registere and presentthe
accomplishe
is d BIRForm2551Q duly and
d other
requirements.
 PROCEDUR
ES
If paying manually, present the aforementioned documents
together with BIR-prescribed deposit slip, and payment to the
respective AAB. The Quarterly Percentage Tax shall be paid
at the time the return is filed by the taxpayer.
– In places where there are no AABs, the duly
accomplished BIR Form 2551Q, together with the
required attachments and payment, shall be filed/paid
with the Revenue Collection Officer (RCO), thru the
Mobile Revenue Collection Officers System (MRCOS)
facility, or duly Authorized Treasurer of the city or
municipality where said business or principal place of
business / where the taxpayer is registered, who will
issue an Electronic Revenue Official Receipt (eROR).
 PROCEDUR
– Receive
ES
copy of BIRForm2551Q duly
validated/stamp- by the
received City or
AAB/RCO/authorized Municipal
– Treasurer.
Manual Filers who want to pay online can
pay through GCash Mobile Payment,
theLandBank of (LBP) Linkbiz Portal (for
Philippines have ATM account
taxpayers
LBP/BancnetwhoATM or Debit Card), or DBP with
Tax
Online (for holders of Credit
VISA/Master ATM or Debit Card).
Card/Bancnet
 PROCEDURES
• For eBIRForms filing and/or payment:
– Use the existing enhanced old BIR Form 2551Q in
Offline eBIRForms Package V7, which contained all the
alphanumeric tax codes (ATCs) enumerated in BIR
Form 2551M in filing the return.
– Taxable amount to be indicated in the quarterly
percentage return shall be the total gross sales/receipts
for the quarter.
– In case percentage taxes for the first, second and/or
third month of the quarter had been paid, payment/s
made are to be reflected in BIR Form 2551Q in Item No.
20A-Creditable Percentage Tax Withheld per BIR Form
2307.
 PROCEDURES
– Proceed to any AAB located within the territorial jurisdiction of
the RDO where the taxpayer is registered and present the duly
accomplished BIR Form 2551Q and other requirements. If there
is payment that will be done manually, present the
aforementioned documents together with BIR-prescribed
deposit slip, and payment to the respective AAB. The
Percentage Tax shall be paid at the time the return is filed by
the taxpayer.
– In places where there are no AABs, the duly accomplished BIR
Form 2551Q, together with the required attachments and
payment, shall be filed/paid with the RCO, thru the MRCOS
facility, or duly Authorized Treasurer of the city or municipality
where said business or principal place of business / where the
taxpayer is registered, who will issue an Electronic Revenue
Official Receipt (eROR).
 PROCEDURES
– eBIRForms Filers who want to pay online can pay through
GCash Mobile LandBank of the Philippines
(LBP) Linkbiz Portal
Payment, taxpayers who have
account with LBP/Bancnet ATM
(for ATMor Debit Card), or DBP
Tax Online (for holders of VISA/Master Credit
Card/Bancnet ATM or Debit Card).
• Note: "No payment" returns filed late will result
on imposition by the RDO of penalties, which
shall be paid at the concerned AAB.

DEADLINE:
Within twenty-five (25) days after the end of
each taxable quarter
 VALUE-ADDED TAX
- is a form of sales tax. It is a tax on consumption
levied on the sale, barter, exchange or lease of
goods or properties and services in the Philippines
and on importation of goods into the Philippines. It is
an indirect tax, which may be shifted or passed on to
the buyer, transferee or lessee of goods, properties
or services.
Any person or entity who, in the course of his trade or
business, sells, barters, exchanges, leases goods or
properties and renders services subject to VAT, if the
aggregate amount of actual gross sales or receipts
exceed Three Million Pesos (Php3,000,000.00)
 Monthly VAT
Declarations BIR
Form 2550M
Documentary Requirements
• Duly issued Certificate of Creditable VAT
Withheld at Source (BIR Form No. 2307), if
applicable
• Summary Alphalist of Withholding Agents of
Income Payments Subjected to Withholding Tax at
Source (SAWT), if applicable
• Duly approved Tax Debit Memo, if applicable
• Duly approved Tax Credit Certificate, if applicable
• Authorization letter, if return is filed by
authorized representative.
Procedures
• Fill-up BIR Form No. 2550M in triplicate
copies (two copies for the BIR and one
copy for the taxpayer).
• If there is payment:
– File the Monthly VAT declaration, together with
the required attachments, and pay the VAT due
thereon with any Authorized Agent Bank
(AAB) under the jurisdiction of the Revenue
District Office (RDO)/Large TaxpayersDistrict
Office (LTDO) where the taxpayer (head office
of the business establishment) is registered.
Procedures
– Accomplish and submit BIR-prescribed
deposit slip, which the bank teller shall machine
validate as evidence that payment was
received by the
AAB. The AAB receiving the tax return shall
stamp mark the word "Received" on the return
and machine validate the return as proof of filing
the return and payment of the tax.
– In places where there are no AAB, file the
Monthly VAT declaration, together with the
required attachments and pay the VAT due with
the Revenue Collection Officer (RCO)
Procedures
– The RCO shall issue a Revenue Official Receipt
upon payment of the tax.
• If there is no payment:
– File the Monthly VAT Declaration, together with
the required attachments, with the
RDO/LTDO/Large Taxpayers Assistance
Division, Collection Agent having jurisdiction
over the registered address of the taxpayer
(head office of the business establishment).
Deadline
• Manual Filing - Not later than the 20th
day following the end of each month
 Quarterly Value-Added Tax
Return BIR Form 2550Q
Documentary Requirements
• Duly issued Certificate of Creditable VAT
Withheld
at Source (BIR Form 2307), if applicable
Summary
• Payments Alphalist
Subjected of to
Withholding Tax ofSource
Agents
Withholding
Income at (SAWT), if applicable
• Duly approved Tax Debit Memo, if applicable
• Duly approved Tax Credit Certificate, if
applicable
amended return
• Previously filed return and proof of
• payment,
Authorization for if return is filed by
letter, authorized
representative
Procedures
• Fill-up BIRForm2550Q in triplicate copies
(two copies for the BIR and one copy for the
taxpayer)
• If there is payment:
– File the Monthly VAT declaration, together with
the required attachments, and pay the VAT due
thereon with any Authorized Agent Bank (AAB)
under the jurisdiction of the Revenue District
Office (RDO)/Large Taxpayers District Office
(LTDO) where the taxpayer (head office of the
business establishment) is registered.
Procedures
– Accomplish and submit BIR-prescribed deposit
slip, which the bank teller shall machine validate
as evidence that payment was received by the
AAB. The AAB receiving the tax return shall
stamp mark the word "Received" on the return
and machine validate the return as proof of filing
the return and payment of the tax.
– In places where there are no AAB, file the
Monthly VAT declaration, together with the
required attachments and pay the VAT due with
the Revenue Collection Officer (RCO)
Procedures
– The RCO shall issue a Revenue Official Receipt
upon payment of the tax.
• If there is no payment:
– File the Quarterly VAT Return, together with the
required attachments with the RDO/LTDO/Large
Taxpayers Assistance Division, Collection
Agent having jurisdiction over the registered
address of the taxpayer (head office of the
business establishment).
Reminders:
Only one consolidated Monthly VAT Declaration/Quarterly VAT
Return shall be filed covering the results of operation of the
head office as well as the branches for all lines of business
subject to VAT.
The Quarterly Summary Lists of Sales and Purchases shall be
submitted in Compact Disk-Recordable (CDR) following the
format provided under Section 4.114-3(g) of RR No. 16-2005,
as amended by RR No. 1-2012.

Deadline
Within twenty five (25) days following the close of the taxable
quarter.
THANK
YOU!!!!