August 29, 2018 — Small and medium businesses (SMEs) can now use their existing invoices and receipts as non-VAT, in accordance with the new Revenue Regulation that was released by the Bureau of Internal Revenue last August 10, 2018.
Flickr (Camilo Rueda López)
SMEs Reclassified as Non-VAT Due to TRAIN
One of the most notable implications of TRAIN Law (Tax Reform for Acceleration and Inclusion) is the increase of Value-Added Tax (VAT) threshold, from P1.9 million to P3 million.
As we expect, this resulted to many small and medium enterprises’ (SME’s) sudden reclassification from their current VAT status to Non-VAT.
About Revenue Regulations No. 19-2018
Revenue Regulations No. 19-2018 amends the provisions listed within RR No. 13-2018, which focuses on the management of invoices/receipts for VAT, as well as Non-VAT purposes.
With this new provision, existing invoices and receipts permitted by the BIR, can be used as long as “Non-VAT registered as of (date of filing an application for update of registration). Not valid for claim of input tax.” is stamped on every copy of transaction documents.
The taxpayer will also be required to submit new lists of Inventory, as well as cancellation of old stamped transaction documents on the same day upon receiving the newly printed versions of invoices/receipts for non-VAT.
This process will be implemented until new sets of registered non-VAT invoices are printed and received by the taxpayer or until the 30th of August — whichever comes first.
JuanTax Can Help
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