9 Facts You Should Know on Tax Mapping

text with clock for bir tax mapping

As a business owner, you’re responsible for knowing and complying with the requirements of the BIR (Bureau of Internal Revenue). One such requirement is tax mapping – ensuring your taxable income is correctly reported to the BIR. Non-compliance can result in bir tax mapping violations, so it’s important to know what constitutes a tax mapping violation and how to avoid penaties during tax mapping. This post will outline the basics of tax mapping and highlight some of the most common violations. We’ll also provide tips on how to stay compliant and avoid penalties. So, if you’re curious about BIR tax mapping or want to ensure you’re on track, keep reading!

What is Tax Mapping Meaning?

What is tax mapping? Or what exactly is the meaning of this tax mapping? Well, it is a surprise visit of the BIR staff to the establishment. This tax mapping in the Philippines aims to inspect compliance with business registration and other rules and regulations of the Bureau of Internal Revenue. Therefore, it is also commonly known as BIR tax compliance or “Oplan Kandado.”

This tax mapping BIR will help them monitor and identify those who are evading from paying taxes.  Do you know what will happen if you are caught that your business is not legally complying with the requirements? Let’s see the tax mapping system.

If you don’t want to read, watch this video!

Tax Mapping System Philippines

Any BIR representative does this tax mapping at random dates and places. Non-compliance with the BIR regulations is subject to a penalty from one thousand pesos (1 000) up to fifty thousand pesos (50 000) depending on the nature of violations.

Some non-compliance to the regulation will lead to a permanent closure of the business establishments and imprisonment of the owner.

BIR Tax Mapping Violations

showing table for the tax mapping penalties

During the tax mapping, the BIR staff follow tax mapping checklists. If the BIR conducts tax mapping in your area, make sure you’re fully aware of these BIR tax mapping violations.

BIR Registration Requirements:

  1. Not Register with BIR
  2. Failure to pay the annual fee registration fee  (BIR Form 0605) and not visible in your business facilities.
  3. The sign or poster “Ask for BIR receipts” is not correctly placed in your business are.
  4. No Certificate of Registration and Notice to the Public displayed

BIR Invoicing Requirements

  1. Refusal to issue receipts or sales invoices
  2. You are issuing unregistered receipts or invoices to the clients. For example, if you were value-added tax registered, can you still issue your vat written permit? Yes, you can still give these vat registered receipts even you’re no longer qualify as a vat registered. To learn more read, this VAT Invoices Update under Train Law 2018.
  3. We are not issuing official receipts or sales invoices.

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Other BIR Tax Mapping Violations

  1. Failure to withhold or remit withheld taxes at the time or times required by law or regulations
  2. Failure to file and or pay any internal revenue tax at the time or times required by law or regulations
  3. Failure to keep or preserve records required by law or regulations
  4. Tax Mapping Penalties in the Philippines

Subject to Compromise Penalties

  1. Failure to pay the annual registration fee or display in the business is subject to 1,000 per year or during the tax mapping.
  2. Failed to secure a certificate of registration and notice to the public display, failure to display the sign “Ask for BIR Receipts” are subject to 1,000 during tax mapping
  3. Failure to register the business with BIR is subject to according to the location. Twenty thousand for cities, 10 000 for 1st class municipalities; 5, 000 for 2nd class municipalities, and 2 000 for 3rd class municipalities.
  4. Refusal to issue receipts or sales invoices and issuing unregistered permits are subject to 25 00 for the first offense and 50 000 for the second offense.
  5. Failure to issue receipts or other invoices is subject to 10 000 for the first time and 20 000 for the second time.

Subject Criminal and Compromise Penalties

Failure to make/file/ submit any return or supply correct information at the time or times required by law or regulations. This violation is subject to a fine of 10 000 and imprisonment of not less than one (1) year but not more than ten (10) years. Compromise is determined based on the gross sales, earnings or receipts, or gross estate or gift. Here is the tax table for compromise penalties.

Failure to make/file/submit any return or supply correct information at the time required by law or regulation. It is subject to a fine of not less than P10,000 and imprisonment of not less than one (1) year but not more than ten (10) years.

Failure to File Certain Information Returns. If you intentionally or willfully neglected certain information, it is subject to 1,000 fines for each failure but should not exceed 25 000 within a calendar year.

Tips On How To Prepare For Tax Mapping In The Philippines

Are you a business owner in the Philippines? Are you preparing for tax mapping this year? If not, you should be. Tax mapping is a necessary process that helps the government identify businesses operating within the law. To make the process as smooth as possible, here are some tips on preparing for tax mapping in the Philippines.

1. Make sure your business is not illegal in the BIR:

Tax mapping is only possible for registered and compliant businesses with the Bureau of Internal Revenue. This means that your business must have a valid tax identification number, and you must be up to date on your filing and payment obligations. If your business is not registered or compliant, you will not be able to take advantage of tax mapping.

Related: 25 Ways to Reduce Your Tax Burden as a Small Business in the Philippines

2. Make your registration documents visible; these are the BIR Certificate of Registration (BIR Form 2303), Notice to the Public “Ask for Receipts” signage, and lastly, the Annual Registration Fee (BIR Form 0605):

Before-tax mapping begins, you must register your business with the BIR and have a valid tax identification number. You will also need to ensure that your registration documents are visible in your place of business. These documents include the BIR Certificate of Registration (BIR Form 2303), the Notice to the Public “Ask for Receipts” signage, and the Annual Registration Fee (BIR Form 0605).

3. Always pay the annual registration fee on or before January 31st of each year.:

The annual registration fee is a tax that must be paid by all businesses registered with the BIR. This fee is used to finance the government’s tax administration program. You must pay the price on or before January 31st of each year, and failure to pay the fee can result in penalties.

4. Register your Cash Registered Machine (CRM) or Point of Sales Machine (POS) to the Bureau of Internal Revenue (BIR):

If your business uses a Cash Register Machine (CRM) or Point of Sales Machine (POS), you must register the machine with the BIR. You will need to complete a tax declaration form and submit it to the BIR office nearest you. The form must be signed by the owner or manager of the business, and it must be accompanied by a copy of the machine’s registration certificate.

Related: The Best Bookkeeping Softwares In The Philippines

5. Attach the original authorization sticker to any device in your business.:

The authorization sticker is a document that must be attached to any device used in your business that is capable of storing data. The sticker must be visible and easy to read, and it must contain the following information:

  • The name and address of the business
  • The tax identification number of the business
  • The date of purchase or importation of the device
  • The serial number of the device

6. Use prescribed manuals or invoices by the BIR.:

The BIR has prescribed several manuals and invoices that businesses must use. These include the following: the National Official Receipts Issuance Manual, the National Uniform Invoice Issuance Manual, the National Sales Invoice Issuance Manual, and the National Cash Register Machine Issuance Manual.

7. Make sure to issue receipts or invoices for every transaction:

Businesses must issue receipts or invoices for every transaction. The receipt or invoice must contain the following information: the name and address of the business, the tax identification number of the business, the date of the transaction, the particulars of the transaction, and the amount of tax paid.

8. Maintain a registered book of accounts and record the business transactions:

All businesses must maintain a registered book of accounts. This book must contain a record of all business transactions, and you must keep it up to date. Companies are required to submit their books of accounts to the BIR every quarter.

Related: The Ultimate Guide to Bookkeeping For Beginners 2022

9. Pay the taxes monthly, quarterly, and annually, including those withholding taxes from the employees and others who withhold taxes:

You must pay these taxes either monthly, quarterly, or annually. It includes income tax, value-added tax, withholding tax, and other taxes. Failure to pay taxes can result in penalties.

Related: De minimis Benefits and a 90,000 Tax Exemption Philippines

FAQs About Tax Mapping In The Philippines

1. What are the requirements for tax mapping?:

The criteria for tax mapping are as follows:

  • A tax declaration form
  • A copy of the machine’s registration certificate
  • The original authorization sticker
  • The prescribed manuals or invoices

2. What is the annual registration fee?:

The annual registration fee is a tax that must be paid by all businesses registered with the BIR. This fee is used to finance the government’s tax administration program. You must pay the fee on or before January 31st of each year, and failure to pay the fee can result in penalties.

3. What are the prescribed manuals or invoices?:

The BIR has prescribed several manuals and invoices that businesses must use. These include the following: the National Official Receipts Issuance Manual, the National Uniform Invoice Issuance Manual, the National Sales Invoice Issuance Manual, and the National Cash Register Machine Issuance Manual.

4. What is the registered book of accounts?:

The registered book of accounts is a book that all businesses must maintain. This book must contain a record of all business transactions, and you must keep it up to date. Businesses are required to submit their books of accounts to the BIR quarterly.

Related: FAQs under CREATE Law

5. What are the taxes that you must pay regularly?:

All businesses must pay taxes regularly. Taxes must be paid monthly, quarterly, and annually. This includes income tax, value-added tax, withholding tax, and other taxes. Failure to pay taxes can result in penalties.

6. What is the annual registration fee used for?:

The annual registration fee finances the government’s tax administration program. you must pay the fee on or before January 31st of each year, and failure to pay the fee can result in penalties.

7. How often do I need to renew my tax mapping registration?:

You will need to renew your tax mapping registration on an annual basis. The renewal fee is the same as the annual registration fee. Failure to renew your registration can result in penalties.

8. What are the consequences of not complying with tax mapping?:

The results of not complying with tax mapping can include fines and penalties and the suspension or revocation of your business license. Additionally, you may be subject to criminal prosecution.

9. Can I appeal a decision made by the BIR?:

Yes, you have the right to appeal any decision made by the BIR. Appeals must be made within 30 days of the decision, and they must be made in writing. The BIR will review your request and issue a decision within 60 days.

10. Can BIR do Tax Mapping During Non-Business Hours?

Yes. If necessary, the BIR may do tax mapping during non-business hours to prevent tax evasion. 

Conclusion

As a business owner in the Philippines, it’s essential to understand tax mapping and how you can prepare for it. Tax mapping is a crucial process that helps the government identify businesses operating within the law. If you’re not ready for tax mapping, you could face BIR tax mapping violations resulting in penalties. However, there are ways to make the process as smooth as possible. Here are some tips on preparing for tax mapping in the Philippines and avoiding penalties during tax mapping. Need help? Contact us today for assistance!

Recommended:How to Get TIN Number Online and Verification Process

12 Replies to “9 Facts You Should Know on Tax Mapping”

  1. Hi! I wasn’t able to register any books of accounts because I wasn’t advised by BIR to do so when I was applying as a self-employed individual. What to do

    1. What do you mean the BIR doesn’t advice you to get your Books registered? It’s one of the requirements as a freelancer or self-employed that you maintained the books of accounts. What’s the nature of your business?

  2. Hi Sir,
    What if na tax map ng 2021. Can they go back to previous years? CAS received 2020 pero wala for 2019.

  3. Hi Sir,
    What if 2021 tax mapping, CAS received for year 2020 but none for 2019(but not tax mapped). Will they go back to previous years? Thank you.

  4. Hi, paano po pag nawala yung Notice to the public “Ask for Receipt” poster po? Ano po dapat gawin? Hindi pa po kami na tax map , gusto po sana namin resolbahin agad ang problema na to. Sana po eh matulungan niyo ako.

  5. Good day! I am from Dipolog City, it say’s in the article that tax mapping penalty is base on location, my violation is “Failure to Register” and our location is a 3rd Class municipality. Pero hinihingan kami ng 10k penalty, and 5k last price nila, ano po talaga ang tama? Sana masagot po. Salamat.

  6. Halo poh. Paano po if na tax mapped kami tapos yong violation po is failure to register. Small business lang po.Kaso po 3 months lang po nag operate kiconsume ko lang yong 2 months advance ko po na renta Kasi maliit talaga ang kita.tapos mag close na ako. Kailangan ba talagang bayaran ang 20,000?
    Salamat po

  7. Hi may motorshop po kame tapos nagdidisplay kame ng ibang panindang mga damit pero d nmn sya gaano kadami at trial palang if malakas b or mahina bawal po b un? Magpepenalty po b kame

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