Frequently Asked Questions on RR 7-2024

We recently published an article about the BIR new rules on receipts. For those who are still seeking for clarity, here are the top questions that we received from different customers and taxpayers with regard to RR 7-2024.

1. What are the specific changes introduced by BIR RR No. 7-2024 regarding receipts and invoices?

RR No. 7-2024 introduces a shift from Official Receipts to Invoices for documenting sales transactions. Businesses MUST issue invoices for sales or services valued at P500 or more, with adjustments for inflation every three years.

VAT-registered businesses MUST issue invoices regardless of the transaction amount. Official Receipts are no longer mandatory but can still be used optionally or converted to invoices following specific guidelines.

2. How do I convert my remaining Official Receipts into invoices, and is approval required from BIR?

To convert unused Official Receipts into invoices, strike through the term “Official Receipt” and replace it with “Invoice” or a similar term.

Ensure these converted documents contain all required invoice information, including a prominent serial number, seller’s registered name, TIN, business address, and breakdown of sales if applicable. No approval from BIR is needed for this conversion, but businesses must obtain new invoices with an Authority to Print (ATP) before December 31, 2024, or before using up the converted Official Receipts.

3. What information must be included in an invoice to comply with the new BIR regulations?

Invoices must include:

• Seller’s registered name, TIN, and business address.
• Statement of VAT registration status.
• Label “Invoice” clearly printed on the document.
• Date of the transaction.
• Space for buyer’s details (not mandatory for B2C transactions).
• Prominent serial number.
• Quantity, unit cost, and description of goods or services.
• Total sale amount, with VAT shown separately.
• Breakdown of sales if applicable.
• Additional information for specific transactions.

4. How does Taxumo help in complying with the new invoicing regulations?

If you need to change your official receipts into invoices (have new ones printed), you can message customercare@taxumo.com and we will ask one of our partner CPAs / processors help you out.

Also, If you are in need of an online invoicing solution – join our waitlist to get early access through this reservation link.

5. What should I do with my remaining Official Receipts, and can I still use them after the new regulation takes effect?

Businesses can continue using their remaining Official Receipts as supplementary documents until they are used up. These receipts must be stamped with “THIS DOCUMENT IS NOT VALID FOR CLAIM OF INPUT TAX” upon the regulation’s effective date. Alternatively, businesses can convert unused Official Receipts into invoices by following the conversion guidelines. These converted documents are valid for input tax claims until December 31, 2024, provided they contain all required invoice information.

6. Can you discuss more about claiming VAT?

Each invoice now should have the breakdown indicated on the side. It should include VATable sales, zero-rated sales, VAT-exempt sales, and 12% VAT. So in the picture of the invoice above, VAT cannot be claimed for that since there is no breakdown.

Also, for non-VAT sales invoices, you should print “THIS DOCUMENT IS NOT VALID FOR CLAIM OF INPUT TAX” in bold letters at the face of the invoice. For transactions under VAT-exempted, it’s a must to have the word “EXEMPT” clearly indicated on the document.

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