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BIR Regulations on Erasures in Manual Official Receipts
(Philippine Legal Context)
1. Introduction
In Philippine taxation, an Official Receipt (OR) serves as prima facie evidence of the sale of services or lease of properties, the amount paid, and the VAT or percentage tax, if any. Because ORs are relied on during audits, the Bureau of Internal Revenue (BIR) keeps a close watch on their integrity. One seemingly simple act—making an erasure or alteration on a manual OR—can trigger penalties, compromise assessments, or even criminal prosecution. This article consolidates every pertinent rule, circular, ruling, and practical consideration on the subject as of 11 May 2025.
2. Statutory & Regulatory Framework
| Source | Key Provision | Relevance to Erasures |
|---|---|---|
| National Internal Revenue Code (NIRC), 1997, as amended | • § 237 (Issuance of Receipts) • § 238 (Printing of Receipts/Invoices) • § 264 (Penalties) | Establishes the duty to issue BIR-authorized receipts and penalizes violations such as “unauthorized alterations” and “falsification.” |
| Revenue Regulations (RR) No. 18-2012 | Consolidates rules on Authority to Print (ATP) and the “no alteration/erasure” rule for manual books of ORs. | |
| RR No. 16-2011 | Clarifies the content and lay-out of principal receipts; alterations require re-issuance, not erasure. | |
| RR No. 15-2010 | Adopts enhanced security features and bar-coding; any erasure voids the security intent. | |
| Revenue Memorandum Order (RMO) 12-2013 | Provides audit guidelines: altered ORs “shall be considered unreliable and subject to disallowance.” | |
| Revenue Memorandum Circulars (RMCs) 68-2016, 14-2021 | Reiterate that receipts with erasures “shall be deemed unissued,” triggering the compromise penalty matrix. | |
| Train Law (RA 10963, 2018) | Raises fine ranges under § 264; thus, OR infractions after 01 Jan 2018 carry higher monetary penalties. |
3. What Exactly Counts as an “Erasure”?
BIR examiners treat any visible overwriting, strike-through, or obliteration as an erasure, regardless of intent. Examples:
- Price Change — crossing out ₱10,000 and writing ₱9,000.
- Date Correction — altering “04-01-2025” to “04-02-2025.”
- TIN Correction — overwriting a mistyped customer TIN.
- Use of correction fluid/tape (“liquid paper”) anywhere on the face of the OR.
Note: A faint double-entry caused by a mis-alignment of carbon paper is usually not treated as an erasure if the underlying figure is still legible and unaltered.
4. The Black-Letter Rule: “No Erasures Allowed”
RR 18-2012, § 5(B)(3) plainly states:
“No erasures, overwriting or alterations shall be made on any invoice or official receipt.”
An OR with erasure is automatically void and considered “unissued” for tax purposes.
The taxpayer must issue a fresh OR bearing the next unused serial number; the voided OR must be retained, stamped “VOID,” and kept intact in the book.
5. Acceptable Corrections (Very Narrow Exceptions)
| Scenario | BIR-Accepted Fix | Conditions |
|---|---|---|
| Minor typographical error in addressee’s “Street/Barangay,” w/o affecting TIN, amount, or tax. | Cross-line once, write correct word above, initial by authorized representative. | Must not obscure tax-critical data; allowed only once per receipt. |
| Carbonless duplicate copies mis-aligned but original is clean. | Keep as is. | No need to void; just note in a memo. |
| Pre-printed info (e.g., phone number) changes mid-book. | Not correctible. Apply for new ATP and print new set of ORs. | Because it affects supplier identification required in RR 16-2011. |
Practice Tip Err on the side of re-issuing rather than correcting. Field agents vary in tolerance, and compromise penalties can outstrip the cost of re-printing a booklet.
6. Procedures for Voiding / Cancelling a Manual OR
- Marking – Conspicuously write “VOID” in red ink across the face.
- Documentation – Prepare an Internal Control Slip indicating: OR number, date, reason for voiding, name & signature of the person who voided, countersignature of supervisor.
- Retention – Keep both original and duplicate/triplicate copies attached to the booklet.
- Serial Integrity – Never tear out the voided leaflet; audit trails must reflect unbroken serial numbers.
- Logbook Entry – Record the void in the Official Receipts Issuance Register per RMO 12-2013.
7. Record-Keeping & Presentation During Audit
Three-Year Prescriptive Period (ordinary assessment) under § 203, NIRC, but keep ORs for ten (10) years if you have pending tax cases (§ 235 as amended by the TRAIN Law).
Altered/erased ORs are tagged as “Unreliable Documents,” leading to:
- Disallowance of input VAT claims;
- Disallowance of expense deductions; and
- Potential shift to Best Evidence Rule (BIR computes sales using 40% gross-profit estimate).
8. Penalties for Violations
| Nature of Infraction | Statutory Basis | Monetary Penalty (Post-TRAIN) | Imprisonment |
|---|---|---|---|
| Issuance of OR with erasures (considered unissued) | NIRC § 264(a) | ₱1,000 – ₱50,000 per receipt | 2 – 4 years |
| Possession of OR without ATP or tampered serial numbers | § 264(b) | ₱50,000 – ₱100,000 | 4 – 8 years |
| Falsification or fraudulent alterations (if intent to evade tax) | § 264(c) & Revised Penal Code Art. 172 | Same as above plus possible estafa or falsification charges | Up to 6 years (RPC) |
Compromise Penalties – The BIR often settles minor OR erasures for single-episode offenders at ₱20,000 to ₱25,000 per finding, but the Commissioner retains discretion.
9. Frequently-Litigated Issues & Jurisprudence
| Case | Citation | Take-away |
|---|---|---|
| BIR v. Fortune Tobacco | CTA EB No. 1912 (2020) | Altered “customer name” considered material; input VAT disallowed. |
| People v. Yu Eng | G.R. L-43266 (Dec 14 1988) | Alterations on receipts constituted falsification under RPC. |
| Ionics EMS v. CIR | CTA Case No. 8998 (2022) | Overstamped corporate logo covering serial no. treated as “erasure.” |
While not all involve manual ORs exclusively, the rulings underscore that any tampering undermining credibility leads to disallowance or conviction.
10. Best-Practice Checklist for Businesses
- Train Cashiers & Billers – A strict “no-correction” policy should be part of onboarding.
- Use Pre-Numbered Stickers – Attach tiny serialized void labels on ORs cancelled due to erasures to simplify audit tracking.
- Immediate Replacement – Issue the replacement OR on the same day to avoid questions about timing.
- Control on Unused Books – Keep manual OR books in a locked cabinet; log withdrawals and returns.
- Upgrade to CAS/e-OR – Consider Computerized Accounting System or e-Invoicing (under RR 9-2021) to eliminate handwriting errors altogether.
- Periodic Self-Audit – Spot-check at least once per quarter; rectify systemic issues before an LOA (Letter of Authority) arrives.
11. Conclusion
Under Philippine tax rules, erasures on manual Official Receipts are essentially taboo. The BIR’s insistence on pristine, unaltered receipts safeguards the credibility of the sales record. Businesses that still rely on handwritten ORs must adopt robust internal controls or migrate to electronic invoicing. Failure to comply exposes taxpayers not only to financial penalties but also to criminal liability. As a rule: when in doubt, void the receipt and re-issue—never erase.
Author’s note: This article synthesizes BIR regulations, circulars, and jurisprudence in force up to May 11, 2025. For pending or future updates—particularly under the BIR’s phased e-Invoicing rollout—monitor new Revenue Regulations or RMCs.