How to Cancel Your BIR Certificate of Registration (Form 2303) in the Philippines

Here’s a practical, lawyerly guide—written for Philippine taxpayers—covering when, why, and how to cancel your BIR Certificate of Registration (COR, Form 2303), plus documents, steps, timelines, and common pitfalls. It’s comprehensive but still usable as a checklist.

Scope note: This is general information, not legal advice. Local practices can vary by Revenue District Office (RDO), and rules change—always follow the instructions of your assigned RDO.

1) What “cancelling your COR” actually means

Certificate of Registration (Form 2303) is your proof that you’re registered with the BIR, with the tax types you’re obliged to file (e.g., Income Tax, VAT or Percentage Tax, Withholding, etc.).
Cancellation (a.k.a. closure or deregistration) tells BIR you stopped doing business or stopped doing a tax type, so the system stops expecting returns after a specific cessation date.
Your TIN is permanent. It is not cancelled—only the business registration/tax types are.
Liabilities don’t disappear. BIR can still assess, audit, or collect for periods before the cessation date.

2) When you should cancel (valid grounds)

You should initiate cancellation if any of the following apply:

Business closure / cessation of operations (sole prop, partnership, corporation, or branch).
Non-commencement: You registered but never actually started operations.
Change of organization (e.g., sole prop stops; you formed a corporation/partnership—a separate taxpayer that must register anew).
Change of tax profile
- Cancel VAT if you no longer meet/choose VAT (e.g., below VAT threshold, or transactions become VAT-exempt).
- Cancel Percentage Tax if you move to VAT or your transactions become exempt.
- Cancel Withholding if you no longer have employees/suppliers that require withholding.
Death of an individual proprietor or professional (estate will register separately).
Merger/consolidation/dissolution (corporations).
Branch closure while the head office remains active.
Transfer of business location to another RDO (not a “cancellation” of the taxpayer, but you must update registration; closing an old branch location still requires cancellation of that branch).

3) What continues after cancellation

TIN remains (for life for individuals; corporations keep a TIN until dissolved).
Books and records retention: Keep them for 10 years (practical standard). BIR may still examine prior periods.
Open cases (unfiled returns in the system) and unpaid taxes must be cleared to complete cancellation.

4) Overview of the process (end-to-end)

A. Decide your cessation date

This is the last day you conducted business or held yourself out as doing business (e.g., last day you issued an OR/SI, paid payroll, or rendered services). Use one clear date consistently across filings and documents.

B. Prepare the documentary requirements

Expect your RDO to ask for most or all of the following (exact sets vary):

BIR Form 1905 (Application for Registration Information Update) – tick the relevant “Cancellation/Closure/Deregistration” boxes and specify the cessation date and tax types to cancel.
Original BIR Form 2303 (COR) for surrender.
Unused (unissued) Official Receipts/Sales Invoices
- Prepare an inventory listing by serial numbers and actual count, and surrender the physical booklets for cancellation/annulment.
- Include Acknowledgment/Annulment request for the Authority to Print (ATP) or permit to use (for POS/CAS/loose-leaf).
Books of Accounts (manual/loose-leaf/CAS): present for final stamping/annotation and closure.
Latest filed tax returns and proof of tax payments up to the cessation date (Income Tax, VAT/Percentage Tax, Withholding, DST as applicable).
Inventory of goods and capital assets on hand at cessation (for VAT “deemed sale” computations, if VAT-registered).
Proof of business closure with other agencies (as applicable):
- DTI certificate of business name cancellation (sole prop) or SEC documents (board resolution, dissolution papers) for corporations/partnerships.
- LGU (Mayor’s/Business Permit) closure/clearance, Barangay clearance.
- Lease end/notice to lessor if relevant.
For death of an individual taxpayer: death certificate and estate registration docs; the estate gets its own TIN.
Valid ID of owner/director/authorized rep and SPA/Board Resolution authorizing the representative.

Tip: Bring two sets of everything—one set for filing, one for receiving-stamped copies.

C. File all final/closing returns and pay all taxes due

Income Tax: File for the short period ending on your cessation date (annual and, if applicable, quarterly).
VAT or Percentage Tax: File through the month/quarter of cessation.
- VAT “deemed sale”: remaining inventory/capital goods on hand at cessation can be treated as a deemed sale subject to output VAT—prepare a schedule.
Withholding Taxes (compensation/expanded/final): remit final amounts and file the last monthly/quarterly/annual information returns, including alphalist.
DST if any apply.
Employee final pay: ensure proper withholding and issuance of final BIR Form 2316 to employees.

If you never operated, file “no operations” returns up to the cessation date (unless your RDO accepts an affidavit of non-operation in lieu of zero filings—practices vary).

D. Surrender physical items and update displays

Hand over unused receipts/invoices and books for cancellation.
Return/cancel Ask for a Receipt Notice (NIRI) and any BIR-issued notices/posters.
If you used POS/CAS/loose-leaf, request permit cancellation.

E. Submit your BIR Form 1905 packet at the RDO

Attach all supporting documents.
Get a claim stub/transaction reference.
Some RDOs will ask you to coordinate with the Collection/Compliance section to verify open cases and payments.

F. Expect verification/audit

The RDO may conduct a verification or exit audit to confirm all obligations are paid (especially for VAT and withholding).
Respond promptly to any requests (e.g., schedules, reconciliations, bank statements).

G. Claim the result

When approved, your registration record is updated; your tax types (or branch) will show as cancelled as of the cessation date.
The COR may be stamped “Cancelled” or replaced by an acknowledgment.
Keep the BIR acknowledgment with your records.

5) Special situations & how to handle them

A) Cancelling only a tax type (not the whole business)

Use Form 1905 to cancel VAT (e.g., you fall below the threshold or shift to wholly VAT-exempt activities), or to cancel Percentage Tax, or Withholding if triggers no longer exist.
File the last return for that tax type through the cessation period, then apply for cancellation.

B) VAT-registered businesses closing

Prepare a deemed sale schedule for:
- Ending inventories (goods for sale/use) and
- Capital goods (e.g., equipment) that still have input VAT components.
Compute and pay output VAT on deemed sale in the final VAT return.

C) Non-commencement (you registered but never operated)

Prepare an Affidavit of Non-Operation (include the reason you didn’t commence).
Surrender unused receipts and COR.
Some RDOs still ask for zero returns until the recorded closure date—bring the affidavit and request zero-filing relief if available.

D) Death of an individual taxpayer

Register the estate (separate TIN), file returns up to date of death, settle any taxes.
Use Form 1905 to cancel the decedent’s business registration; the estate handles remaining obligations.

E) Branch closure

File Form 1905 for the specific branch code.
Surrender the branch’s unused receipts and books.
Head office stays active if it continues operations.

F) Transfer to another RDO

This is usually an update, not a cancellation of the taxpayer—file Form 1905 to transfer registration.
If you also close the old location, cancel the branch at the old RDO.

G) Changing entity form (e.g., sole prop → corporation)

Cancel the sole prop’s COR.
Register the corporation separately (new TIN, new COR, new receipts, new books).
You cannot reuse the old COR, ATP, or books.

6) Practical timelines & sequencing

When to file the 1905 packet: As soon as practicable after cessation. Many RDOs expect you to apply promptly (often treated as within about 30 days of cessation for key tax-type changes).
Stop issuing ORs/SIs after the cessation date.
Continue filing returns through the cessation period; don’t wait for approval to file/settle taxes already due.
Expect weeks to months for verification depending on RDO workload and whether an audit is done. (Plan cash flow for any potential assessments.)

7) Fees, penalties, and money matters

Filing Form 1905 itself usually has no fee.
You’ll settle any unpaid taxes, surcharges, and interest discovered during verification/audit.
If you keep filing late while waiting for closure (or stop filing without approval), you can rack up penalties. Always file on time until the tax type shows cancelled in BIR records.

8) Records you should keep after closure

BIR acknowledgment/approval of cancellation.
Received copies of Form 1905 and inventory/annulment of receipts.
Final returns and payment proofs.
Books and source documents (invoices, ORs, bank statements, payroll) for 10 years.
LGU/DTI/SEC closure documents.

9) Common pitfalls (and how to avoid them)

Not filing final returns. Even if you closed, BIR expects returns until your tax type is officially cancelled.
Continuing to issue receipts after your claimed cessation date. That contradicts your closure narrative.
For VAT taxpayers: forgetting the deemed sale computation on remaining inventories and capital goods.
Unreconciled withholding taxes (compensation/expanded) and alphalists left outstanding.
Ignoring branches. Each branch has its own COR/ATP and needs its own cancellation.
No inventory by serial number for unused receipts. RDOs are strict here.
Relying only on LGU closure. LGU closure doesn’t close you at BIR; you must file separately at the RDO.

10) Quick checklists

Individual (sole proprietor/professional)

Fix a cessation date.
Form 1905 (closure; list tax types to cancel).
Original Form 2303.
Unused OR/SI + serial-number inventory; surrender for annulment.
Books of accounts for final stamping.
Final returns (Income Tax; VAT/Percentage; Withholding; DST if any) + payment proofs.
Affidavit of Non-Operation (if applicable).
DTI and LGU closure docs (if applicable).
Valid ID / SPA if using a representative.

Corporation/Partnership

Board resolution on closure/dissolution; SEC filings (if dissolving).
Form 1905 (closure per branch, if any).
Original COR (head/branches).
Unused OR/SI + inventory; ATP/permit cancellation.
Books (head/branches) for stamping.
Final returns (Income, VAT/Percentage, Withholding, DST) + payment proofs and alphalists.
Inventory/deemed sale schedules (if VAT).
LGU closure/clearance(s).
Authorized rep ID + Board resolution/SPA.

11) Sample letter (you can adapt this)

Re: Request for Cancellation of Registration (Form 2303) – [Taxpayer Name, TIN, RDO No.] Date: _____

The Revenue District Officer BIR RDO ____

Dear Sir/Madam:

We respectfully request the cancellation of our BIR Certificate of Registration effective [cessation date] due to [state reason: cessation of business / dissolution / non-operation / branch closure / tax-type cancellation].

Enclosed are BIR Form 1905, original Form 2303, inventory and surrender of unused invoices/receipts, books of accounts for final stamping, final tax returns and payment proofs, and supporting documents (DTI/SEC/LGU as applicable).

We undertake to comply with any additional verification requirements. Kindly update your records accordingly and issue acknowledgment of cancellation.

Sincerely, [Name, Position] [Company/Trade Name] [TIN] [Contact details]

12) FAQs

Can I cancel only VAT but keep the business active? Yes. Cancel the VAT tax type via Form 1905, file the final VAT return (including deemed sale if applicable), and keep your Income Tax (and other relevant tax types) active.

Do I need to keep filing while my cancellation is pending? Yes, until the relevant tax types show as cancelled in BIR records (or the RDO confirms you’re excused). Otherwise, penalties can accrue.

Can I reuse old receipts if I reopen later? No. A new/updated registration requires new ATP/e-invoice authorization and new receipts.

Is LGU closure enough? No. BIR cancellation is a separate process.

What if I registered but never operated? File the 1905 with an Affidavit of Non-Operation, surrender unused receipts, and follow your RDO’s instructions for zero filings.

13) Smart preparation tips

Reconcile early: Match sales per books vs. returns; reconcile withholding vs. alphalists; review input VAT and assets.
Package your file: Tabbed binder (1905, COR, receipts inventory, books, returns, payments, DTI/SEC/LGU).
Name a point person who can respond quickly to RDO queries.
Document your cessation date (last invoice issued, notice to customers/lessor, LGU closure, etc.).

If you want, tell me your tax types, entity form (sole prop, corporation, etc.), and what’s actually happening (full closure, branch closure, or tax-type change). I can tailor a one-page, RDO-ready checklist from this guide.