Question & AnswerQ&A (BIR REVENUE REGULATIONS NO. 17-2013)
All taxpayers are required to preserve their books of accounts, including subsidiary books and other accounting records, for a period of ten (10) years reckoned from the day following the deadline in filing a return or from the date of the filing if filed late, for the taxable year when the last entry was made.
Other accounting records include the corresponding invoices, receipts, vouchers, returns, and other source documents supporting the entries in the books of accounts.
Books of accounts and other accounting records shall be kept at all times at the place of business of the taxpayer, and must be produced for inspection upon demand by any internal revenue officer.
The BIR can examine these records beyond the three-year period if there is a pending investigation for fraud or omission discovered within ten years, if there is a waiver of the statute of limitations agreed upon in writing by the taxpayer and Commissioner, or if there is a pending case or claim involving the books.
Section 222 outlines exceptions to the three-year period of limitation on tax assessment, such as a ten-year period for fraudulent or false returns or for failure to file a return, which necessitates retaining books for longer periods.
Violations are subject to penalties under Sections 266, 275, and other relevant provisions of the NIRC, as well as Section 6 of Republic Act No. 10021 (Exchange of Information on Tax Matters Act of 2009).
An independent CPA who audits and certifies financial statements must maintain and preserve copies of such audited and certified financial statements for a period of ten (10) years from the due date or actual date of filing the annual income tax return.
The taxpayer is required to preserve the books of accounts and other accounting records concerned until the case is finally resolved.
"Last entry" refers to a particular business transaction or item that is entered or posted last or latest in the books of accounts when the same was closed.
Yes, these records must be produced and can be inspected outside the place of business upon demand by an internal revenue officer.