BIR rules on VAT sales/purchases reports

Legal basis, policy framework, purpose

The SLSP reporting system supports the Reconciliation of Listings for Enforcement (RELIEF) System for VAT administration.
The RELIEF System is designed to support third party information programs and voluntary assessment functions through cross-referencing third party information from taxpayers’ quarterly SLSP.
RELIEF relies on SLSP submitted in magnetic form on a quarterly basis under Revenue Regulations Nos. 7-95, as amended by RR 13-97, RR 7-99, and RR 8-2002.
The order’s stated objectives are to ensure monitoring and immediate processing of data from VAT taxpayers, delineate functions of offices/divisions/units, provide timely and accurate reports for audit and management, provide concerned office data for accurate VAT credit/refund processing, and enforce administrative sanctions and criminal case filing for non-compliant taxpayers.

Key terms and definitions established

Magnetic Form means a 3.5 inch floppy diskette.
A “Good” diskette is one that is free from virus(es) (GD), whose files are readable by the system, conform with the prescribed electronic format, are validated, and are successfully uploaded to the RELIEF system.
A “Defective” diskette is one that is infected with virus(es) (DV) and/or whose files are inaccessible or not readable by the system (DR) and/or whose data files have invalid formats (DF) that do not conform with the prescribed electronic format.
Regular buyers/customers are buyers/customers engaged in business or exercise of profession with whom the taxpayer transacted at least six (6) times in the previous year or current year, regardless of amount per transaction.
Casual buyers/customers are buyers/customers engaged in business or exercise of profession with individual purchase/transaction amounting to P100,000 or more, but not qualifying as regular buyers/customers.
Taxable quarter means the quarter synchronized to the income tax quarter of the taxpayer (calendar or fiscal quarter).
Secure area means an area free from dust and moist to preserve diskette life and protected from unauthorized use or loss.
File means one transaction type (sales, local purchases, and importation) per month.

Coverage, thresholds, and quarterly reporting rules

The RELIEF System covers VAT taxpayers above the threshold limits set by RR 8-2002 who must submit SLSP in magnetic form using a prescribed electronic format.
Quarterly SLSP are required in magnetic form, and hard copies of SLSP need not be submitted.
VAT taxpayers with quarterly sales/receipts exceeding P2,500,000 must submit quarterly Summary List of Sales.
VAT taxpayers with quarterly total purchases exceeding P1,000,000 must submit quarterly Summary List of Purchases.
Only the Summary List of Sales must be submitted when the VAT taxpayer reaches the sales threshold; only the Summary List of Purchases must be submitted when the VAT taxpayer reaches the purchases threshold.
Threshold determination includes taxable (net of VAT), zero-rated, and exempt transactions.
Once the threshold amount is reached for sales or purchases, the VAT taxpayer must submit the applicable summary lists for the next three (3) succeeding quarters, regardless of whether succeeding taxable quarter sales or purchases exceed the threshold amounts.
The Quarterly SLSP must be submitted to the RDO, LTDO or LTAD having jurisdiction over the taxpayer on or before the due date for filing of VAT return, which is the twenty-fifth (25th) of the month following the close of the taxable quarter (calendar or fiscal quarter).
Submission must be in an electronic format using either excel format, the taxpayer’s own extract program, or the BIR data entry module; if excel or the taxpayer’s extract program is used, the electronic data must be validated using the validation module developed by the BIR.
The Quarterly Summary List of Sales must contain monthly total sales from both regular buyers/customers and casual buyers/customers with individual sales amounting to P100,000 or more.
The Quarterly SLSP must consolidate monthly sales/purchases per customer/seller arranged alphabetically, while the Quarterly Summary List of Importation must be arranged chronologically per individual transaction for each month of the taxable quarter.
Detailed SLSP contents are governed by Revenue Memorandum Circular No. 24-2002.
Failure to indicate the buyer’s TIN in the sales schedule does not affect the seller, but may be a ground for audit of the buyer, or both buyer and seller.

Diskette quality, filing consequences, administrative penalty

Only good diskettes upon submission are considered filed/submitted.
Defective and partially defective diskettes submitted before the deadline must be replaced on or before the deadline.
Defective and partially defective diskettes submitted on the deadline are considered late.
Taxpayers must resubmit/replace defective diskettes within five (5) working days from the date of return.
Failure to submit/replace the SLSP in magnetic form triggers penalties under the pertinent provisions of the Tax Code and regulations and triggers an audit.
Each transmitted item is counted based on transaction type per month: one transaction type per month constitutes one file, and transaction types are sales, local purchases, and importation.
An administrative penalty of P1,000 for each failure is imposed, with an aggregate cap not exceeding P25,000 for all such failures during a taxable year, for neglect to file, keep, or supply the statement, list, or information required on the prescribed date.
For administrative penalty purposes, each failure to supply required information for each buyer or seller constitutes a single act or omission.
The administrative penalty must be paid upon notice and demand by the CIR.
Willful failure by the person to keep records and supply correct information at the required time(s) is subject to criminal penalty under the relevant provisions of the Tax Code of 1997, upon conviction.
Imposition of Tax Code penalties and compromise of criminal liability does not relieve the violating taxpayer from the obligation to submit the required documents.
Unauthorized divulgence or retrieval of RELIEF data and/or other TPI data by any revenue official/employee is referred to the concerned offices for imposition of administrative sanctions and filing of appropriate charges.
Required reports must be submitted electronically through e-mail, and concerned offices must acknowledge them using the same facility; for non-computerized districts, reports must be transmitted in diskettes.

Processing flow and responsible BIR units

Taxpayer Service Section (TSS) of the RDO/LTDO/LTAD receives SLSP diskettes with a duly filled out Diskette Acknowledgement Report (ANNEX A-1) in two copies, and requires resubmission of the Diskette Acknowledgement Report for replacement diskettes.
The TSS verifies timeliness and completeness of taxpayer information (including RDO Code, TIN, registered name, contact person, owner’s telephone number, month and year of listings, and filenames contained) on the diskette label and imposes penalties for late submission.
The TSS assigns a control number in the Diskette Acknowledgement Report and records taxpayer information in the Diskette Register (Annex A-2) using the following format: RDO Code (first three (3) digits), “R” to represent RELIEF, Year (next two (2) digits), Month (next two (2) digits), Day (next two (2) digits), Serial Code (last five (5) digits).
The TSS stamps “Received”, returns one copy to the taxpayer, and notifies that if later found defective, replacement is required within five (5) working days from notification.
The TSS scans diskettes for viruses and checks RELIEF data files to identify condition (GD, DV, DR, or DF) and records the condition on the diskette stick-on label and Diskette Acknowledgement Report.
The TSS returns defective diskettes with a copy of the Diskette Acknowledgement Report and requires replacement within five (5) working days from the date of return.
The TSS electronically transmits all SLSP data received from VAT taxpayers to RDC/ISOS-DC on a daily basis and records status and reasons if electronic transmission fails.
The TSS forwards checked diskettes and the accomplished Diskette Acknowledgement Report for updating the Diskette Register, segregates good from defective diskettes, prepares transmittal lists for good and defective diskettes, and forwards them to the Document Processing Section and TSS Chief as directed.
The TSS Chief files defective diskettes by control number for retrieval and sends a Request for Replacement of Diskette/s (Annex A-4) to taxpayers via e-mail, fax, registered mail, or personal delivery.
The TSS matches the Document Processing Section/Large Taxpayers Document Processing and Quality Assurance Division list with the Diskette Register to monitor compliance and prepares a Monthly List of Non-compliant VAT Taxpayers (Annex A-5) at month-end.
If taxpayers fail to submit SLSP or replace defective diskettes, the TSS sends a Preliminary Notice (Annex A-6) by registered mail or personal delivery and imposes penalty for late submission; if still non-compliant after five (5) days from Preliminary Notice issuance, it sends a Final Notice (Annex A-7).
Upon second offense, the matter is referred for issuance of subpoena duces tecum, and on the third offense, a criminal case is initiated against the taxpayer.
The TSS prepares and forwards reports on or before the 15th day of the second month after the end of each calendar quarter: Quarterly Summary of Diskettes Received/Rejected/Transmitted (Annex A-8) and Quarterly Report on VAT Taxpayers’ Compliance (Annex A-9), using the stated distribution copies.
The TSS reconciles RDC/ISOS-DC electronically received/transmitted summaries with diskette-received/rejected/transmitted summaries, resolves discrepancies, receives Monthly Lists of Unsuccessfully Uploaded Data from SOD, and requires re-transmittal within five (5) working days from receipt.

Document preparation, monitoring reports, upload/upload failure

The Document Processing Section of the RDO/LTDPQAD prepares a Masterlist of All VAT Taxpayers (Annex A-10) as of June 30, 2002 and every year-end thereafter, to be submitted to AITEID not later than the 15th day after the period.
The Document Processing Section prepares the initial and updated lists of VAT taxpayers required to submit SLSP using VAT return data filed for the second quarter of 2002, updating quarterly by adding newly covered taxpayers and deleting those no longer required.
The Document Processing Section provides a copy of the list/updated list to the TSS and AITEID on or before the 15th day of the second month after the end of the taxable quarter for monitoring.
The Document Processing Section receives from the TSS transmittal lists of taxpayers who submitted good diskettes and keeps good diskettes alphabetically in a secured area after electronic transmission to RDC/ISOS-DC.
The Regional Office/Large Taxpayers Service receives the quarterly summaries and compliance reports and monitors RDO/LTDO reporting compliance.
The Regional Office/Large Taxpayers Service prepares consolidated reports for submission to AITED on the 20th day of the second month after the end of each calendar quarter, including Annex B consolidated diskette summaries and Annex B-1 compliance reports with stated distributions.
The RDC/ISOS-DC receives electronically the SLSP data files, creates and maintains an automatic backup file locally for excel download or as needed, and retains data for three (3) years minimum to ten (10) years maximum.
RDC/ISOS-DC prepares and distributes the Quarterly RDC/ISOS-DC Summary of Electronically Received and Transmitted Data (Annex C) on or before the 20th day of the second month following each quarter end.
RDC/ISOS-DC reconciles file counts received and transmitted and prepares an RDC Exception Report for discrepancies.
The Systems Operations Division (SOD) receives SLSP data electronically through RDC/ISOS-DC, uploads data daily to a Data Warehouse, and prepares a Monthly List of Unsuccessfully Uploaded Data (Annex D) requiring RDO re-transmittal.
SOD prepares and distributes the Quarterly SOD Summary of Electronically Received and Uploaded Data (Annex D-1) on or before the 20th day of the second month after quarter end and issues an SOD Exception Report for discrepancies.
The AITEID receives multiple reports for monitoring compliance and refers discrepancies for resolution, monitors and evaluates overall performance by regional offices, and submits to MANCOM through DCIR-OG not later than the 30th day of the second month following the deadline for submission of SLSP a consolidated quarterly report of compliance results.

Supersession and effect

The order supersedes all prior revenue issuances or portions thereof inconsistent with its provisions.
The order takes effect immediately upon adoption.