To many Filipino business owners, regulatory compliance is a tedious and tiresome affair. Some are even tempted to put their compliance matters on the backburner in favor of other concerns, like sales, and only revisit their regulatory compliance at the very last minute. But while it’s true that compliance may not be a revenue-generating aspect of doing business, it is still worth prioritizing. This is especially true of any compliance requirements that come from the Bureau of Internal Revenue, or BIR.
If you’re currently modernizing your company with a computerized accounting system, or CAS, there’s a pressing need to ensure that you are BIR CAS compliant. Registering your CAS and updating your procedures for full BIR compliance will save you from steep penalties. A good compliance record will also set a precedent for a good relationship with the tax collection agency.
How should you go about your BIR CAS compliance, and what requirements should you prepare? Here’s a briefer on everything you need to know about the process.
Revenue Memorandum Order No. 1-2009 requires all large taxpayers to upgrade to a CAS and register their chosen system at the BIR. But the right to use a CAS isn’t exclusive to these large companies. Small and medium-sized businesses can also choose to adopt a CAS as long as they follow the same compliance requirements.
The short answer to this question is yes. All companies that intend to use a CAS for their accounting procedures, regardless of whether they are mandated to by law or choose to do so of their own volition, must register their CAS at the BIR.
The same companies should also register anew at the BIR in case they adopt a major system enhancement or modification to their existing CAS. The scope includes changes to the functionality of the system, any addition or subtraction of modules or sub-modules, and other changes that will have an impact on the major financial aspects of the system. Minor system enhancements to the CAS, like bug fixes, require a brief letter of notification to the business’s Revenue District Office, or RDO.
As per Revenue Memorandum Order 29-2002, the BIR requires a CAS to contain the following components:
You should prepare the following documentary requirements for your BIR CAS registration:
For applications for system enhancements or modifications, you’ll need to pass a copy of your previous BIR Permit to Adopt CAS and a letter to the agency detailing the modification or enhancement to your CAS.
These requirements may be subject to change in the future. Be sure to double check with an authorized representative of the BIR before you finalize your registration.
Those who are new to the process of registering their CAS may think that the process is exceedingly difficult. But the BIR recently released Revenue Memorandum Circular No. 5-2021, which has streamlined the process of application and made it easier for businesses to adopt their own computerized accounting systems.
Before this circular was issued, any company that wanted to register a CAS had to go through a system demo or pre-evaluation by BIR officers. Companies were also required to wait for a Permit to Use, or PTU, before they could implement their new CAS. As of this writing, BIR no longer requires a system demo or the issuance of a PTU. First-time CAS registrants only need to submit their documentary requirements for registration and wait three working days for an Acknowledgment Certificate before rolling out their CAS.
BIR may have simplified its CAS compliance requirements, but first-time owners of a CAS may still have the jitters about staying compliant. If you’re nervous about onboarding a new CAS and fulfilling the BIR’s requirements, don’t hesitate to contact ANSI Information Systems.
After more than three decades of working with Filipino businesses, we’ve also gained some expertise about how to work with the Philippine government. Let us help you with the red tape as well as the particulars of onboarding your new CAS. Call ANSI Information Systems now, and make us your partners in your BIR CAS compliance journey.