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[Ask The Tax Whiz] Are scanned receipts and invoices considered as original documents?

The Philippine Tax Whiz discusses whether a scanned copy of a receipt or invoice is considered an original document and its difference from an electronic document pursuant to the E-Commerce Act

Are there specific requirements for an electronic document to be considered as an original document?

Republic Act (RA) No. 8792 or the E-Commerce Act specifies that for an electronic document to be considered an original document, the document must comply with the following requirements:

To determine whether the integrity has been preserved, the information must remain complete and unaltered, apart from the addition of any endorsement and any change which arises in the normal course of communication. Moreover, in determining reliability, the document will be assessed in light of all relevant circumstances.

Also, the original receipt or invoice as well as the electronic receipts or invoice shall be kept by the customer or purchaser and the duplicate shall be kept by the issuer for three years from the close of the taxable year in compliance to Sec. 237 of the Tax Code.

If a company intends to put a computerized accounting system (CAS) where suppliers directly send them scanned copies of the invoice/receipt, can it still be considered as original documents?

No, the scanned copies of receipts or invoices are not considered as original documents. For an electronic document to be considered an original document, its integrity must be shown via another source (i.e., the original document or the hard copy) which, in this case, does not exist.

Under the E-Commerce Act, the concept of an “electronic document” does not encompass scanned copies. The purpose of the act is to treat paperless or electronic documents with the same legal function as original or printed documents. However, scanned copies of documents are not electronic documents since they naturally come from original printed copies.

Thus, the electronic receipts or invoices provided under Sec. 237 of the Tax Code pertain only to  documents generated electronically and without existing print-out or hard copies.

Since it was mentioned that the original receipts or invoices shall be kept and preserved for a period of 3 years, does it mean the preservation of the receipts or invoices  beyond that 3-year period is no longer required?

Under RR No. 5-2014, accounting records (which includes invoices, receipts, vouchers, returns, etc.) must be kept and preserved for a period of ten (10) years. For the first five years, the taxpayer must keep the hard copies of such receipts and invoices, but for the succeeding five years, may keep only an electronic copy of such documents.

The reason for the 10-year retention period is so that these documents can be examined in cases of  investigation for falsity, fraud, or omissions in paying taxes.

If you have clarifications with the scanned copy of a receipt or invoice, you may get in touch with us through the TaxWhizPH Mobile App.

Originally published via Rappler

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