Permit to use Loose-leaf Books of Accounts

Are you tired of maintaining a manual book of accounts and handwriting your numerous business transactions? Why not try applying for a loose-leaf book of accounts? With this, you can electronically record your business transactions using your personal computer. Although the use of loose-leaf books is computer-aided, it is still considered as manual recording with the BIR.

In applying for a loose-leaf book of accounts, taxpayers must file an application first for a “Permit to Use” (PTU) to their local BIR Revenue District Office. As per Revenue Memorandum Circular (RMC) No. 68-2017, the evaluation and approval of the said application will require the following:

  1. Duly accomplished BIR Form No. 1900;
  2. Sample format and print-out to be used (books of accounts);
  3. In lieu of the investigation pursuant to RMC No. 13-82, a Sworn Statement specifying the following:
    1. Identifying the type of books that will be used.
    2. Commitment to permanently bind the loose-leaf forms within fifteen (15 days) after the end of each taxable year or upon termination of its use.

The BIR may request additional requirements, including:

  1. Proof of payment of BIR Form No. 0605 – current annual registration fee.
  2. If the application is filed by an authorized representative of the taxpayer, a Board Resolution, Secretary’s Certificate, or Special Power of Attorney is required. This should also be accompanied by a valid ID of the authorized representative.

Normally, the BIR requires at least the following books to be submitted annually:

  • General Journal
  • General Ledger
  • Cash Receipts Book
  • Cash Disbursement Book
  • Subsidiary Sales Book
  • Subsidiary Purchases Book

Once the application of PTU for loose-leaf books of accounts is approved, the taxpayer is required to print out the encoded transactions using the BIR-approved format, and have them bound and submitted to the BIR within fifteen (15) days after the end of the taxable year.

Source: Revenue Memorandum Circular No. 68-2017