Section 113. Invoicing and Accounting Requirements for VAT-Registered Persons. -

1. Invoicing Requirements. -

   A VAT-registered person shall issue:

   1. A VAT invoice for every sale, barter or exchange of goods or properties; and

   2. A VAT official receipt for every lease of goods or properties, and for every sale, barter or exchange of services.

2. Information Contained in the VAT Invoice or VAT Official Receipt. -

   The following information shall be indicated in the VAT invoice or VAT official receipt:

   1. A statement that the seller is a VAT-registered person, followed by his taxpayer's identification number (TIN);

   2. The total amount which the purchaser pays or is obligated to pay to the seller with the indication that such amount includes the value-added tax: Provided, That:

      1. The amount of the tax shall be shown as a separate item in the invoice or receipt;

      2. If the sale is exempt from value-added tax, the term "VAT-exempt sale" shall be written or printed prominently on the invoice or receipt;

      3. If the sale is subject to zero percent (0%) value-added tax, the term "zero-rated sale" shall be written or printed prominently on the invoice or receipt;

      4. If the sale involves goods, properties or services some of which are subject to and some of which are VAT zero-rated or VAT-exempt, the invoice or receipt shall clearly indicate the breakdown of the sale price between its taxable, exempt and zero-rated components, and the calculation of the value-added tax on each portion of the sale shall be shown on the invoice or receipt: "Provided, That the seller may issue separate invoices or receipts for the taxable, exempt, and zero-rated components of the sale.

   3. The date of transaction, quantity, unit cost and description of the goods or properties or nature of the service; and

   4. In the case of sales in the amount of one thousand pesos (P1,000) or more where the sale or transfer is made to a VAT-registered person, the name, business style, if any, address and taxpayer identification number (TIN) of the purchaser, customer or client.

3. Accounting Requirements. -

   Notwithstanding the provisions of Section 233, all persons subject to the value-added tax under Sections 106 and 108 shall, in addition to the regular accounting records required, maintain a subsidiary sales journal and subsidiary purchase journal on which the daily sales and purchases are recorded. The subsidiary journals shall contain such information as may be required by the Secretary of Finance.

4. Consequence of Issuing Erroneous Vat Invoice or Vat Official Receipt. -

   1. If a person who is not a VAT-registered person issues an invoice or receipt showing his Taxpayer Identification Number (TIN), followed by the word "VAT":

      1. The issuer shall, in addition to any liability to other percentage taxes, be liable to:

         1. The tax imposed in Section 106 or 108 without the benefit of any input tax credit; and

         2. A 50% surcharge under Section 248 (B) of this code;

      2. The VAT shall, if the other requisite information required under Subsection (B) hereof is shown on the invoice or receipt, be recognized as an input tax credit to the purchaser under Section 110 of this Code.

   2. If a VAT-registered person issues a VAT invoice or VAT official receipt for a VAT-exempt transaction, but fails to display prominently on the invoice or receipt the term "VAT-exempt Sale", the issuer shall be liable to account for the tax imposed in Section 106 or 108 as if Section 109 did not apply.

5. Transitional Period. -

   Notwithstanding Subsection (B) hereof, taxpayers may continue to issue VAT invoices and VAT official receipts for the period July 1, 2005 to December 31, 2005, in accordance with Bureau of Internal Revenue administrative practices that existed as of December 31, 2004.