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![[Ask The Tax Whiz] What is tax compliance verification drive also known as tax mapping?](https://www.rappler.com/tachyon/r3-assets/612F469A6EA84F6BAE882D2B94A4B421/img/0F01F82F9BC74C439BD3E94C25ED0737/bir-building_970b19fb3f3c4c57942bafcc1067e1bd_b3cbc3d097d54e00ab19b0149e8976ab.jpg)
The Philippine tax whiz explains the purpose of TCVD and the importance of taxpayers' compliance in fulfilling their responsibilities
1. I’ve just opened a store and completed all the paperwork needed to register my business. However, I’m still confused about what I need to do for the tax mapping or TCVD. Can you explain what I need to prepare?
The registration of businesses with the Bureau of Internal Revenue comes with the expectation that they are aware of their obligations. Below is a checklist of documents the BIR may verify during the TCVD.
Also, it is our duty to make sure that the Revenue Officer who will be doing the tax mapping is authorized. Here are the steps to make sure that they are authorized to conduct the tax mapping:
- Know your Revenue District Office number. Only those within the area of the RDO will be allowed to conduct the TCVD in your business.
- Ask for their ID and they should provide a mission order which is a letter from the BIR that authorizes the following Revenue Officer to conduct the TCVD.
2. What is the purpose and importance of adhering to the guidelines on tax mapping, and how would it impact my business?
The drive aims to strengthen tax compliance, reduce tax evasion, and promote fairness in the tax system. By identifying non-compliant taxpayers, it helps prevent fraudulent activities, ensures that all eligible revenue is collected, and enhances the efficiency of the tax system.]
This is one of the ways the BIR ensures compliance is through its Tax Compliance or Verification Drive or tax mapping. The program operates by having the bureau send a BIR revenue staff unannounced to a business site to inspect a business and confirm whether it complies with the registration, bookkeeping, invoicing, and other rules required by the bureau. This is not an actual examination of the books of accounts and other accounting records but rather a verification of compliance with the basic regulations required.
3. What will happen if I fail to prepare my business for tax mapping?
Generally, the penalties range from P1,000 to P50,000, depending on the severity of the nature of the violation.
Penalties for tax mapping are as follows:
Under the Ease of Paying Taxes (EOPT) Act, the BIR ceased to collect the annual registration fee (BIR Form 0605) of P500 effective January 22, 2024, meaning the penalty of P1,000 for failure to pay and display the BIR Form 0605 do not effect.
Please note that these are not payable on the spot. You do not need to pay cash to anyone, instead the Revenue Officer will list down all the violations in a Violation Checklist, accomplish the Taxpayer’s Information Sheet (TIS), and explain the said violation including the basis. The taxpayer can also appeal and explain its side to the Revenue Officer.
The said violation has its corresponding penalties which the taxpayer needs to pay through the AABs Failure to do so, the BIR will issue a Second Opportunity Notice (SON) and Last Opportunity Notice (LON) before ultimately filing the appropriate criminal charges before the Prosecutor’s Office.
For a detailed list of penalties, you may direct to this link. – Rappler.com
The information provided in the article above is for general knowledge and information. #GotQuestionsaboutTaxes? We’re always happy to hear from you! If you want to know how these regulations affect your business, CONSULT ACG or email us at consult@acg.ph.
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