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When to start counting 10-year period for preservationThe counting of the preservation would start from the last entry on the books ofaccounts referring to a particular business transaction or an item thereof that isentered or posted last or latest in the books of accounts when the same wasclosed.Notably, registration of new sets of manual books of accounts is uponconsumption of its pages so that if you have in your books of accountstransactions for five (5) years, then, such books of accounts should be preservedfor a total period of fifteen (15) years.Obligations of CPA’s to preserve AFS for 10 yearsAn independent certified public accountant (CPA) who audited the books ofaccounts and other accounting records of the taxpayer has the responsibility tomaintain and preserve copies of the audited and certified financial statements fora period of ten (10) years from the due date of filing annual income tax return oractual date of filing thereof, whichever comes earlier, unless a longer retentionperiod is required under the National Internal Revenue Code of the Philippines(NIRC), as amended, or other relevant laws.Place of Preservation of Books of Accounts in the PhilippinesAll books, registers and other records, and vouchers and other supporting papersrequired by the BIR shall be kept at all times at the place of business of thetaxpayer. Books of accounts may be inspected by the BIR and examined forpurposes of the following:Regular audit,Extraordinary audit,Requests for exchange of information by a foreign tax authority under Sections 6and 71 of the NIRC, and,In the exercise of BIR Commissioner’s power to obtain information under Section 5of the NIRC,Examination of books of accounts may be made in the taxpayer’s office or placeof business or in the office of the BIR.PRESERVATION OF BOOKS OF ACCOUNTS All books of accounts, including the subsidiary books and other accountingrecords of corporations, partnerships or persons shall be preserved by themwithin 3 years (except in case of a false or fraudulent return) from the last entry ineach book and for which period the Commissioner is authorized to make anassessment.The said books and records shall be subject to examination and inspection by
internal revenue officers made only once in a taxable year, except in the followingcases:1. fraud, irregularity or mistakes as determined by the commissioner; 2. the taxpayer requests reinvestigation;3. verification or compliance with the withholding tax laws and regulations and4. In the exercise of the commissioner’s power to obtain information from otherpersons, in which case, another or separate examination and inspection may bemade.REGISTRATION REQUIREMENTSEvery person subject to any internal revenue tax shall register once with theappropriate Revenue District Officer:1. within 10 days from date of employment2. on or before the commencement of business3. before payment of any tax due4. upon filing of a return, statement or declaration as required in the tax code.