If you’re a business owner in the Philippines, you’ve probably heard about Revenue Regulation (RR) No. 7-2024, part of the Ease of Paying Taxes (EOPT) Act. This regulation changes how Sales Invoices and Official Receipts are used, affecting goods sellers and service providers. Knowing which document to issue is now more important than ever to stay compliant and avoid penalties.
What Are Sales Invoices and Official Receipts?
A Sales Invoice (SI) is a primary document issued when selling goods, properties, or services. It serves as the official proof of sale for tax purposes and is used to compute Value-Added Tax (VAT) and percentage tax. Invoices typically include the seller’s and buyer’s names, TINs, addresses, description of items sold, quantities, prices, and total amounts.
Service providers have traditionally issued an official receipt (OR) when payment is received. It acknowledges that money has been collected for services rendered or goods sold on a cash basis. In the old system, an OR was the main proof of transaction for services, while a Sales Invoice was the proof for physical goods.
What Changed Under RR 7-2024
Before RR 7-2024, the rule was simple:
- Goods → Sales Invoice
- Services → Official Receipt
RR 7-2024 makes the Sales Invoice the primary proof of sale for all transactions—whether for goods, properties, or services. The Official Receipt is no longer the main evidence for services. Instead, it’s classified as a supplementary document.
This update simplifies tax compliance and aligns documentation with international best practices. Here’s a table to visualize the new changes:
| Before RR 7-2024 | After RR 7-2024 |
| Goods/Properties → Sales Invoice Services → Official Receipt | All Transactions → Sales Invoice |
| OR was the primary proof of sale for services | OR = Supplementary document only |
| OR and SI had separate roles for BIR tax filings. | Sales Invoice is now the universal primary document. |
When to Issue a Sales Invoice
Under RR 7-2024, a Sales Invoice should be issued when:
- Selling goods or properties, whether for cash or on credit.
- Providing services, regardless of payment method.
- Making advance billings for goods or services.
In other words, whether you’re a retailer, a contractor, a consultant, or a service-based freelancer, the Sales Invoice is now your go-to primary document. It applies even if you receive payment later since the issuance is based on the transaction, not just the payment.
When to Issue an Official Receipt
The Official Receipt can still be used, but it’s optional and only supplementary. Businesses may issue ORs to acknowledge payment, especially if clients request them for their internal record-keeping.
You might choose to issue an OR if:
- Your client’s internal processes require it.
- You want to give customers an additional payment acknowledgment aside from the invoice.
- You’re in industries where ORs are part of long-standing business practice.
In short, an OR is no longer the primary proof of sale for tax purposes and is not strictly mandatory for the BIR. However, remember that this does not affect your obligations with other government agencies or authorities, which may still require you to issue and record Ors.
Can You Issue Both a Sales Invoice and an Official Receipt?
Yes, but it’s not mandatory. You can issue both documents if:
- Your business wants to maintain traditional practices while adapting to the new rules.
- You should provide clients with both a billing document (invoice) and a payment acknowledgment (receipt).
Just be careful not to issue both for the same purpose—the Sales Invoice is your legal proof of sale, while the OR simply acknowledges payment. Issuing both is fine as long as it’s clear which document serves which role.
Key Takeaways for Business Owners
RR 7-2024 changes long-standing practices for Philippine businesses. Here’s what you need to remember:
- Sales Invoices are now required for all transactions—whether for goods, properties, or services.
- Official Receipts are supplementary and cannot replace an invoice for tax purposes.
- Ensure your point-of-sale systems, cash registers, and accounting software reflect the updated document labels.
- Train your staff so everyone knows when and how to issue the correct document.
By adapting early, you can avoid confusion, stay compliant, and make the transition smoother for your business and clients.
Do You Need Assistance Staying Compliant with BIR Regulations?
Keeping up with BIR regulations can be challenging, especially with the constant changes every year. From issuing the correct tax documents to meeting strict filing requirements and deadlines, compliance demands careful attention. Errors, missing requirements, or late submissions can result in penalties, delays, or rejected filings.
That’s where Triple i Consulting comes in. Our team of experienced lawyers and accountants provides comprehensive support for your business registration, so you don’t have to stress over the paperwork.
Contact us today to schedule an initial consultation with one of our experts:
- Fill out the form below
- Call us at: +63 (02) 8540-9623
- Send an email to: info@tripleiconsulting.com
