Gotta love this website for helping to stay sane while dealing with this country and the mental giants living here.
So after finding out that the previous accountant didn’t actually file the tax returns and pocketed the tax payment, all the while dragging out the excuse for not providing the official receipt (I’m not completely stupid you know) for three months by blaming in on the BIR for not giving the turd a receipt due to waiting for the final closure of the old business…. but being provided a duly stamped tax return “proving” they actually paid the tax money to the BIR. Can you say fixer?
I found a new accountant and in the process of getting all the receipts together for the new accountant/dong I learned much about Filipino accounting standards.
First is the joy of sorting through receipts from a country that is too damned stupid to agree upon a standardized date format like the rest of the world. Is 1/3/2014 January third or is it actually March 1st? You see the damned point of sale registers use different formats for the date and you have to look up in the spreadsheet/bookkeeping software when the receipt was posted to figure out what the date really is.
Oh, and that spiffy electronic bookkeeping software like Quicken? You don’t really use that for taxes, you use paper ledgers. Yes, the old columnar pads from the 1970’s are the accepted manner of keeping books here. Yes, you can “register” your electronic software and actually use it but be prepared for a hassle and extra expense. So you keep “internal” books on modern software and also have the transaction posted in the paper journal as required by the BIR. In the U.S. this is called two sets of books and can earn you a long vacation with free room and board with new friends named Bubba and Shank.
So you go through the emails finding all the receipts cause you were smart enough to demand a scan of every receipt as the money was spent by your Pinoy manager, bless her thieving black heart. And you learn that there are more receipts than purchases cause the thieving botch (no typo there) was erasing receipts and resubmitting a few of them. Not a lot, just taking advantage of their position which any self respecting Pinoy is going to do, why else would they accept responsibility and a job but if not to steal? You being the clever Kano did check the amounts but did you track serial numbers on the receipts? Nope, and a Pinoy with a 85 IQ got one over on you.
Not a lot, under 20K over a few million pesos but once you get your hands on the original invoices you see the erasures that looked just fine once they were scanned and emailed to you.
And the fines…. oh how they love to warn you that you owe fines because some low life thieving 85 IQ Pinoy pocketed the tax payments the last three months while telling you that the receipts were delayed because of the closure of the business, that the tax returns was filed and they even gave you a stamped copy of the dang thing after you expressed doubt. Duly manufactured with the help of a scanner of course and a fixer. And my God the enormity of the fines. 1000 pesos… yep, under $25 bucks… about the only saving grace of the entire mess.
And the cost of the tax return? $250 for the return and about eight or nine freakishly long, totally redundant and useless forms. So you are out around a grand or so from the invoice/receipt theft, fake tax return and unpaid taxes. A little wiser to the sheer amount of effort they will use to steal a few hundred dollars.
And yes, they have electronic methods of submitting some of the reports… if you have Windows XP on your computer. See the XP is free, no charge, nada dinero, so the flips in government base their software on XP and later versions won’t run the software. You show up at their office, they download it onto your thumb drive, and you go back to your office to find that the software won’t function properly unless you have XP operating system.
So heads up if you are operating a business here. Print out all receipts and closely check the serial numbers on the official BIR receipts. Take the time to eyeball the actual receipts when you visit, check each one against the scanned copy, and the rule is no receipt, no payment of salary till the receipt is produced. Yes you would think that anyone of intelligence will realize that they will get caught but remember that you are doing business in the Philippines.