Keeping up with e-invoicing

With the Philippine tax system undergoing digital transformation, Revenue Regulation (RR) 11-2025, issued by the Bureau of Internal Revenue (BIR), marks another step toward this transition. The shift to electronic invoicing and sales reporting promises greater transparency, efficiency and accountability for both taxpayers and tax administration. Aside from planning for compliance, businesses may see this as a strategic opportunity to streamline operations and align with global best practices in tax digitization.

Issued to implement Sections 237 and 237-A of the Tax Code, RR 11-2025 outlines who must issue electronic invoices (e-invoices), how the e-invoices must be formatted and transmitted, and when the transition must take place.

Under RR No 11-2025, the following taxpayers are mandated to issue e-invoices in a structured data format:

1. Taxpayers engaged in e-commerce or internet transactions, classified as small, medium, large taxpayers, (micro taxpayers are exempted);

2. Taxpayers under the jurisdiction of the Large Taxpayer Service;

3. Taxpayers classified as Large Taxpayer under Republic Act (RA) 11976, or the Ease of Paying Taxes Act and RR 8-2024; and

4. Taxpayers using Computerized Accounting Systems, Computerized Books of Account with e-invoicing capability and other invoicing software.

Additional groups will be mandated once the BIR develops a system that is capable of storing and processing the required data. These include exporters, registered business enterprises availing themselves of tax incentives, taxpayers using point-of-sale systems, and other taxpayers as may be subsequently required by the Commissioner.

The RR requires that invoices be issued in a structured data format that can be electronically extracted and transmitted to the BIR.

Businesses that already use CAS or digital invoicing systems should assess compatibility with BIR’s technical requirements. Early preparation can prevent costly disruptions when full e-reporting is implemented and becomes mandatory on the part of taxpayers qualified under the RR.

Under RR 11-2025, the initial group of covered taxpayers was originally required to comply by March 14, 2026. However, the BIR issued RR 26-2025 extending the deadline to Dec. 31, 2026.

With the issuance of RR 26-2025, businesses should take advantage of the extension to prepare, test and strengthen their tax processes and systems. Tax compliance is a continuous obligation. As the tax landscape evolves, businesses must remain vigilant and proactive in monitoring updates to tax requirements to ensure timely compliance and avoid potential penalties for non-compliance.

Horace Irvinson Lope is an associate under the Tax Group of R.G. Manabat & Co. (KPMG in the Philippines), a Philippine partnership and a member firm of the KPMG global organization of independent member firms affiliated with KPMG International Limited, a private English company limited by guarantee. The firm has been recognized as a Tier 1 in Transfer Pricing Practice and in General Corporate Tax Practice by the International Tax Review. For more information, you may reach out to Horace Irvinson Lope or Mary Karen Quizon-Sakkam through [email protected], social media or visit www.home.kpmg/ph.