There is one piece of paper on a shelf in the office: Form 2303, the certificate of registration we received from the BIR. Under the company's name and address, it lists the tax types this company pays. Ours has 5 lines. Those 5 lines decide what we file and when.
KAZENA Books has a screen that shows, as a list, the returns due for the month. When I assembled that list, what went on it was decided from the ledger. If there were withholding entries, the withholding return appeared. If there were sales, the sales return appeared. I thought the reasoning held. A return for a tax type with no transactions was not something I could see a reason for at the time.
August's list showed 3 returns. The paper has 5 lines. Of the 2 that had gone missing, 1 was missing because not 1 transaction of that kind happened in August. The office paid no professional fees that month. With no tax to deduct there were no entries, and with no entries the return did not appear on the list.
A tax type you are registered for is filed even in a month with no transactions. You file it with 0 inside. I learned that from our accountant, and I learned it on a day 11 days past the due date. While they were going over the quarterly list, they asked what had happened with August's.
We filed the late return that day. The penalty and the addition came to 2,310 pesos. As an amount it is small. What stayed with me was that I had thought we had done nothing wrong. The books agreed. The tax owed was 0. All that remained was the fact that it had not been filed, and that was the result of the software putting on the screen that there was nothing to file.
The mistake in the other direction was on the same screen. The table of tax types that comes with the product carries tax types that are not on our paper. September's list had 1 return for a tax type we are not registered for, because the ledger held entries that looked like it. Something we did not have to file was showing, and something we did have to file had gone. The list was wrong in both directions.
I think the core of it is a single thing: I worked the obligations backwards out of the ledger. A ledger is a record of what happened. An obligation is settled on paper before anything happens. The 2 run in a different order, and the earlier one cannot be decided from the later one.
The repair moved the source of the list from the ledger to the paper. The tax types listed on the paper, and the filing frequency of each, are entered once by a person at the start. A tax type that has been entered appears on the list even in a month with 0 transactions. A tax type that has not been entered does not appear, whatever the ledger holds. The ledger decides amounts. What decides the number of obligations is the paper.
Here I misread one thing. The paper changes. Adding a tax type and dropping one both mean the paper is rewritten and received again. I had held the entry as the 5 lines we have now, and past months were being judged by those 5 lines too. I was looking at July's list through lines that did not exist in July.
I added to the entry a date saying which paper it came from, held per line. Open a past month and the list is assembled from the lines in force that month. After that went in, we opened every month back to January again and a person checked by eye whether the count on the list matched the paper. Across 9 months, 2 did not match. Both were my own errors in how the dates had been entered.
On the list screen, next to the name of each return, we put which line of the paper it comes from. The wording is short. We phrased it as being based on the certificate of registration, so that looking at the paper shows the same things in the same order. If you cannot read off the screen where an obligation came from, nobody can check the reason when it grows or shrinks.
In the 2 months since, returns going missing from the list came to 0. 3 returns with 0 inside came up, and all 3 went out inside the deadline. Tax types we are not registered for do not reach the screen.
I estimated 1 day and it took 6. Changing the source of the list was half a day. The rest was re-holding the dates per line, opening 9 months again, and settling the 1 that had gone out late. The reason I miss estimates is always the same: the repair is code and the reconciliation is the past, and I forget that every time.
One note. I am not a tax practitioner. This is a record of our own work, and decisions about which tax types you are registered for and what you file should be confirmed with a professional.