BIR Compromise Penalties for Cash Register Machine (CRM) and POS Compliance Failures: A Checklist

RMO No. 7-2015’s compromise schedule flags two narrower cash register machine (CRM) and POS-level requirements — a two-roller-tape condition and a permitted-location rule — without printing a specific peso compromise figure for either. Both trace to Revenue Regulations No. 10-99 and No. 11-2004, and both are checklist items a business running CRM or POS equipment should verify before a tax mapping visit, even though the schedule doesn’t attach a stated fine to them the way it does to using an unregistered machine outright.

For the CRM/POS violations that do carry clear, stated compromise amounts, see BIR Compromise Penalty Table for Registration, Receipts, and Invoicing Violations; for the current PTU-to-Acknowledgement-Certificate registration process, see Do You Still Need a Permit to Use (PTU) for Your POS or CRM Machine?

Does a cash register machine need two rollers? #

Yes — Section 2.5 of RR No. 10-99, carried forward by Section 5.2 of RR No. 11-2004, conditions a machine’s permit on it being equipped with two rollers (or their equivalent): one for an audit journal tape and one for the customer’s itemized, consecutively numbered receipt tape. The regulation’s own text:

Section 2.5, RR No. 10-99 — “The machine should be equipped with two (2) rollers or its equivalent, one for the audit journal tape intended for audit and internal revenue purpose and the other for the customer’s tape which are issued as itemized and consecutively numbered receipts, PROVIDED, THAT, all tapes issued is of a quality that could be preserved for a period of within which the Commissioner is authorized to make an assessment and collection of the taxes so assessed as prescribed in Section 203 and 222 of National Internal Revenue Tax Code, as amended; c) When the machines is punched for the purpose of recording a sale, amount of sales should automatically printed on the customer’s tape receipt and on the audit journal tape or its equivalent.”

A machine missing the audit-tape roller, or one where the two tapes don’t record the same amount automatically, doesn’t meet this condition — a finding RMO No. 7-2015 lists without stating a specific compromise figure.

Can a CRM or POS machine be used anywhere the business operates? #

No — Section 10.3.4 of RR No. 11-2004 requires a machine to stay at, and be used only at, the location specified in its BIR permit, and a change of business name, machine use, or location requires prior written notice to the BIR office with jurisdiction over the principal place of business. The regulation’s text:

Sec 10.3.4, RR No. 11-2004 — “Use of CRM/POS or similar devices in a place other than specified in the permit. (Section 10.3.4 — The machine user shall not change his business name or the use of the registered machine, or transfer to another business location, branch or establishment or otherwise, without prior written notice to the bureau office having jurisdiction over the principal place of business of the proprietor.)”

This item is closely related to — but distinct from — the notification requirement covered in Do You Need to Notify the BIR Before Transferring, Repairing, or Upgrading Your CRM or POS Machine?: that post covers the failure to notify; this one covers actually using the machine at the wrong location regardless of whether notice was ever given.

CRM/POS compliance checklist #

Frequently asked questions #

What CRM/POS requirements does this checklist cover? #

This post covers two specific RMO No. 7-2015 schedule items: the requirement that a cash register or POS machine be equipped with two rollers (one audit tape, one customer tape) under Section 2.5 of RR No. 10-99 and Section 5.2 of RR No. 11-2004, and the requirement that a machine only be used at the location specified in its permit under Section 10.3.4 of RR No. 11-2004.

Do these two violations carry a specific peso compromise amount? #

No. RMO No. 7-2015’s Annex C lists both as violations without printing a specific compromise figure in the schedule’s amount column, unlike most of the CRM/POS registration and invoicing violations around them.

Why does a cash register need two rollers? #

Under RR No. 10-99, Section 2.5, one roller is the audit journal tape kept for BIR and internal revenue purposes, and the other is the customer’s tape issued as an itemized, consecutively numbered receipt — the machine must automatically print the sale amount on both tapes simultaneously when it’s used, so the audit copy and the customer copy always match.

What happens if a business moves a CRM or POS machine to a new location without updating its permit? #

Using the machine at a location other than the one specified in its BIR permit is a separate finding from simply failing to notify the BIR of the move — see Do You Need to Notify the BIR Before Transferring or Repairing Your CRM or POS Machine? for the related notification requirement under Section 10.3.5 of RR No. 11-2004.

Where else in this schedule do CRM/POS violations carry a clear peso amount? #

Use of an unregistered cash register machine in lieu of receipts carries a clearly stated ₱25,000-per-unit (first offense) to ₱50,000-per-unit (second offense) compromise under NIRC Section 264 — see BIR Compromise Penalty Table for Registration, Receipts, and Invoicing Violations for that and the other clearly priced invoicing items.

Summary #

Two CRM/POS machine-level rules — the two-roller-tape requirement and the permitted-location rule — sit in RMO No. 7-2015’s schedule without a stated peso figure, unlike the more visible unregistered-machine and missing-sticker violations covered elsewhere on this site. Neither being unpriced makes either optional: both are real regulatory requirements a tax mapping officer can flag, and both are worth checking before a visit rather than after one.