Penalty for Not Issuing a BIR Official Receipt or Invoice: Section 264 and the EOPT Act

A seller who fails or refuses to issue a BIR-compliant receipt or invoice is criminally liable under Section 264(a) of the National Internal Revenue Code, as amended — a fine of ₱1,000 to ₱50,000 plus imprisonment of two to four years upon conviction. In day-to-day enforcement, most first- and second-time findings caught during a BIR tax mapping visit are settled through a smaller administrative compromise penalty instead — but that off-ramp disappears once the same violation repeats.

What does NIRC Section 264 actually penalize? #

NIRC Section 264(a), as amended, criminalizes four distinct acts by a person required to issue receipts or invoices: failing to issue one, refusing to issue one, issuing one that omits required information, and using multiple or double receipts for the same sale. Each act, on conviction, carries the identical fine and imprisonment range — the statute doesn’t grade the four differently at the criminal level, even though the BIR’s administrative compromise schedule does.

“Any person who, being required under Section 237 to issue receipts or sales or commercial invoices, fails or refuses to issue such receipts or invoices, issues receipts or invoices that do not truly reflect and/or contain all the information required to be shown therein or uses multiple or double receipts or invoices shall, upon conviction for each act or omission, be fined not less than One thousand pesos but not more than Fifty thousand pesos and suffer imprisonment of not less than two years but not more than four years.” — Section 264(a) of the National Internal Revenue Code, as amended

The current fine range reflects the increase enacted by the TRAIN Law (RA No. 10963), which amended Section 264 alongside related provisions — a materially higher exposure than the schedule that applied before 2018. The obligation Section 264(a) enforces is the duty to issue set out in NIRC Section 237, so understanding this penalty starts with understanding what Section 237 currently requires a seller to hand over.

How did the EOPT Act change what a seller must issue? #

The Ease of Paying Taxes (EOPT) Act, RA No. 11976, and its implementing RR No. 7-2024 replaced the old split between a sales invoice for goods and an official receipt for services with a single unified document called the “Invoice,” required for both, effective April 27, 2024. A seller who used to issue an official receipt for a service transaction now issues an Invoice instead — the underlying duty to hand something over at the point of sale hasn’t changed, only the document’s name and, for VAT purposes, its role in substantiating input tax.

That distinction matters directly for Section 264 exposure: a seller doesn’t escape liability by pointing to the old goods-versus-services labels. Section 237, as amended by Section 35 of the EOPT Act, requires a non-VAT-registered seller to issue a duly registered invoice once a single sale reaches ₱500, once aggregated daily sales below that amount cross ₱500, or whenever the buyer asks regardless of amount — a VAT-registered seller has no ₱500 exception at all. For the full mechanics of that changeover, including what happened to unused official receipt booklets, see Invoice vs. Official Receipt: What Changed Under the EOPT Act; for the ₱500 threshold from a buyer’s side, see Do You Need a Receipt for Every Small Cash Purchase? BIR Rules Under the EOPT Act.

Is every missed receipt automatically a criminal case? #

No. A first- or second-time failure to issue a receipt, found during an ordinary BIR tax mapping visit and not involving fraud, is normally settled the same day through an administrative compromise penalty under RMO No. 7-2015, not a criminal filing under Section 264. That compromise track is a negotiated alternative to prosecution, not a right — and it runs out.

RMO No. 7-2015’s schedule prices ordinary receipt-issuance violations on a two-tier scale, with RR No. 6-2024 cutting the amount in half for a micro or small taxpayer under RR No. 8-2024’s gross-sales classification, since ordinary failure or refusal to issue a receipt is a non-fraudulent violation of NIRC Section 237:

Two things narrow this off-ramp. First, subsequent violations beyond the second offense are not eligible for compromise at all — the BIR proceeds under the Section 264(a) criminal track from that point. Second, certain aggravated variants — possession or use of multiple or double receipts, or a taxpayer’s copy that understates the amount shown on the purchaser’s copy — are excluded from compromise from the very first occurrence, because the BIR treats them as fraud indicators rather than ordinary non-compliance. See RMO No. 7-2015 Compromise Penalties Explained and BIR Compromise Penalty Table for Registration, Receipts, and Invoicing Violations for the full schedules, and RR No. 6-2024: The 50% Reduced Compromise Penalty for Micro and Small Taxpayers for the discount’s exact scope. This is almost always discovered the same way — through a BIR tax mapping visit, not a desk audit of filed returns.

A worked example: a carinderia owner caught not issuing receipts #

A carinderia owner in a Metro Manila city runs a small eatery with roughly ₱1.8 million in annual gross sales — comfortably a micro taxpayer under RR No. 8-2024’s ₱3 million threshold. Individual meals sell for ₱80 to ₱180, well under the EOPT Act’s ₱500 per-transaction trigger, and the owner has assumed for years that nothing under ₱500 ever needs a receipt.

During an unannounced tax mapping visit at lunch hour, the assigned revenue officers observe roughly two hours of walk-in cash sales — well over ₱500 in aggregate — with no invoice issued at any point, and confirm this against the day’s sales book. Because Section 237 treats aggregated daily sales crossing ₱500 the same as a single ₱500-plus sale for invoicing purposes, this is a Section 237 violation regardless of how small each individual meal was, and it’s logged as a first-offense failure to issue receipts under Section 264.

The owner pays the ₱5,000 compromise and, believing the matter closed, changes nothing about how the counter operates. A follow-up visit eight months later finds the identical pattern — the ₱10,000 second-offense compromise applies, still payable, but the RDO’s file now shows two prior findings for the same establishment. A third repeat would remove the compromise option entirely and put the case on the Section 264(a) criminal track, where the exposure is no longer a fixed peso amount settled that afternoon but a fine-and-imprisonment range decided in a criminal proceeding.

How does a seller fix this going forward? #

Fixing this means issuing an Invoice for every sale as a default habit, not a case-by-case judgment call about whether a given transaction looks small enough to skip. A carinderia, sari-sari store, or similar small seller can close the gap with a few concrete changes:

1. Issue an Invoice at the point of every sale, not only when a customer specifically asks — waiting to be asked is what turns an ordinary small transaction into a Section 237 finding once the day’s sales are added up.
2. Keep the registered invoice booklet or CRM/POS unit at the counter, not in a back office or with an outside bookkeeper, so issuing one is never the reason a line forms.
3. Log daily sales as they happen, so the aggregate-₱500 trigger is something the owner tracks proactively rather than something a revenue officer discovers first.
4. Post the “Ask for Receipt” notice where customers can see it, and treat every direct request as non-negotiable — refusal draws a materially higher compromise than a plain failure to issue.
5. Correct the practice after a first finding, rather than treating the compromise payment as the end of the matter — the RR No. 6-2024 discount and the compromise option itself are both narrower on a second offense and gone by the third.

Frequently asked questions #

What is the penalty for not issuing a BIR receipt or invoice? #

Under Section 264(a) of the National Internal Revenue Code, as amended, a seller who fails or refuses to issue a required receipt or invoice faces, upon conviction, a fine of not less than ₱1,000 but not more than ₱50,000 and imprisonment of not less than two years but not more than four years. In practice, most first- and second-time findings caught during a BIR tax mapping visit are resolved through a smaller administrative compromise penalty instead of a criminal case.

Does the BIR always file criminal charges for a missed receipt? #

No. A first- or second-time failure to issue a receipt, found during an ordinary tax mapping visit and not involving fraud, is typically settled the same day through a compromise penalty under RMO No. 7-2015, paid on BIR Form 0605. Criminal referral under Section 264 becomes the live track once a third violation of the same kind is recorded, or when the finding involves an excluded, fraud-indicating variant such as multiple or double receipts.

What’s the difference between failure and refusal under Section 264? #

Failure to issue means a receipt or invoice simply wasn’t given for a covered sale, without the buyer necessarily asking. Refusal means the seller declined to issue one after being asked. Both fall under the same Section 264(a) fine and imprisonment range, but the BIR’s own compromise schedule treats refusal as the more serious act — its administrative compromise amount is roughly 2.5 times higher than the amount for a plain failure to issue.

Do micro and small businesses get a lower penalty? #

Yes, on the administrative compromise track only. RR No. 6-2024 cuts the RMO No. 7-2015 compromise amount by 50% for micro and small taxpayers on non-fraudulent violations of NIRC Sections 113, 237, and 238, which covers ordinary failure or refusal to issue a receipt. The discount does not touch the Section 264(a) criminal fine and imprisonment range itself, which applies at full strength once a case is referred for prosecution.

Does the EOPT Act change what document a seller must issue? #

Yes. The Ease of Paying Taxes (EOPT) Act, RA No. 11976, and its implementing RR No. 7-2024 replaced the old split between a sales invoice for goods and an official receipt for services with a single document called the “Invoice,” required for both, effective April 27, 2024. The Section 264(a) duty to issue traces back to NIRC Section 237, so a seller who still issues nothing at all — regardless of what the document used to be called — remains exposed to the same penalty.

Summary #

Section 264(a) of the National Internal Revenue Code, as amended, makes failing or refusing to issue a receipt or invoice a criminal offense — a fine of ₱1,000 to ₱50,000 and two to four years’ imprisonment upon conviction — but the BIR resolves most first- and second-time tax mapping findings through a smaller RMO No. 7-2015 compromise penalty instead, cut 50% further for micro and small taxpayers under RR No. 6-2024. The EOPT Act changed the document’s name from separate sales invoices and official receipts to a single Invoice, not the underlying duty to issue one at every covered sale. For the buyer-side view of when a receipt is legally owed, see Do You Need a Receipt for Every Small Cash Purchase? BIR Rules Under the EOPT Act; for the full invoicing changeover, see Invoice vs. Official Receipt: What Changed Under the EOPT Act; and for handling the visit where this violation is usually found, see BIR Tax Mapping Checklist: How to Handle a Surprise Compliance Visit Like a Pro.