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RMC No. 98-2026: E-Invoicing System Downtime and How to Correct an Electronic Invoice

·4 mins
Guides eFPS BIR Compliance Tax Updates

RMC No. 98-2026 does not let a system outage become an excuse to skip invoicing — a covered taxpayer whose electronic invoicing system fails must issue a BIR-authorized manual invoice for the sale, then replace it with a matching electronic invoice once the system is back online. The circular treats downtime as an operational interruption to work around, not a reason to stop documenting transactions.

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What must a taxpayer do when its e-invoicing system goes down? #

A taxpayer must issue a BIR-authorized manual invoice for every sale during a system failure, internet outage, power interruption, cybersecurity incident, or similar disruption — the transaction still has to be documented in real time, just through the manual fallback instead of the electronic system. Multiple independent summaries of the circular describe the same sequence:

  • During the outage: issue a duly BIR-authorized manual invoice for each transaction, as though the electronic system were never available.
  • Once the system is restored: replace every manual invoice issued during the downtime with a corresponding electronic invoice that references the original manual invoice number, so the two documents are linked in the taxpayer’s records.
  • Record-keeping: all manually issued invoices from the downtime period must be recorded and retained for audit and reporting purposes, alongside their electronic replacements.

Downtime does not excuse the underlying invoicing duty #

A taxpayer cannot treat a system outage as grounds to stop issuing invoices altogether — the obligation to document every sale, barter, exchange, or transaction continues regardless of whether the electronic system is working. As reported in connection with RMC No. 98-2026’s downtime provisions:

“The occurrence of system downtime or technical issues shall not exempt the taxpayer from the obligation to issue an invoice for every sale, barter, exchange, or transaction, nor from compliance with record-keeping and reporting requirements prescribed by the Bureau.”

— as summarized from RMC No. 98-2026 by VATupdate’s coverage of the circular’s downtime provisions

This is a meaningful operational detail for a business planning its e-invoicing rollout: the manual-invoice fallback is not optional infrastructure to skip because “the system should just work” — a covered taxpayer needs a documented manual-invoice procedure ready before its December 31, 2026 compliance date, precisely because outages are the scenario the circular anticipates rather than ignores.

A worked example: a retailer’s connectivity outage #

Consider a mid-sized retail chain already issuing compliant electronic invoices at each branch, when one location loses internet connectivity for four hours during a busy afternoon. Under RMC No. 98-2026’s framework, the cashier at that branch does not stop ringing up sales — each transaction during the outage is documented on a BIR-authorized manual invoice instead. Once connectivity returns later that day, the branch’s back office re-enters each of those manually invoiced transactions into the electronic system, generating a corresponding electronic invoice for each one that carries a reference back to its original manual invoice number. Both the manual invoices and their electronic replacements are retained together in the branch’s records, so an auditor reviewing that day’s sales can trace every transaction from its manual origin through to its final electronic form.

Why this matters alongside the PTI application and coverage rules #

The downtime procedure is one piece of a larger implementation picture this site covers across several RMC No. 98-2026 posts. For which businesses are covered by the December 31, 2026 deadline and what counts as a valid electronic invoice in the first place, see RMC No. 98-2026: Which Businesses Must Switch to Electronic Invoices; for the Permit to Issue Electronic Invoice application and EIS Certification process a taxpayer completes before any of this applies, see How to Get a BIR Permit to Issue Electronic Invoice; and for how this interacts with choosing a compliant point-of-sale or accounting system in the first place, see How to Choose an EIS-Compliant POS or Sales Data Transmission System.

Summary #

RMC No. 98-2026 requires a covered taxpayer to keep invoicing through a system outage, not pause during one — issuing a BIR-authorized manual invoice for each sale during downtime, then replacing it with a corresponding electronic invoice referencing the manual invoice number once the system is restored, with both records retained for audit purposes. System downtime or technical failure is explicitly not a basis to skip the underlying duty to invoice every transaction. A taxpayer preparing for the December 31, 2026 deadline should have this manual-invoice fallback procedure documented and ready, not just a working electronic system.

Sources #

Primary source

  • Bureau of Internal Revenue — 2026 Revenue Memorandum Circulars index (citation of record for RMC No. 98-2026, issued September 22, 2026). The circular’s own PDF was not independently retrievable from the BIR’s CDN in this research session; the facts above are corroborated across the secondary sources below.

Secondary sources