The e-Tax Invoice Initiative
Imagining you are walking to your office passing piles of documents and reports stacking beside tables of your staff, it is the time for real paperwork revolution starting from the accounting department. We have been talking about paperless notion for several years but the accounting work can get very slow progress when comparing with other business functions such as in money transfer, customs clearing, etc.
Many companies in Thailand still continue the old way of working with paper documents which include making several copies of invoices, distributing to requesting parties for keeping in the files, matching them with another copy obtained from other sources and so on. This can involve more than 10 people to review and process a piece of paper. The big issue of producing the paper document is concerned with the tax invoice.
According to the VAT requirement under the tax law, VAT registered companies are required to comply with the law in many aspects starting from the format, minimum content, filing, reporting and correcting process when mistakes happen. All these cause burden in complying with the law, especially when the company is in the position of getting the VAT refund back from the government. The responsible accountant has to make sure that all legal documents are properly compiled and ready for examination by the revenue officers. Otherwise, the refunding process can be delayed longer than expectation.
Is it possible to produce an e-tax invoice?
Just like other important documents such as checks that have been replaced by the electronic banking transactions, it may be worth considering how to implement the e-tax invoice so that huge quantity of paper can be reduced and also its associated cost. There are a few concerns to be raised up for suitable solutions as follows:-
• How to control the issuance of a tax invoice generated by a legal entity?
• How to make sure that the receiving parties are using the correct tax invoice?
• How to check the VAT filing for the net amount paid or claimed?
In order to achieve the e-tax invoicing target, we may need to combine the best practices employed by the banking industry (payment transaction authorization) and the credit card control process (quantity control and verification). The following steps may be one of several ways to implement this idea:
1. Through the VAT registering request, a company informs the designated authority or an authorized private entity regarding the invoice number structure and the range thereof to be used for normal document generation. This will be done through the web based system.
2. Once an invoice is issued, minimum information will be updated to the VAT filing system. The details can be forwarded to users internally and externally.
3. Information contained in an e-tax invoice can be linked to other systems the company is using such as inventory, account receivable, account payable, fixed asset, general ledger and so on.
4. By the end of each month, the net VAT amount will be automatically calculated and can be submitted to the Revenue department as required by the law.
5. Authorization has to be set up and assigned based on the company’s policy.
These simple steps will become practical only with cooperation and support from concerned parties including private organizations (as a debtor or creditor of the transaction), the Revenue department, and the end users. However at the initial phase, the joint application between purchasing and selling companies may be made through the designated invoice confirmation and control agency.
Let’s make a drastic change for better efficiency and advanced working style for the future of our business systems.
By Mr.Yanyong Thammatucharee
email: yanyong.thammatucharee@gmail.com
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