Period to Exercise the Right to Examine the Books of Accounts

August 26, 1959 BIR RULING NO. 414-59 Mr. Celestino de Yuchausti 2498 Rosa Maio Singalong, Manila S i r : In reply to your letter requesting information as to the period within which this Office may exercise the right to examine the books of accounts and other accounting records of taxpayers for internal revenue tax purposes, please be informed as follows: The right of this Bureau to examine and/or inspect books of accounts and other accounting records of the taxpayers does not prescribed. Accordingly, the books of accounts and other accounting records of the factory referred to in your letter which were closed on December 31, 1954 may be examined or inspected by authorized internal revenue officers any time. However, section 337 of the Tax Code provides that books of accounts and other accounting records of taxpayers shall be kept for a period of at least five years from the date of last entry and shall be subject to examination and inspection at any time by internal revenue officers. Hence, the taxpayer cannot be compelled to preserve the said books and records for a period of over five (5) years. Very truly yours, (SGD.) MELECIO R. DOMINGO Commissioner of Internal Revenue