DGII says electronic invoicing will be enforced nationwide by 2025

[aarhus]

Currently, the reporting of sales and the associated taxes collected is done via manual, self reporting. It seems this new system will integrate a company's POS with the DGII so that the amounts will be reported automatically for each transaction.

This will reduce the underreporting of taxes collected.

When a company makes a sales to a consumer and collects 100.00 in ITBIS, they self report and remit that amount by the 20th of the following month. My understanding of this new system is that the 100.00 of ITBIS will be reported automatically at the time of sale. This eliminates the chance to exclude some sales for the self reporting way and pocket the taxes collected.

I have not seen one man shops (barbers, salons, colmados, roadside produce stands, etc.) issue invoices with tax credit as it is now so this new electronic invoicing probably won't affect them.

We will just have to see how it all pans out. This could interesting for the board to keep as a type sticky as information for foreign small business owners in the DR to stay up to date.

 

[Kricke87]

Lol... Yeah right... My wife's grandmother that lives out in El campo like 30 minutes walk to closest road that doesn't have any electricity or even close to any internet connection, even with a phone you don't have signal to connect. She has a colmado for the "locals", I believe we'll be seeing pigs fly before she can install any of those systems.... And also, what stops a barber or any other "micro" empresa from not providing a receipt?? You go in get your haircut and eithert pay 300 pesos "tax-free" or you pay 400 pesos with the tax included, what will you choose???
And I remember like 8 years ago when they tried to implement something like this, that they were obligating all business owners, registered or unregistered to have this system. It was NOT for free, you had to pay for it, if I don't remember incorrectly it was something like 50k-100k pesos for the system. So there was a great outcry about this among business owners, so they only implemented it to the bigger multi-million companies. So yeah, right.....

 

[Sol09]

Lol... Yeah right... My wife's grandmother that lives out in El campo like 30 minutes walk to closest road that doesn't have any electricity or even close to any internet connection, even with a phone you don't have signal to connect. She has a colmado for the "locals", I believe we'll be seeing pigs fly before she can install any of those systems.... And also, what stops a barber or any other "micro" empresa from not providing a receipt?? You go in get your haircut and eithert pay 300 pesos "tax-free" or you pay 400 pesos with the tax included, what will you choose???
And I remember like 8 years ago when they tried to implement something like this, that they were obligating all business owners, registered or unregistered to have this system. It was NOT for free, you had to pay for it, if I don't remember incorrectly it was something like 50k-100k pesos for the system. So there was a great outcry about this among business owners, so they only implemented it to the bigger multi-million companies. So yeah, right.....

The costs just to report and remit sales tax are prohibitive to a small business. You would need the POS software which can handle issuing the individual NCFs (tax identification numbers associated with each transaction), the DGII authorized printers, and pay a bookeeper just keep up with compliance and do the monthly reporting.

 

[NanSanPedro]

The costs just to report and remit sales tax are prohibitive to a small business. You would need the POS software which can handle issuing the individual NCFs (tax identification numbers associated with each transaction), the DGII authorized printers, and pay a bookeeper just keep up with compliance and do the monthly reporting.

Can you explain why you would need a bookkeeper? Wouldn’t the SW automatically do what the bookkeeper would do?

 

[aarhus]

The costs just to report and remit sales tax are prohibitive to a small business. You would need the POS software which can handle issuing the individual NCFs (tax identification numbers associated with each transaction), the DGII authorized printers, and pay a bookeeper just keep up with compliance and do the monthly reporting.

There is a joke out there that NCF stands for “Necesito Contador Fiscal” as it’s impossible to do it without monthly paying a local tax accountant. It is a massive bureaucracy.

 

[Sol09]

Can you explain why you would need a bookkeeper? Wouldn’t the SW automatically do what the bookkeeper would do?

Can you explain why you would need a bookkeeper? Wouldn’t the SW automatically do what the bookkeeper would do?

Bookkeeper for the current reporting structure as it's manual and very tedious. I figure most business owners who can afford the bookkeeper have one just to not have to deal with it!

Hopefully one of the benefits of the proposed new system is the elimination of the reporting since the DGII will already have all the transaction data they can just give you your bill (sales taxes owed).

 

[aarhus]

Bookkeeper for the current reporting structure as it's manual and very tedious. I figure most business owners who can afford the bookkeeper have one just to not have to deal with it!

Hopefully one of the benefits of the proposed new system is the elimination of the reporting since the DGII will already have all the transaction data they can just give you your bill (sales taxes owed).

You reckon the goal is to eliminate the monthly tax accounting expense ? That sounds to good to be true.

As said I hope dr1 could make this a type sticky as that would really be something useful to know about and how it materializes.

A shame hijo de manolo isn’t currently able to comment, if banned, as he knew a lot about this.

 

[Sol09]

You reckon the goal is to eliminate the monthly tax accounting expense ? That sounds to good to be true.

As said I hope dr1 could make this a type sticky as that would really be something useful to know about and how it materializes.

A shame hijo de manolo isn’t currently able to comment, if banned, as he knew a lot about this.

Nope, I never reckoned that was the goal of this initiative.

Simply stating an observation that this could reduce an very large administrative burden which I'm sure most businesses would be happy about.

 

[aarhus]

Nope, I never reckoned that was the goal of this initiative.

Simply stating an observation that this could reduce an very large administrative burden which I'm sure most businesses would be happy about.

More likely it’s to create more work for the tax accountant if anything.

 

[Sol09]

More likely it’s to create more work for the tax accountant if anything.

How so? You clearly didn't know how this was any different from the current setup. What direct experience do you have with this to make such statements?

 

[aarhus]

How so? You clearly didn't know how this was any different from the current setup. What direct experience do you have with this to make such statements?

I wish we could keep this going as a sticky to see how this pans out in the long term. They have announced by 2025 it includes all businesses even the sole proprietor with an RNC persona física I assume or an E.I.R.L. And you wrote yourself above that was an impossible task for them. Apart from that I apologize. Of course I can’t know as I am not an accountant and don’t have a business in the DR anymore.

 

[Buffness]

Currently, the reporting of sales and the associated taxes collected is done via manual, self reporting. It seems this new system will integrate a company's POS with the DGII so that the amounts will be reported automatically for each transaction.

This will reduce the underreporting of taxes collected.

When a company makes a sales to a consumer and collects 100.00 in ITBIS, they self report and remit that amount by the 20th of the following month. My understanding of this new system is that the 100.00 of ITBIS will be reported automatically at the time of sale. This eliminates the chance to exclude some sales for the self reporting way and pocket the taxes collected.

I have not seen one man shops (barbers, salons, colmados, roadside produce stands, etc.) issue invoices with tax credit as it is now so this new electronic invoicing probably won't affect them.

There it is ! For the other question or points raised …DR only has to look at how the system evolved in Chile , Mexico or Brazil ….

 

[aarhus]

Hopefully we can keep this thread going so we can see how it materializes with the plan until 2025. To me it looks like it will involve the tax accountants even more ensuring the monthly compliance to the DGII. If we have this thread open it could help a lot of small foreign business owners stay informed.

 

[aarhus]

The costs just to report and remit sales tax are prohibitive to a small business. You would need the POS software which can handle issuing the individual NCFs (tax identification numbers associated with each transaction), the DGII authorized printers, and pay a bookeeper just keep up with compliance and do the monthly reporting.

But isn’t it the plan that everybody get into the program by 2025 ?

 

[aarhus]

The costs just to report and remit sales tax are prohibitive to a small business. You would need the POS software which can handle issuing the individual NCFs (tax identification numbers associated with each transaction), the DGII authorized printers, and pay a bookeeper just keep up with compliance and do the monthly reporting.

It’s interesting with the DGII authorized printers. Can it only be done using them ?