Books of accounts

Section 232 of the Tax Code puts the duty on "all corporations, companies, partnerships or persons required by law to pay internal revenue taxes." The word doing the work is persons. The section never limits itself to sole proprietors or businesses with storefronts; a freelancer in practice of profession is covered by the same sentence as a corporation.

The reason employees skip this and you cannot: an employee's income is documented by the employer's payroll reporting. You have no employer, so nobody documents your income unless you do. The books are that substitute, the legally recognized record of what you earned and spent.

Philippine income tax is self-assessed. You compute your own 1701Q and the BIR takes your word for it, until it checks. The books are what it checks against, and books, invoices and returns must tell one story. A return with no books behind it is an unsupported claim.

The EOPT law kept the duty but sized it to you: books and records are retained for five years, and micro and small taxpayers, meaning gross receipts under 3 million and under 20 million pesos, are entitled to simplified bookkeeping. For a service freelancer that is two manual notebooks.