Accounts Payable - Calculating VAT Payments

Overview

This functionality is used for VAT payment calculations for clients in the UK, Ireland, Germany, and the Netherlands. Company addresses are maintained in the Maintain Companies screen. For more information, please refer to Maintain Companies.

Process

Pgm: APCTRLFM – AP Control File; standard Treeview path: Accounts Payable > Setup > Control File Options – Voucher tab

Check the 'Reverse Tax Charge Flag' checkbox in the Voucher tab of the AP Control File screen in the Accounts Payable module.

Pgm: ARTAXFM – Tax Table Maintenance; standard Treeview path: System > Global Tables > Tax Code

Check the 'Tax Reverse Charges' checkbox for the tax code on the Tax Table Maintenance screen in the System Data module. The Tax Authorities, Tax Description, and Tax English Translation fields must be completed as required.

Ensure an account is selected in the Tax Credit Account field. When a reverse tax charge is applied, the tax amount will be debited and credited to the same Tax Credit Account.

Pgm: VOUCHENT – Enter Voucher; standard Treeview path: Accounts Payable > Voucher > Enter Voucher – Voucher Detail tab

In the Voucher Details tab of the Enter Voucher screen in the Accounts Payable module, enter a value in the Tax1 field (e.g. 495.00).

Pgm: DISTFRM – Enter Voucher; standard Treeview path: Accounts Payable > Voucher > Enter Voucher – Voucher Detail tab – [Distribution] button

Click on the [Distribution] button on the Enter Voucher screen.

The system will automatically create reverse tax and nullify the tax amount. The resulting posting report is provided below.