Release 372: New Gross-Gross method for Tax and Discount calculation
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Background
Exact Globe 2003 did not support Gross-Gross method for Tax and
Discount calculation. After some final confirmation from the Dutch Tax authorities on the validity of
this method, it has been built in.
What has been changed
In 372, this new method of Tax and Discount
calculation has been added. It is known as "Tax calculated over gross invoice
amount". This functionality is available for all countries listed below:
-
Netherlands
-
Belgium
-
Luxembourg
-
Czech Republic
-
Malaysia
-
Middle East
-
International
-
Philippines
-
Portugal
-
Vietnam
-
United Kingdom
-
Ireland
-
Morocco
-
Poland
-
Hungary
-
Romania
-
Italy
-
Slovakia
-
Russia
Hence in General ledger settings,
a new option "Tax calculated over gross invoice amount" has been added in the
dropdown list of options for Tax and Discount calculation. This option is only
visible for countries listed above.
Screen 1:
For Belgium and Luxembourg,
this option is not only added in the General ledger settings but also in the
dropdown list of options for Purchase invoice in the Payment condition
maintenance screen. The option defined here is only applicable for purchase
invoices when this payment condition is used. (Note: Please refer to release
note
Batch 360: VAT calculation on purchase invoice over net invoice amount excluding
or including discount in payment condition (Belgium) for more details.)
Screen 2:
To what extent this functionality
is supported:
-
Only applicable in Single tax environment. When "Use tax module"
is enabled in the General ledger settings, option for this method "Tax calculated over gross invoice amount" will not be visible in the
General ledger settings (Screen 1) and also
Payment condition maintenance screen (Screen 2).
-
Only applicable to Discounts and not for Credit surcharge.
-
When a database runs the
Repair tool after the option is set to "Tax calculated over
gross invoice amount", data entered prior to the setting change will be
repaired based on this new setting.
-
For entries created prior to
the setting change, editing old data will cause data to be generated based on
the new setting.
Gross-Gross calculation
method
Calculation
of the VAT and Discount amount can be seen in the diagram below when "Tax
calculated over gross invoice amount" is used. For example:
Enter amount for the invoice = 100 USD
VAT = 19% (can be excluding or including)
Discount = 2% (defined in payment condition)
|
On
time payment |
|
Late
payment |
|
Scenario 1 |
|
|
|
|
VAT
including |
|
|
|
|
VAT basis |
84.03 |
[Invoice amount / 1 + (VAT%/100)] |
84.03 |
|
Discount |
1.68 |
VAT basis *
(Discount%/100) |
0.00 |
No
discount |
Amount after
discount |
82.35 |
VAT basis -
Discount |
84.03 |
|
|
|
|
|
|
VAT amount |
15.97 |
VAT basis *
(VAT%/100) |
15.97 |
|
Invoice
amount |
100.00 |
VAT basis + VAT
amount |
100.00 |
|
Receivables/Payables |
98.32 |
Amount after discount + VAT
amount |
100.00 |
|
Scenario 2 |
|
|
|
|
VAT
excluding |
|
|
|
|
VAT basis |
100.00 |
[Invoice amount / 1 + (VAT%/100)] |
100.00 |
|
Discount |
2.00 |
VAT basis *
(Discount%/100) |
0.00 |
No
discount |
Amount after
discount |
98.00 |
VAT basis -
Discount |
100.00 |
|
|
|
|
|
|
VAT amount |
19.00 |
VAT basis *
(VAT%/100) |
19.00 |
|
Invoice
amount |
119.00 |
VAT basis + VAT
amount |
119.00 |
|
Receivables/Payables |
117.00 |
Amount after discount + VAT
amount |
119.00 |
|
At the entry screen of Sales or
Purchase journals, the VAT amount is displayed as shown in Screen 3.1 and 4.1.
The same applies when multiple sub lines are entered with same or different VAT
codes. When press on the <Conditions> button in the entry screen, the Discount amount is displayed
as shown in Screen 3.2 and 4.2.
Screen 3.1 - Scenario 1:
Screen 3.2 - Scenario 1:
Screen 4.1 - Scenario 2:
Screen 4.2 - Scenario 2:
At the entry screen of General journal,
the VAT amount is displayed as shown in Screen 5 and 6.
The same applies when multiple sub lines are entered with same or different VAT
codes. When press on the <Terms> button in the entry screen, the Discount
amount is displayed as shown in Screen 3.2 and 4.2. This functionality does not applied for Bank
to Cost / Revenue entries via Cash flow, Bank / Cash or General journal.
Screen 5 - Scenario 1:
Screen 6 - Scenario 2:
There is no change in the
existing functionality for Matching, Deduction management or Collective payment.
For example if we enter receipt or payment of 98.32 USD to match with the
invoice in Scenario 1, the "Write off : Discount" screen will be prompted for us
to write off the discount. Likewise if there is an amount difference during
matching, the "Process" screen will be prompted for us to write off the amount
difference.
For Sales orders in Order module, the amount for the
VAT including or VAT excluding displayed in the Sales
orders entry application is similar to the option "Tax calculated over net invoice amount excluding
discount". Therefore, there are no differences when using "Tax calculated over net invoice
amount excluding discount" or "Tax calculated over gross invoice amount".
Gross-Gross method is
applied when come to Invoice module, either sales invoices generated from
Order module or directly entered in Sales invoices entry screen. For sales
invoices, it is also possible to enter phantom items such as extra charges.
These items are also taxable and the Gross-Gross method will be used to
calculate the tax amount, if this method is defined in the administration. For
example:
Sales price = 100.00 EUR
VAT = 19% including
Discount = 2% (defined in payment condition)
Extra charges = 20.00 EUR (VAT = 19% including)
Press on the <Specific> button in the the entry
screen, the Discount / Extra charges is displayed as shown in Screen 7.
Screen 7:
In the above scenario, calculations for the
invoice is as follows:
Net : 84.03 EUR [100 / 1 + (VAT%/100)]
Taxes : 19.16 EUR [(84.03 + 16.81) *
(VAT%/100)]
Specific : 16.81 EUR [20 / 1 + (VAT%/100)]
Total : 120.00 EUR (84.03 + 16.81 + 19.16)
Discount : 2.02 EUR [(84.03 + 16.81) *
(Discount%/100)]
Press on the <Conditions> button in the entry
screen, the Discount amount is displayed as shown in Screen 8.
Screen 8:
In summary the affected areas for Invoice module
are:
Sames goes to Purchase order (PO) or Purchase invoice
entered with PO when Gross-Gross method is defined in the administration. Now
for PO, generation of terms follow the setting. (Note: Please refer to release
note Release
372: Purchase order support for "Tax & Discount calculation"
setting
for more details.) For example:
Purchase price = 100.00
EUR
VAT = 19% including
Discount = 2% (defined in payment
condition)
Hence calculations
for the PO is as follows:
Net : 84.03 EUR [100 / 1 +
(VAT%/100)]
Taxes : 15.97 EUR [84.03 *
(VAT%/100)]
Total : 100.00 EUR (84.03 +
15.97)
Discount : 1.68 EUR
[84.03 * (Discount%/100)]
Press on the <Conditions>
button in the entry screen, the Discount amount is displayed as shown in Screen
9.
Screen 9:
In addition, changes has been
done on Revaluation function as well as XML module in order to support this new
functionality. Gross-Gross method is applied when revalue the invoices or import
the financial entries, if this method is defined in the administration. For
instance, revalue sales invoice in Screen 3.1 from 1.188920 to 1.288920. Amount
in default currency has been updated and is displayed in the debtor's card as
shown in Screen 9.
Screen 10:
Last but not least, this new
functionality has not yet been designed or supported in the following area:
Main Category: |
Support Product Know How |
Document Type: |
Release notes detail |
Category: |
Release Notes |
Security level: |
All - 0 |
Sub category: |
Details |
Document ID: |
14.425.873 |
Assortment: |
Exact Globe
|
Date: |
09-05-2017 |
Release: |
372 |
Attachment: |
|
Disclaimer |