Introduction
Introduction
The detailed step by step procedures for the Flexible VAT system on BOE is described in this document.
Procedure
1. Create a new VAT code C19 under System/General/Countries/Tax codes
2. Create a sales journal via Finance/Entries/Sales with the payment method 'Letter of credit' and VAT code C19 created in step 1.
The VAT amount will be booked into a VAT to be paid type Neutral as defined in the VAT code maintenance.
| GL |
VAT code |
Amount |
VAT Basis |
VAT amount |
| 1300 (Debtor) |
|
1190 Dr |
|
|
| 8000 (Revenue) |
C19 |
1000 Cr |
1000 Cr |
190 Cr |
| 1425 (VAT to be paid) |
C19 |
190 Cr |
1000 Cr |
190 Cr |
3. In the Cash Flow/Miscellaneous/Instrument status, select 'Cash in' and option 'Invoices'
Select the invoice and press on the Receive button. The following financial entries (receipt) will be generated and matched to the invoice:
| GL |
Amount |
| 1110 (Bank) |
1190 Dr |
| 1300 (Debtor) |
1190 Cr |
4. Under option 'Received', select the invoice and press the Deposit button. Deposit into the Cash instrument 01112222222EUR.
| GL |
Amount |
| 1110 (Bank) |
1190 Cr |
| 1600 (Creditor) |
1190 Dr |
| 1134 (Bank) |
1190 Dr |
| 1600 (Creditor) |
1190 Cr |
5. Click option 'To be collected', select the invoice and press Settle. Upon settlement, the VAT reversal entry will be created.
| GL |
Amount |
| 1425 (VAT to be paid) |
190 Dr |
| 1517 (VAT to pay) |
190 Cr |
6. Once a settlement has been made, user can Unsettle or Bounce the letter of credit. By clicking on the Unsettle or Bounce button, the VAT reversal entry will be voided.
Related document
Release 390: Extension of Cash Based VAT System in BOE and PIT