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VAT codes are maintained via Maintenance > Financial > VAT.

VAT codes can be assigned to general ledger accounts, debtors, creditors and articles.

 

General ledger account

When a journal entry containing a VAT code with a percentage is stored, automatic journal entries are created as well (901 entries).

The amounts in these automatic journals will be booked at the general ledger account of the VAT code.

 

Percentage

The VAT percentage is used to calculate the VAT amounts.

The VAT amount for an invoice line will be calculated based on the percentage of the VAT code set at the article..

However when a zero percentage VAT code is assigned to the debtor, VAT will be excluded for all invoice lines.

 

On purchases, on sales

A distinction is made between VAT code to be demanded (on purchases) or to be transferred (on sales) with the Type field.

 

Text

This text can be used on the invoice.

To display this text on an invoice the invoice layout needs to accommodate this item.

Adjustment of an invoice layout may be necessary to support it.

 

Conditions for the Dutch VAT Declaration

–To use the VAT declaration in Mill7 each VAT code must be linked to a different general ledger account.

–When a VAT amount is booked directly on a general ledger account, this account must be assigned to a VAT code.

–VAT codes of the types VAT shifted or Goods/Services inside or outside EU can only be used in creditors daybooks.

–The bookkeeping currency or the VAT currency set at Maintenance > Settings > Book > Other must be Euro.

 

Type of VAT

The following types of VAT are available.

–VAT default

–No VAT

–VAT shifted

–Delivery/Service inside EU

–Delivery/Service outside EU

–Other VAT

–Private use

 

With VAT type "VAT default" turnover and VAT amounts are presented on the declaration in section 1.

The other VAT types will be used for the other sections or to prevent the turnover from appearing on the VAT declaration form.

 

VAT default

With VAT type "VAT default" turnover and VAT amounts are presented on the declaration in section 1.

Depending on the VAT percentage amounts will be added to section 1a (21%), 1b (9%) or 1e (0%).
Turnover with 0% VAT can only be applied to section 1e when sales haven been booked in a debtors daybook.

 

No VAT

This type of VAT can be used when the VAT percentage is 0 and the turnover must be excluded from the VAT declaration.

 

VAT shifted

VAT can be shifted to a debtor or a creditor can shift VAT to you.

When VAT is shifted to a debtor this should be indicated on the invoice.

No journals concerning VAT have to be created.

The percentage of this type of VAT is always 0.

 

Creditors

The creditor should indicate on the invoice that VAT is shifted to you.

To indicate that the creditor shifts the VAT to you a VAT code of the type VAT shifted should be assigned to the creditor.

When booking the invoice, the VAT amount should be calculated and booked as two separate journals.

Mill7 will generate these journals automatically, but these journals can also be added manually.

The VAT amount must be booked debit and credit and the total of both must be zero.

The journals are booked directly on the general ledger account linked to the VAT shifted VAT code.
Turnover and VAT are presented on the VAT declaration in section 2a.

 

Debtors

VAT can be shifted to a debtor by assigning a VAT code of the type VAT shifted to the debtor.

On the invoice a remark stating that the VAT is shifted will appear if the invoice layout used supports this.

Turnover is presented on the declaration in section 1e.

 

Delivery/service inside EU and outside the EU (Intra Community Supplies)

Sales can be made inside or outside the EU. To distinguish between delivery and Service the setting Delivery/Service can be used to choose between Service or Delivery.

With Delivery/Service the VAT percentage is always zero, with an acquisition there may be a VAT percentage.

 

ICP amounts will be presented in section 3 or 4 of the VAT declaration.

If amounts are present in section 3b, a separate ICP declaration has to be filed which can be calculated and sent from Mill7.

 

Creditors

The VAT amount of a purchase must be entered while booking the invoice.

The amount must be booked on the general ledger account linked to a VAT code with Type of VAT is Delivery/Service inside EU or Delivery/Service outside EU.

The BTW amount will be booked debet and credit.

Mill7 will generate these journals automatically, but these journals can also be entered manually.

 

Debtors

To create correct bookings while invoicing debtors a VAT code with Type of VAT is Delivery/Service inside EU or Delivery/Service outside EU must be assigned to the debtor.

On the invoice the VAT ID Number of the debtor should mentioned. The VAT ID Number can be filled in at the debtors screen General.

The journals of these invoices will automatically appear in the ICP declaration.

 

Other

This type of VAT can be used for percentages that are not common and will appear in section 1c on the VAT declaration form.

 

Type of Delivery

Is used to distinguish delivery and service when using the ICP declaration. This only applies when Type of Vat is Delivery/Service inside EU.