How EC Company, Company pays tax and the Tax Ref affect the VAT Return
How EC Company, Company pays tax and the Tax Ref affect the VAT Return
Overview
When setting up EC companies it is useful to understand what happens when the following fields on the Customer General screen are used:
Tax Ref
EC Company
Company pays tax
For all the following both the Tax and EU checkboxes in System Data Countries are ticked.
EC Company
Company pays tax
Tax Ref
Result
Toggle Green
Toggle Green
Added
Appears on the Tax Register EC with NO VAT
Toggle Green
Toggle Green
Not added
Appears on the Primary Tax Register with VAT
Toggle Red
Toggle Red
Added
Appears on the Primary Tax Register with NO VAT
Toggle Green
Toggle Red
Added
Appears on the Tax Register EC with NO VAT
Toggle Green
Toggle Red
Not added
Appears on the Primary Tax Register with NO VAT
When creating Sales and Purchase Orders, Khaos Control Cloud uses the country table to determine whether or not it should apply tax to the sales order. The Company Pays Tax checkbox will override the result of that check and stop tax being charged. Under current VAT legislation, it is difficult to envisage circumstances in which you would NOT toggle off the Company pays tax option.
It is not possible to change a Tax Reference against an invoice once it has been stamped.
Only orders raised after a Tax Reference is provided will have the tax reference attributed to them.
The following video shows how this affects sales orders and the Tax Register: