Defining VAT Tax

Countries other than the U.S. charge a VAT (Value Added Tax) tax rather than the U.S. sales tax. VAT tax is a European sales and purchase tax that is collected and paid by the organizations with a turnover greater than £30,000 (in the United Kingdom). Personify360 maintains the VAT tax categories and percentages over time. Since tax liabilities are owned by the financial company, they must be defined by company to associate a company liability account.

To define VAT tax:

1. From the Personify360 main toolbar, select Accounting > Accounting Setup > VAT Tax Definition.
The VAT Tax Maintenance search screen displays.

2. Click Create New.
The VAT Tax Maintenance screen displays, as shown below.

3. Select the Company from the drop-down.

4. Select the Country from the drop-down.

5. Select the VAT Category from the drop-down.

6. Click Add VAT Tax.
The VAT Tax Detail fields are enabled.

7. Enter the VAT Percent.

8. Click the Liability Account link to search for a liability account associated with the VAT.

9. Select the Begin Date and End Date from the drop-downs.

10. Click Save.

Screen Element	Description
VAT Tax Master
Company	Drop-down. This is the company associated with the VAT tax. Since the system works across companies, you must define the VAT tax at the company level to indicate that the taxes are valid for the company and location.
Country	Drop-down. This is the country associated with the VAT tax.
VAT Category	Drop-down. This is the category of the VAT tax. For example, 10%, 17.5%, or 5%.
Add VAT Tax	Button. When clicked, a row is added to the table and the corresponding fields are enabled to add VAT tax details.
Delete VAT Tax	Button. When clicked, the highlighted row from the table is deleted.
VAT Tax Detail
VAT Percent	Text box. This is the percentage of VAT tax that will be levied, carried to four decimal places. Countries charge a percentage of their sales as VAT tax in the processing of their transactions.
Liability Account	Link. The liability account used to store the VAT tax amount.
Account Description	Read-only. The description of the liability account.
Begin Date	Drop-down. The date the VAT tax will be applied to orders.
End Date	Drop-down. The date the VAT tax will no longer be applied to orders.