Warning: VAT/Sales tax with net amount not in basic currency

Cause

Transactions in multi-currency accounting with net tax VAT code, are only possible in the basic currency. If a net VAT tax code is applied to an amount in foreign currency, the program does not support this function, as the calculation of the gross value would in many cases be incorrect due to the rounding of VAT and of the exchange rate.

For an explanation see VAT and foreign currency transactions.

Solutions

If there is an amount in a foreign currency, we suggest the following options to avoid any problems:

  • Enter a amount, enter in VAT code for net amount in the respective column and press F6, whilst positioned in that same cell.  This will automatically add the VAT amount to the net amount entered.
  • Alternatively,  enter the transaction in the basic accounting currency on an internal transfer account denominated in the basic currency, without using any VAT codes. Insert the VAT code in the subsequent transaction, the internal transfer account and the amount calculated in the basic currency in the first transaction.
Tell us how we can help you better
If the information on this page is not what you're looking for, is not clear enough, or is not up-to-date, let us know.

Share this article: Twitter | Facebook | LinkedIn | Email