AP VOUCHER WITH ONLY VAT AMOUNT - Special Topic - AP 13

Question:

I need to enter an A/P voucher for VAT only. We had a vendor who did not present a VAT certificate, so we paid them only the cost amount (with zero VAT) on an earlier voucher. Now that we have received a copy of the vendor's VAT certificate, we need to remit only the remaining VAT amount to the vendor. However, we still need to track this as recoverable VAT. What is the best way to do this?

Answer:

The recommended way to enter a VAT-only voucher in these circumstances is as follows:

1. Enter a voucher with the invoice total of just the VAT amount. Put two lines on the voucher, both coded to the account/org/project that was previously charged.
   
   One line should have a negative cost amount and the 0 % VAT code used on the original voucher, so that it exactly offsets what was on the earlier voucher. (If the original voucher was treated as Taxable = "N," the negative line on this voucher should be handled that way, too.)

2. Enter the second line on the voucher with the positive cost amount and the correct VAT code with the proper tax percentage.

Note: Since each of the two lines on the voucher will be different from the voucher total, you will receive warning messages asking whether you want to recalculate the cost or the percentage on the voucher line. Choose the option to recalculate the percentage.

Performing these steps will create a voucher with a net zero cost, the correct VAT amount, and the correct recovery amount. It will also enter into the system a reversal of the amount that was originally processed with a "zero" VAT code, and enter that cost amount with the correct VAT code.

By following the above procedure, you will ensure that you have a good audit trail, proper VAT coding, and the correct calculation and posting of both the VAT and recovery amounts.