Introduction
The VAT Cash system was implemented for Mexico and International legislations in release 381. This can be controlled through the Flexible VAT system option in the General ledger settings. Once this setting is enabled, user can assign a return period and later make a final return for the cash based VAT invoices which have been partially or fully paid in the VAT Invoice List or VAT Overview.
To further improve this functionality, some adjustments and enhancements have been made in this release in order to support both the bill of exchange (BOE) and payment in transit (PIT) functionalities. The VAT Cash system is now available to all legislations except Czech Republic.
In addition, there are some existing issues which need to be resolved to ensure the correct generation of Cash-based VAT value.
What has been changed
The following changes are implemented:
Note: When VAT charged is selected, the system will hide the VAT cash system, VAT to be paid account, and VAT to be claimed account.
VAT Invoice ListIn the VAT Invoice List under Finance/VAT/Statistics/Invoice list, the Assign button is enabled again.Note:
The Type field (Flexible VAT system, Invoice system or Cash system) in the Finance/VAT/Statistics/Value added tax will now follow the type as selected in the G/L settings.
Upon the settlement of the letter of credit (LOC), the system shall automatically generate the VAT reversal entry according to the matched paid amount of the invoice.
When the user found that the deposit of the letter of credit is incorrect (for example, enter the wrong amount) or the customer does not have enough funds to clear the LOC, the user will bounce the invoice, and the system will reset to the original invoice stage. Upon Bounce status, the system will revert the VAT reversal entry that was generated earlier.
For more details of the BOE, see Extension of Cash-Based VAT System in BOE.
When the Journalize payments and PIT are selected in the System/General/Settings/Bank settings, upon the term processing in Cash Flow/Payments/Process, the VAT reversal entry (full VAT amount) will be generated.
For more details of the PIT, see Extension of Cash-Based VAT System in PIT.
Matching prepayment with invoices in multiple currenciesWhen matching prepayment (prepayment which is excess payment/receipts resulted from the matching of the receipt/payment) with invoices in multiple currencies, the following scenarios applies:
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