How Do I Apply VAT to Invoices?
Applying VAT to Invoices in Clarus WMS
This guide explains how to apply Value Added Tax (VAT) to your invoices in Clarus WMS. You can choose whether your prices are tax-inclusive or tax-exclusive, and the system will calculate VAT automatically.
Step-by-Step Guide
1. Understand VAT Options
When setting up VAT for invoices, you have two choices:
- Amounts Are - Tax Inclusive: The unit prices already include VAT.
- Amounts Are - Tax Exclusive: VAT is added separately to the unit prices.
2. Set Up Tax-Inclusive Amounts
If your prices already include VAT:
- Select Amounts Are - Tax Inclusive.
- Choose a VAT rate for each line item:
- No VAT: No VAT will be applied.
- 5% VAT on income: 5% of the unit price is considered VAT.
- 20% VAT on income: 20% of the unit price is considered VAT.
REMEMBER: The system will display the VAT amount below the invoice subtotal.3. Set Up Tax-Exclusive Amounts
If you want to add VAT separately:
- Select Amounts Are - Tax Exclusive.
- Choose a VAT rate for each line item:
- No VAT: No VAT will be applied.
- 5% VAT on income: VAT at 5% will be added to the unit price.
- 20% VAT on income: VAT at 20% will be added to the unit price.
REMEMBER: The system will add the VAT amount to the total and show it below the subtotal.FAQs
Can I apply different VAT rates to different items on the same invoice?
Yes, you can apply different VAT rates (No VAT, 5%, or 20%) to each line item.
What is the difference between tax-inclusive and tax-exclusive amounts?
Tax Inclusive means that the unit price already includes VAT, while Tax Exclusive means that VAT is added on top of the unit price.
How does the system calculate VAT?
The system calculates VAT automatically based on the selected rate for each line item and displays it below the invoice subtotal.
Can I change the VAT rate after selecting it?
Yes, you can change the VAT rate for each line item before finalising the invoice.
What happens if I select No VAT?
If you select No VAT, the line item will be treated as VAT-free, and no VAT will be applied to that item.
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