The tax inquiry will give you no. 2. The net amount is calculated backwards.

It is very important that the net amounts are entered correctly in respect to the tax. This is quite known by accountants.

This is why I recommend that you create Quick Entries for your most frequently entries. This will avoid these erroneous entries.

/Joe

If the net amount is calculated backwards, then how does FA calculate the amount for 0% VAT (Exempt) ?
This is probably the reason I cannot get an amount for this TAX rate. How can we go around this issue?

Thanks
Carmelo

Thanks anyway
/Elax

Joe

The problem with calculated the amount backward, is,  how can I enter 0-VAT transaction (via a payment).
I know I can create an Item with the approriate Tax type, but I still mean with direct payment.
In the UK some item are either 0-VAT or not subject to VAT, but they need to be included in the VAT return.
If I could enter the net amount, instead of the tax amount, in the payment, that would work even for a 0 rate tax, and then be used in the report.

What can I do then ?

It is very important that the net amounts are entered correctly in respect to the tax. This is quite known by accountants.

This is why I recommend that you create Quick Entries for your most frequently entries. This will avoid these erroneous entries.

/Joe

That's what I do, my question how FA knows which rate/amount to use in the Tax inquiry.

For example, let say I buy something for $100 with 20% of VAT.
I enter the following payment
100 -> Stationary
20 -> Tax

total $120.
Everything is fine, the Tax inquiry will tell me net $100, tax $20.

Let's imagine know that I made a mistake and I entered 120 instead of 100
so
120 -> Stationary
20 -> Tax (20%)

What will the tax inquiry tell me ?
1 - Net 120, tax 20 
2 - Net 100 , tax 20
3 Net 120, tax 24 ?

why ?

An easier way would be to create some quick entries for your most frequent payments/deposits.

Joe

When I do a "bank payment", how does FA guess which VAT rate is applied.
I'm not speaking of buying/selling Items which indeeds have a Tax configuration but just normal payment, where I split manually the payment in like "Office stationary" account and a "VAT account".

My problem is when I do a VAT inquiry, the VAT told by the report never match the corresponding VAT GL account.

Taxes in FA are calculated depending on item tax group selected for given item. So in your case you have to define two item tax groups: VAT 20% and VAT 0% (exempt), and select them for bar and water  definitions respectively in Items catalogue. Then on every purchase/sales the right VAT records will be inserted in VAT register.
Janusz

HI Janusz

I'm speaking about normal payment which are not associated to any item.

/elax

water 0.50
bar  0.50
vat   0.1

What will the TAX report do , assume that I have paid 10% of VAT on £1 meaning I should enter 2 different payments ?

Many thanks
/elnax