Taxation Management

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Taxation Management in Automotive Industry

You may use the system to conduct automatic calculations of VAT amounts for sales, purchases and imports. Users can run all of the vital VAT related reports, wherein individual tax areas can be set up for individual customers and vendors. The performed calculations will possibly assist in the calculation of use tax and tax on tax.

There are four different methods of VAT calculations that are followed by the system:

Normal VAT calculations

Through this method, VAT can be calculated for all items sold or purchased. The seller is given the ability to calculate and withhold the VAT for the item.

Reverse Charge VAT

This option is meant to be used for instances where you need to trade with other countries or regions located within the European Union or EU. In such a situation, the purchaser needs to calculate and settle all VAT accounts with the right tax authorities.

Full VAT

This method is best used when the amount to post consist the whole of the VAT. This option is particularly useful in cases when you need to record import VAT, or make an entry for the correction of a VAT calculation error.

Sales tax

This function is particularly meant to be used for items that have been purchased and sold. You may only use it in case United States (U.S.) sales tax is being recorded rather than VAT.

The system provides users with the ability to process unrealized VAT as well. You will only need to mention the basis on which VAT is to be calculated – VAT that is to be paid to the tax authorities. You may even mention different VAT reporting requirements. This includes sending out reports to varying government authorities, or to different government as well.

A VAT rate change can be performed. The new VAT rate is applied from a particular date onwards. What this means is that from that date onwards, the new VAT rate mentioned is going to be used in all journals and documents.