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Topic:   Purchase tax (VAT)

By: GuestPosted on: Oct 22 2019 at 06:31:31 AM
Can VAT be automatically added to purchase order total value?

By: SupportPosted on: Oct 22 2019 at 09:49:09 AM
Sorry No. You need to do that yourself.

Fact is, VAT is the responsibility of the seller, not the buyer. (So MiniMRP will calculate VAT on sales orders but not on Purchase orders)

There's a few different ways to calculate VAT and you MUST pay the amount requested by the supplier even if it does not match your own calculation.

Yoy might ask how could your supplier's calculation differ from your own.

If your purchase order, and the supplier's invoice, has a few items then the supplier is allowed to calculate VAT in any of these ways.

1. Calculate VAT on each row individually which may include fractions of a penny on each row. He can round to the nearest penny on each row and add up the invoice total.
2. Calculate VAT on each row individually and add up all the fractions of a penny and round once at the bottom.
3. Do not calculate VAT on each row. Instead total up the net item costs and add VAT once at the bottom.

All of those methods will often give different results by a penny or so but your supplier can use either of those methods so, in many cases, your purchase order will not match your supplier's invoice.

We simply can not generate purchase orders with VAT that don't match your supplier's invoice because you'd come back at us that we've done the VAT wrong.

As I said. You must pay whatever VAT the supplier shows on his invoice even if it does not match your own calculation. So VAT on a purchase order is pointless.

By: GuestPosted on: Oct 24 2019 at 07:39:35 AM
OK thanks, that makes sense.

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