VAT - VAT Rates

Introduction
VAT Rates

Introduction

This guide explains the VAT rates for Customers, Suppliers and Stock & Order Items.

BCE allows VAT rates to be stored on customer and supplier accounts and stock items.

BCE operates a line based VAT system that permits documents to contain multiple transaction lines that use different VAT rates.

As a general rule, BCE will respect the VAT rate from the customer or supplier account but this can be overridden at transaction line level depending on the VAT rate stored on stock items.

For example, where a standard rate supplier supplies stock items that are zero rated, it is correct that the stock VAT rate overrides the VAT rate set on the supplier account.

Customers' and suppliers' VAT rate is normally fixed as they will be either registered or not registered for VAT, therefore it is not recommended to change the VAT rate on a document header as it is unlikely the customers' or suppliers' VAT status will change.

BCE regards 'Exempt' as outside scope and excludes the transaction lines from the VAT report

VAT Rates

Business Cloud Essentials allows many VAT rates to be defined for Customers, Suppliers and Stock & Order Items.

The system default VAT rates cannot be amended.

Customer VAT types

For Customers these are available VAT Types:

UK Standard (20%)
UK Zero Rate (0%)
UK Exempt (0%)
EU Export (0%)
Non EU Export (0%)

Supplier VAT types

For Suppliers these are available VAT Types:

UK Standard (20%)
UK Zero Rate (0%)
UK Exempt (0%)
EU Import (0%)
Non EU Import (0%)

Above mentioned codes are system defaults and cannot be amended or added by users.

Stock & Order Items VAT types

Stock & Order Items populate their VAT Rate list from Accounts > VAT Rates. By default the system ships with the following:

UK Standard (20%)
UK Zero Rate (0%)
UK Reduced Rate (5%)
UK Exempt Rate (0%)

This list can be expanded by the user.