How do I post reverse charge VAT transactions?
To post a sales invoice in IRIS Financials from suppliers that do not charge VAT, the VAT must be entered. For example, if they are based outside the UK.
If you are unsure whether the transactions being posted must have VAT entered, contact your organisation's accountant.
Reverse charge VAT rates must be set up on IRIS Financials before posting reverse charge transactions.
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Enter the details of the sales invoice:
- in IRIS Financials post a Non Order Purchase Invoices document, and in VAT Rate select RCP
- in IRIS Financials Purchasing create an invoice, and in VAT Code select RCP
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Post a Journal using the PSF Journal input form, then enter the following details:
The nominals used to post reverse charge VAT should already be mapped to VAT Return. If a reverse charge posted document does not display on the VAT Return or in an incorrect box, check the nominals have been linked correctly.
- Debit the 9527 - Reverse Charge Input VAT nominal.
- Credit the 9526 - Reverse Charge Output VAT nominal.
- Only for the 9526 - Reverse Charge Output VAT line, enter the net amount in User Value.
- For both lines, enter the following:
- In Userfield 2, the invoice number
- In Userfield 3, the supplier's VAT number