VAT in Sales
VAT is included in both the sales and purchases for your business. There are different methods in which VAT is calculated on sales, according to the region and VAT treatment of your customers and vendors. In Zoho Books, VAT treatment of your contact is taken into account and the VAT associated with the item is automatically populated. Making it simple for your accounting purposes.
For creating a sales (Invoices, Estimates, Sales Orders, Credit Notes) transaction that is within the United Kingdom,
- Select the customer whose VAT treatment is for United Kingdom.
- Add the item for which you are creating the sales transaction and select the VAT amount.
VAT treatment of your customer can be changed only for that estimate, invoice or the order you create. Click on the notification, select the VAT treatment you prefer and click on Update.
You can also set the VAT treatment as a permanent change by checking on the Make it permanent? box.
Sales Outside UK
For sales (Invoices, Estimates, Sales Orders, Credit Notes) that are made outside the UK, you will be able to find the labels that will denote if its a Goods that is being sold or a Service that is being rendered. If a service is billed in the same invoice where an item is being sold outside the UK, then the service will be associated to the item and will be labeled Service Associated to Goods.
- If the sale is made to an EU country, the sale will get recorded under Total Value of goods you supplied to other EU countries in the VAT return report.
- If the sales is made to countries outside EU, it will get recorded under Your total sales excluding VAT in the VAT return report.
For Contacts having currencies other than GBP, an Exchange Rate field is provided for you to enter the rate and the value will be calculated.
Sales to EU-VAT Registered Customers
If you are selling a product or a service to your customer who is a part of the EU and VAT Registered, then the VAT can be Zero-Rated or a Zero Rate (0%) VAT is charged on your export.