VAT in Sales
VAT is included in both the sales and purchase transactions of your business. There are different methods in which VAT is calculated on sales, according to the region and the VAT treatment of your customers. In Zoho Books, the VAT treatment of your contact is taken into account and the VAT associated with the item is automatically populated.
IN THIS PAGE…
Sales Within the UK
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 Goods that are being sold or a Service that is being rendered. If a service is billed in the same invoice where goods are being sold outside the UK, then the service will be associated to the goods and will be labelled Service Associated to Goods.
If sales are made to countries outside the UK, it will be recorded under Your total sales excluding VAT in the VAT return report.
For customers 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 [NI Protocol]
If you’re a business in Northern Ireland and you are selling goods to a customer who is in the EU and is registered for VAT, then the VAT can be Zero-Rated or a Zero Rate (0%) VAT can be charged on your export. To do this, you’ll have to enable the NI protocol from VAT settings and select the VAT treatment as EU-VAT registered [NI Protocol] for the customer.
To enable the NI Protocol in your organisation:
- Go to Settings > VAT > VAT Settings.
- Mark the Enable trading of goods between Northern Ireland and the European Union (NI Protocol) checkbox.
- Click Save.