Under certain conditions, sales or purchase VAT is calculated and paid by the customer or vendor, if the customer or vendor is registered in Lithuania as a VAT payer. These conditions include:

  • The company is buying or selling wood and woodenwares, such as logs, planks, or beams.

  • The company is buying or selling ferrous/non-ferrous items or products, including waste or debris.

  • The company is bankrupt.

When the sales and purchase orders are marked as Not in invoicein the Sales tax codes setupform, the VAT paid by the customer is excluded from the tax calculated in the invoice register reports. The sales invoice register (FR0672) and the purchase invoice register (FR0671) reports are modified to display the amount of VAT paid by the customer (reverse charge VAT case) and the VAT that pertains to purchase and sales orders issued by United VAT companies.

  1. Click General ledger> Setup> Sales tax> Sales tax codesto open the Sales tax codesform.

  2. Press CTRL+N to create a new line.

  3. In the Sales tax codefield, enter a VAT code.

  4. In the Percentage/Amountfield, enter a negative VAT percentage.

    Note Note

    Enter a new sales tax code with a normal VAT percentage.

  5. Click the Generaltab.

  6. Select the Not in invoicecheck box to exclude the sales tax code with a negative percentage from the VAT specification in the invoice reports and the invoice registers.

    Note Note

    Select the Not in invoicecheck box only for the sales tax code with a negative VAT percentage.

  7. Click the Tax directivesbutton to enter the language and description for the new sales tax codes.

  8. Press CTRL+S or close the form.

  9. Click General ledger> Setup> Sales tax> Sales tax groupsto open the Sales tax groupsform.

    Note Note

    For more information, see "Sales tax groups (form)" in the Applications and Business Processes Help.

  10. Press CTRL+N to create a new line.

  11. In the Sales tax groupsfield, enter a sales tax group.

  12. Click the Setuptab.

  13. In the Sales tax codefield, select the sales tax code with a negative VAT percentage to attach the sales tax codes to the sales tax groups.

    Note Note

    You must also attach the sales tax code that you created with a normal VAT percentage.

  14. Press CTRL+S or close the form.

  15. Click General ledger> Setup> Sales tax> Item sales tax groupsto open the Item sales tax groupsform.

    Note Note

    For more information, see "Item sales tax groups (form)" in the Applications and Business Processes Help.

  16. Press CTRL+N to create a new line.

  17. In the Item sales tax groupsfield, enter an item sales tax group.

  18. Click the Setuptab.

  19. In the Sales tax codefield, select the sales tax code with a negative VAT percentage to attach the sales tax codes to the item sales tax group.

    Note Note

    You must also attach the sales tax code that you created with a normal VAT percentage.

  20. Press CTRL+S or close the form.

See Also