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VAT liable field - Vendor page

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Good morning,

We are looking at the vendor card set up, and wanted to check the purpose of the "VAT liable" check box. We currently have this unchecked and are using the VAT Business Posting value on the vendor to determine the VAT posting amount on invoices, so am unsure what this field does?

Appreciate your advice!

Many thanks

Sue

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Marco Mels Microsoft Employee on at

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Hello,

Some companies must use reverse charge VAT when trading with other companies. For example this rule applies to purchases from EU countries/regions and sales to EU countries/regions.

This rule applies when trading with companies that are registered as VAT liable in another EU country/region. If you do business directly with consumers in other EU countries/regions, then you should contact your tax authority for applicable VAT rules.

You can verify that a company is registered as VAT liable in another EU country by using the EU VAT Registration Number Validation service. The service is available for free in Business Central.

Thanks.

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Community Member on at

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Hi Marco,

Thanks for coming back to me. We do have reverse charge VAT scenarios but again this seems to be managed via the VAT posting setup so still a little unclear what the "VAT liable" check box is doing?

Kind regards

Sue

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Marco Mels Microsoft Employee on at

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Hello,

Just to let you know I asked one of my colleagues to try to come back to you.

Thanks.

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Community Member on at

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Much appreciated, thanks Marco

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Brian Wick Microsoft Employee on at

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Hi Susan,

It is used for Sales Tax. In Tax Posting Setup (VAT Posting Setup) if you left the top line with BLANK for both VAT Prod Posting & VAT Bus. Posting Groups and then set the VAT Calculation Type = 'Sales Tax' that would trigger sales tax in the company. It is then recommended to not have any additional VAT Posting setup for Normal VAT if sales tax is to be used in that company. Then you would setup Tax Areas, Tax Jurisdictions, Tax Details and then define the Tax Area on the Vendor and tick Tax Liable. I believe these fields are included in most worldwide localizations since they are W1 objects, but many of the North America sales tax functionality would be left out as that would only be included in a US or CAD install. If you only use VAT in your company, then you can ignore the VAT/Tax Liable field. Thanks.

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Community Member on at

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Thanks for the explanation Brian. Sounds like we are ok to ignore this field.

Kind regards

Sue

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