News and Announcements icon

Dynamics 365 CommunityForums Finance forum Difference between &qu...

Finance forum

Suggested answer

Difference between "Use Tax" and "Reverse Charge"

(0) Share

Report

Report

Posted on by Community Member Microsoft Employee

Hi,

I wonder what the difference is between using the check box for "Use Tax" and "Reverse charge" for the sales tax code when I set up sales tax groups?

I have always set the "use tax" check box to yes if I want the Sales tax transaction to reverse when I post a transaction where I will need the sales tax for reporting purposes but I will not pay it (For example when you buy a product from an EU country to Sweden). I have read about it but it seems like the result becomes the same, no matter which of the two check boxes I choose to fill out. So what is the difference?

2248.sales-tax-group.png

Categories:

Administration and Setup

All responses Img

All responses (2)

Answers Img

Answers (0)

Suggested answer

Ramit Paul 20,714 Super User 2024 Season 2 on at

Like (0)

Report

RE: Difference between "Use Tax" and "Reverse Charge"

Hi Emma,

Did the suggestion help you to understand the concept?

If so, you may mark this answer as verified to motivate us.

If not, kindly share what is your requirement on this?
Suggested answer

Ramit Paul 20,714 Super User 2024 Season 2 on at

Like (1)

Report

RE: Difference between "Use Tax" and "Reverse Charge"

Hi,

From the accounting point of view, there is no difference

however from the sales tax reporting there is difference.

use tax offset the same tax by sales tax receivable and sales tax payable

However reverse charge require two tax code

Check this doc from MS.

docs.microsoft.com/.../emea-reverse-charge

Helpful resources

Quick Links

Leaderboard

#1

André Arnaud de Cal... 290,246 Super User 2024 Season 2

#2

Martin Dráb 228,041 Super User 2024 Season 2

#3

nmaenpaa 101,148

Leaderboard

Featured topics

Product updates

Dynamics 365 release plans