Feature Requests Incident #20135

 


Summary
Project
None
Incident Category
Features
Incident Number
20135
Visibility
public


Product Version
None
Fixed In Version
None


Summary
VAT improvement


Description

VAT support should be identical for most European countries and appeal to many users

Expanded VAT localization - forms for UK, EU, CA, AU


Details
Reporter
pocock
CRM Account
Ready Technology (UK) Limited
Status
Confirmed
Assigned
None


Priority
None
Severity
None
Updated
05-18-14 05:23
Resolution
None



Comments

DateUsernameComment
05/18/14 05:23pocock

I had a closer look at the VAT status and opened some specific issues for some of the things that appear to be most pressing. I can't find any way to link bug reports in this issue tracker so I am just posting the links here:

http://www.xtuple.org/xtincident/view/features/21575 support for EU cross-border VAT free transactions

http://www.xtuple.org/xtincident/view/features/21579 specify tax codes in chart of accounts

These two can probably be merged, 23668 is the more detailed description of the problem:
http://www.xtuple.org/xtincident/view/features/21594 misc voucher should automatically split VAT
https://www.xtuple.org/xtincident/view/bugs/23668 VAT problems with misc invoice payable

http://www.xtuple.org/xtincident/view/bugs/23692 no VAT support in cash receipt form

http://www.xtuple.org/xtincident/view/bugs/23694 can't specify VAT on misc cheque

http://www.xtuple.org/xtincident/view/bugs/23696 can't override tax amount manually

There is a common theme behind several of these issues: businesses in the UK, Australia, etc have to account for VAT on every purchase as well as every sale. For some types of service business there are many of these relatively small expenses like the phone bills, internet charges, office supplies, domain name renewals, SSL certificates, professional fees, contractors performing odd jobs and there is a VAT charge on every one of those vouchers. The EnhancedTaxInternationalization appears to have done most of the groundwork for this but unless people can benefit from that when entering all these little expenses through the misc voucher form (and preferably the misc cheque form too) then they may not appreciate the fact that xTuple supports VAT.

09/28/13 06:30pocock

I suspect that other users will be willing to chip in with tweaks for these reports to help perfect them. This could potentially be done by sharing localization data through github

To maximize the potential for community involvement, xTuple probably needs to define some standard way to create, distribute and import the localization profiles.

E.g. should the localization rules be defined in an XML document for each region? Or in a tar.gz file like the schema update packs?

Does PostBooks need some kind of import utility (maybe built in to the desktop client) that can load the localization pack as a whole? Or should it be more generalized, e.g. an import mechanism that allows objects such as tax codes, tax zones, invoice layouts to be imported and exported in bulk and then a wrapper around this mechanism could bundle the settings for a localization?

CSVImp appears to be good for row-based data (like the currency code list) but may not be generic enough for all object types (e.g. bulk import of a package that includes a table of EU country codes, some JavaScript for EU VAT rules and complex content like invoice layout data all in one XML)

Furthermore, a first-class import tool would probably need to run each object import through the same process as the GUI forms. E.g. if somebody imports an invoice from an import file, the import tool would act as if they inserted the values into the invoice form and automatically do things like assigning tax codes and generating the sequence number and anything else that wasn't manually overridden or specified in the import file.

One further thing that would need to be anticipated is the lifecycle management for localization: could localization changes (e.g. to cope with tax rate changes) be conveniently updated for users on multiple PostBooks versions? Using a suitably generic data format and import tool from the outset would avoid tedious effort backporting changes to users who are not upgrading every time a new version is released. E.g. the tool would import the current list of tax codes, but it would be clever enough not to import duplicates if the user had already manually added a new tax code.

One problem that is probably too hard to solve is supporting users who significantly customize. E.g. if somebody takes the localized invoice for their region and makes basic changes (adding their logo), it would be nice to be able to upgrade the layout cleanly when necessary. However, if they make more dramatic modifications, they should become responsible for updating it if and when rule changes occur.

09/28/13 06:08pocock

To help define the objectives of this feature, there are basically two things that come to mind for most VAT users:

a) correctly printing invoices that charge VAT to customers - PostBooks appears to be capable of this since the enhanced tax code support was added, but each user has to customise their setup to benefit from it. Enhancing this would basically mean providing some way to import the correct tax codes and invoice layout rules for a particular country/region. This FAQ concisely summarizes the exact EU invoice requirements, which covers the UK, Ireland, Germany, France, Italy, Spain and many others:
http://ec.europa.eu/taxation_customs/taxation/vat/traders/invoicing_rule...

Just some observations on some of the points in that list:

(11) break-down of the VAT amount payable per VAT rate or exemption - this is usually displayed in a summary box on the invoice.
- Technically, it is not sufficient to just display a box that has "VAT: 20 GBP", it must say something like "VAT (20%): 20GBP". Some products qualify for lower VAT rates, and so the summary box must include a subtotal for each VAT rate, e.g. "VAT (20%): 20GBP" and another row "VAT (7%): 37GBP" - you can't just combine those into "VAT: 57 GBP". To ensure that users stay legal, the default invoice layout for any EU localization would need to have this more verbose tax summary enabled by default.

(12) unit price of the goods or services exclusive of tax, discounts or rebates (unless included in the unit price) - PostBooks appears to work this way by default, displaying ex-tax unit prices on each line.

b) the other major outcome of this feature, for most businesses, is to quickly prepare their VAT return document. Small businesses do this quarterly or monthly. Competing products provide the VAT return as a standard report, conveniently labelled with the box numbers. Here is an example of the UK VAT return:
http://www.hmrc.gov.uk/vat/vat100.pdf

04/21/13 14:32dcsint

This was suggested on 3/22/2013 and commented on under the kickstart project.

pocock:
VAT support should be identical for most European countries and appeal to many users
ned commented:
Re: VAT, what exactly are you looking for that's not there currently? We are working on some dedicated documentation around this functionality, but it is certainly in use around the world today. Here is a link to the original spec for the work that was implemented: http://www.xtuple.org/EnhancedTaxInternationalization
pocock replied:
I can see that there is a lot of flexibility in the system, but what smaller users expect is something that `just works' very quickly.
In practice, this would probably mean that there would be some setup wizard where they choose their country, and it pre-configures all the VAT rates and necessary reports
For the UK authorities (HMRC), there is a standard VAT reporting form with 9 boxes. All the basic accounting software packages have the ability to print a report matching those boxes, Australia's GST is extremely similar.
I've just installed PostBooks yesterday, I found the reports for balance sheet, P&L and cashflow, but it's not clear to me if the `Tax History' function is going to give me the instant VAT report.
fblauer commented:
I just use the GL to fill out the VAT forms (for Canada). It takes me about 10 minutes. I use the tax history for backup only.

04/21/13 14:28dcsint

VAT support should be identical for most European countries and appeal to many users

Expanded VAT localization - forms for UK, EU, CA, AU



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Incident History

DateUsernameFieldChange
04/22/13 15:38schurchCharacteristic Kickstart Added: "True"
04/23/13 09:24ptylerStatusStatus Changed: New -> Confirmed
04/21/13 14:28dcsintNewIncident Added
06/28/13 16:09nedDescription Updated: "VAT support should b..." -> "VAT support should b..."
07/01/13 15:16jrogelstadCharacteristic Time Estimate Added: "???"
09/30/13 09:48bcwilsonContact Changed: "Daniel Pocock" -> "Daniel Pocock"