[GNC] How to process a purchase made without paying VAT and add it as an investment to be later depreciated

[Jeremy D]

Forgot to attach the file. :-)

2018-07-13 23:02 GMT+02:00 Jeremy D <jeremy.defrere at gmail.com>:

> Hi Geert, Frank,
>
> First of all, I really appreciate the feedback.
>
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> *assets:         VAT reimbursable                 Buys @ full rate: 21%
>               : liabilities:         VAT                 Sales: 21%
>         Import with VAT ID: 21%*
>
> This resembles more or less what my accountant told me to do. Also he
> strongly advised against the use of foreign VAT accounts for any of my
> purchases (as a matter of fact I still have only two accounts - VAT
> Receivable/VAT Payable -, and both are in use for Belgium). That's why
> there's no tax table in the example sent, I just added and subtracted the
> VAT manually. However, this solution creates a problem in that the
> Liabilities placeholder account now has increased so much and I don't know
> what the next step is.
>
> My accountant and I created the example in my first message together but,
> as he isn't familiar with Gnucash (he found it very difficult to use), I'm
> afraid it might contain errors.
>
> I'm not an accountant by any means but I at least want to be able to
> understand what I'm doing with regards to Gnucash.
>
> If it's not too much trouble, would you perhaps be so kind as to send me
> one finished example of the former? Just to make sure I'm understanding
> this correctly. I'm providing an early copy of my own Gnucash file in
> attachment (I deleted all transactions first but all accounts necessary are
> still there).
>
> *I hope, you did not, because negative amounts are reserved for stornos.*
>
> You mean, like in the case of a reimbursed expense?
>
> Thanks for the support!
>
> Jeremy
>
> 2018-07-13 21:35 GMT+02:00 Frank H. Ellenberger <
> frank.h.ellenberger at gmail.com>:
>
>> Hi,
>>
>> Am 13.07.2018 um 17:42 schrieb Geert Janssens:
>> > I don't have access to a gnucash installation currently so I can't
>> verify my suggestion.  But this is how I would handle it.
>> >
>> > - create two vat asset accounts. One for the Belgian vat and one for
>> the foreign vat.
>> > - create a tax table (which is all about vat) for your intra-European
>> purchases. This tax table should have 2 entries
>> > 1. Belgian vat (typically 21%), assigned to the Belgian vat account
>> > 2. Foreign vat, which should be the negative percentage of the Belgian
>> vat  (so typically -21%), assigned to the foreign vat account.
>>
>> While most you are writing seems pretty simular to the situation in DE.
>> I would not use negative rates. Instead I would use the folowing setup:
>> assets:
>>         VAT reimbursable
>>                 Buys @ full rate: 21%
>>                 :
>> liabilities:
>>         VAT
>>                 Sales: 21%
>>                 Import with VAT ID: 21%
>>                 :
>> For an optimal grouping of different rates, other cases of imports etc.
>> compare your setup with your tax forms and discuss it with your CPA.
>>
>> With the rest, I aggree:
>>
>> > - now you can set tge default vat for your German vendor to this tax
>> table.
>> > When you enter you vendor bill on each line you enter the values
>> without vat and double check the tax table is still the one for
>> intra-European purchaes.
>> > - note the purchase of a laptop should also go to an asset account
>> (investment) so that's what you should enter as account in the entry (an
>> entry is one line on your bill)
>> >
>> > - after posting this bill I believe it should create the correct
>> transaction for you, including two vat entries in your assets and the net
>> amount of the lap3in an investment account that can be used for
>> depreciation.
>> > - in addition the bill will be posted for the net amount such you can
>> apply the correct payment.
>> >
>> > The only small detail I don't remember is whether I have changed the
>> gnucash code already to allow negative percentages in tax tables. I think I
>> have though.
>>
>> I hope, you did not, because negative amounts are reserved for stornos.
>>
>> > Geert
>> >
>> > Jeremy D <jeremy.defrere at gmail.com> schreef op 12 juli 2018 22:34:43
>> CEST:
>> >> Hi,
>> >>
>> >> Someone on the #gnucash IRC channel suggested I write this message as I
>> >> have quite a complex issue.
>> >>
>> >> Basically I've made a few purchases the last few months, most of which
>> >> I
>> >> paid without VAT.
>> >>
>> >> Here's a concrete example to help you better understand.
>> >>
>> >> I bought a laptop. This laptop cost € 2016, VAT included. However, as i
>> >> have a VAT number, I paid only € 1694,12.
>> >>
>> >> A few prerequisites:
>> >>
>> >>
>> >>   - My accountant wants me to include foreign VAT as an asset and also
>> >> include Belgian VAT as an asset. He calls that a "null operation" but
>> >> it's
>> >>   necessary, he says.
>> >>   - Looking at my transaction report, we noticed the balance for each
>> >>   month isn't correct. It should be equal to zero.
>> >>  - This purchase has to be used as an investment (asset account) which
>> >>   can then be depreciated each year.
>> >>
>> >>
>> >> I thought I was able to solve the problem by creating a bill linked to
>> >> the
>> >> vendor (Business\Vendor\New Bill), then posting the bill and processing
>> >> the
>> >> payment - amount without VAT linked to checking account/VAT in the
>> >> separate
>> >> VAT account. Below are screenshots of that:
>> >>
>> >> [Purchase minus German VAT]
>> >>
>> >>
>> >>
>> >> [Purchase minus Belgian VAT]
>> >>
>> >>
>> >>
>> >> But the Liabilities:VAT Sales:Belgium looks totally messed up. To be
>> >> honest, I don't think I know what I'm doing anymore. I've tried many
>> >> things
>> >> already but to no avail...
>> >>
>> >> Thank you in advance for the feedback.
>> >>
>> >> Jeremy
>>
>> Regards
>> Frank
>>
>
>
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