What's New: VAT Framework Enhancements

Sage X3 VAT framework is a set of components that allows the definition of VAT boxes, the creation of
a VAT form, the setup of VAT entities, the calculation of the amounts of VAT to declare for a period and
the submission of the VAT return.
There are two new features included in this release, namely, the creation of a generic VAT return
process and the definition of a distinct VAT return at the financial site level.
Duration: 20 minutes

Disclaimer

OVER VIEW AN D PR ER EQUISITES

Overview

Prerequisites

Instructions

GEN ER IC PR OCESS

Setup for Generic Process

 Generic Process description

Check knowledge

DECLAR ATION B Y SITE

Setup for Declaration by site

Declaration by site Process description

Check knowledge

SUMMAR Y

Summary

R ESOUR CES

What's New: VAT Framework Enhancements

ACKN OWLEDGMEN TS

Acknowledgments

CLOSIN G

Sage University
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Disclaimer

Disclaimer
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property of their respective owners.

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Overview

The VAT Framework

The VAT framework is a set of components / functions that allows the definition of VAT boxes, the creation of VAT
form, the setup of VAT entities, the calculation of the amounts of VAT to declare for a period and the submission of
the VAT return. It also has refactored scripts allowing easy duplication and roll-out for new legislation.

This course will present the two new features - generic VAT return process and the VAT declaration at site level.

Generic VAT return process

What are the new features of this generic VAT return process?
 It is now possible to calculate
Calculate and validate a VAT and validate VAT declaration
declaration for a legislation that is not yet
part of the VAT framework.

It is possible to calculate
Calculate multiple declarations
multiple declarations in bulk.

Generic VAT returns can not be

Submission of VAT returns submitted electronically to the
tax authorities.
Updates
What are the entities updated for this new feature?

1 VAT boxes are defined for the legislation associated to the Generic VAT declaration.

2 A VAT form is created based on the VAT box setup.

3 The creation of a Generic VAT return to calculate the amounts to declare for a defined period.

Declaration by site
By using the setup entities, this feature allows the definition of distinct VAT returns at the financial site level.

A VAT entity can be defined for a single or multiple companies and/or sites.

Example:

A company GB10 of British legislation is made up of 3 sites GB011, GB012, GB013.

Sites GB011 and GB012 are implanted in UK. They must submit a UK VAT return to UK tax
authorities. These two sites are grouped in a VAT entity "UKVAT." A VAT return complying to the
UK rules will be created and submitted for this entity.

Site GB013 is implanted in Belgium. It must submit a Belgian VAT return to the Belgian authorities.
This site is linked to a distinct VAT entity "BEVAT." A VAT return complying to the Belgian rules will
be created and submitted to this entity.

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Prerequisites

This course will only present the creation of a generic VAT return and the definition of a distinct VAT returns at the
financial site level.

The VAT framework process must be fully understood to implement these features. Several documentations can be
found on the online help.

Reminder for the feature on the VAT returns on financial site level. The existing control related to the legislation
consistency remains as is, that is, a VAT company can only contain companies and/or sites with the same legislation.

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Instructions

Several screen shots are used to present the setup, data and processes updated in order to take advantage of these
enhancements. Images might not be so visible depending on the type of screen you are using. To make up for these
shortcomings, you can tap the screen shots to enlarge the image and tap again to return to the original size. Some
screens shots may contain interactive icons. Be curious, you might find more information behind them.

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Setup for Generic Process

VAT boxes
VAT boxes is used to define the setup of the VAT return preparatory report structure and the assignment rules for
each VAT declaration box.

The new Generic VAT declaration (DCLVATGEN) is now available in the list of functions.
VAT boxes and the selection criteria for each box must be defined for the declaration DCLVATGEN and the given
legislation code.
VAT box setup for BRI legislation.
 VAT box setup for FRA legislation

VAT form
VAT form contains the data to be extracted and edited if needed by the user. It is possible to create different VAT
forms with different validity dates for the same declaration to preserve the format structure evolution history.

The VAT form function now allows the selection of the declaration code DCLVATGEN.

A VAT form defined for the BRI legislation using the generic declaration process.
 

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 

Of ine mode

If the offline mode is activated, the VAT return will have a status of Validated after using the Validate button in the VAT
returns function. Submission is disabled.

If it is not activated, the VAT return will have a status of Completed after using the Validate button in the VAT returns
function. Submission is enabled.
 

Generic declaration

Creation of the VAT form with the generic script and the associated legislation.

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Generic Process description

VAT return creation

A VAT return is defined using the VAT form based on the generic declaration DCLVATGEN. It calculates the VAT
amounts to be declared to the authorities and proceeds to its submission.

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 

Company/Site

Companies and sites are included in the VAT entity.

VAT return process

The VAT return process has been modified. The declaration can now be extracted in Simulation and/or Actual.

 

Calculation mode

Actual : updates the declared VAT amounts on the Journal entries.

Simulation : calculates the VAT boxes without actual update of entries.

Calculation of VAT returns

The grid VAT to declare and Detail by company will be calculated based on the rules of the VAT boxes and VAT
form.
Validate with offline mode
If the VAT return is validated in the offline mode, the status changed to Validated and all the other actions are
disabled.
Validate with online mode
If the VAT return is validated in online mode, the status changed to Completed and all the other actions are disabled.

Conclusion
You might have observed that whether in offline mode or on online mode, after validation of the VAT returns, all the
options are disabled. This is how the Generic VAT process is managed. Generic VAT returns cannot be submitted
electronically to tax authorities.

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Check knowledge

Here is a short quiz to test your knowledge. The pass mark is75%! Good luck!
Question

01/04

Match the description to each choices.

contain the allocation rules for the VAT

VAT returns amounts to declare when processing journal
entry.

VAT boxes contain the structure of the VAT return.

 contain the amounts to be declared and
VAT entities
submitted to the authorities.

define the list of Business units that must be

VAT forms
included in the VAT declaration.
Question

02/04

What VAT declaration can be used for a legislation that is not yet part of the framework?

Type your answer here

Question

03/04

When validating an online mode generic VAT declaration, the status is changed to:

Type your answer here

Question

04/04

What does a typical VAT declaration contain? (choose all the correct answers)

Amount of sales

Amount of purchases

Related VAT amounts

Expenses
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Setup for Declaration by site

VAT entity
The ability to generate a VAT return at the site level is based upon the VAT entity setup. The VAT entity defines the
list of Business units that must be considered when generating the VAT declaration. For this new release -
declaration on the financial site level - the site must be defined in the VAT entity.

Here's a review of the setup of VAT entity:

It is possible to create a Mono VAT entity meaning only one company and/or one site or

Multi VAT entity with multiple companies and/or sites but all must be legal companies. The main
ledger must be in the same currency and must be associated to a single legislation.

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 

Head member

One of the Business units. A company or a financial site must be identified as the Head member.
 

Charateristics of the head member

At least one VAT identifier - an address and/or tax number.

When the country entered has a control script (Belgium, Spain, France, Italy, Poland and Portugal), the related
format controls are enforced on the Company tax ID no. and/or the EU VAT no.

For country GB, the existing control is now made on the EU VAT no.

According to the type of business, the VAT registration Number can contain more than 9 digits and have a specific
structure. Such numbers can be entered in the Additional tax identifier field. They will not be controlled and they
will not be sent to HMRC (Her Majesty Revenue & Customs). The Sage X3 submission will use the EU VAT no.
Rules in the declaration by site level

When the member site is empty, all financials sites of the Member company will be included in the
VAT entity.


 

Member site is empty

If Member site is empty, all the sites of the Member company will be included in the VAT entity.

When the Member site is not empty, only the mentioned site of the Member company is included in
the VAT entity.

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 

Rule n° 1

If the member site is empty, all financials sites of the Member company will be included in the VAT entity.

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 

Member site

Only sites mentioned in the Member site will be included in the VAT entity.

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Declaration by site Process description

VAT returns for a site

The VAT return is created using the VAT entity defined at the site level.

 
 

Head member

The Head member will display Company and site codes, if the site is a head member.
 

Information of VAT entity

Information of the VAT entity - Company tax ID number, EU VAT no., Additional tax identifier has been added.

They will be used for the extraction and submission.

VAT to declare section

The section containing the amounts to declare has not been modified.

Reminder: if the simulation is executed for a given financial site, only the values for this site will appear in the
simulated value.
A new button in the VAT returns
A new button is added to list member sites of a VAT entity.
VAT on payment
VAT declaration at site level.

Before the implementation of the VAT declaration at the site level (VAT extraction at company level only = all
sites):

When an invoice is on multiple sites (and using VAT on payment tax codes), the site that is considered
when running VAT extraction in simulation (on a site) is the site of the triggering payment journal
entry line on the Business partner record.

Sites on the invoice journal entry lines for base accounts / VAT accounts are not considered. The basis
amount without VAT and the VAT basis amount are considered globally.

For this new release, VAT declaration at site level, the use case mentioned above can not be managed. A new
parameter on chapter CPT of group VAT allows to prevent such VAT extraction. This parameter indicates:

1 that the VAT on payment cannot be executed at all if the VAT entity is a list of sites (blocking
message).

2 or that the VAT on payment can be executed when the VAT entity is a list of sites (warning message).

 

VALPAYFCY

There are two values: Blocking or Warning. Blocking is the default value.

Blocking message when launching a declaration by site when the parameter VALPAYFCY = Blocking.
Reports
The following reports and the selection criteria for these reports have been updated to take into account the new
possiblities of setup in the VAT entity and the declaration at the site level.

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

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 

DCLVATBOXDEB (1&2)
 

DCLVATBOXPAY (1&2)
 

VATRETURN
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Check knowledge

Here is a short quiz to test your knowledge. The pass mark is 75%! Good luck!
Question

01/04

Which record should be set up in order to generate a VAT return at financial site level?

VAT boxes

VAT forms

VAT entities
Question

02/04

If the VAT Registration Number is more than 9 digits, where would the other identifiers of the code
stored?

Company tax ID no.

EU VAT no.

Additional tax identifier

Question

03/04

On the VAT entity, the set up is - GB10 has GB011 as member site, while GB20 has no member site,
which sites will be included in the calculation of the VAT return?

All sites of GB10 and GB20.

All sites of GB10 but no sites of GB20.

All sites of GB20 but only site GB011 of GB10.

Site GB011 of GB10 and no site of GB20.

Question

04/04

If on the VAT entity, the head member is a site, what will be displayed in the Head member fields of
the Extraction criteria?

Type your answer here

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Summary

Generic VAT declaration

It is now possible to calculate and validate a VAT declaration for a legislation that is not yet part of the VAT
framework through this generic VAT return process. Multiple VAT declarations can also be calculated in bulk, but it
is not possible to submit VAT returns electronically to tax authorities. There's no online file submission or file
export.

The "Offline" / "Online" mode of VAT returns

After the extraction has been executed in the Actual generation type and the button "Validate" has been clicked:

If on offline mode, the status is set to Validated. This can be used to recover existing entries that won't
be submitted, for tests or for before go live.

If on online mode, the status is set to completed.

In the UK-HMRC context, the behavior is a bit different.

If on offline mode, the user is not redirected to the HMRC website and must enter the obligation
period. After validation, the same rule for offline mode, as above is applied.

If on online mode, the user is redirected to the HMRC website and must enter valid credentials and
select obligation period. After validation the status is set to Validated. Pressing the action Submit
will submit the VAT return online to HMRC and the status is set to Completed if no errors occurs.

VAT declaration at site level

In this new release, VAT declaration can now be defined at the financial site level. A VAT entity can be defined for
single or multiple companies/or sites.

A new Member sites button is added.

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What's New: VAT Framework Enhancements

whats-new-vat-framework-enhancements.pdf
6.9 MB
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Acknowledgments

All information are taken from the SFR_2020R3.

Thanks to all the reviewers for their patience and great help to make this eLearning course as accurate
as possible.

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