Need for NZ - 0% tax code to provide Tax Invoice title when 0% GST

[Pix]

Hi,

I have just started using Manager and must applaud the easy to follow guides and also the masses of help in the forum.

In setting up, I have found a few issues but the help from the guides and forum solved most of them, but I have just discovered one issue I can’t find the answer

On sales invoices I need to have the title "Tax Invoice "and by setting my country code (NZ) it defaults to “Tax Invoice” when the NZ Taxable code of 15% is shown on a product line.
However when I have zero or exempted supplies like when I supply direct to Australia or other overseas countries I still need to have the invoice title as “Tax Invoice” but this invoice will be headed just “Invoice”.

I did try the fix of changing the theme {{title | replace: “Invoice”, “Tax Invoice”}} but this shows as “Tax Tax Invoice” on local invoices and “Tax Invoice” on zero rated invoices. I also tried creating a custom 0% rate but it made no difference.

Some help would be appreciated, thanks

[Brucanna]

Why do you want to remove “Tax Invoice” from 0% or exempt supplies.

0% is still a tax rate just like 15%, just the number is different.

[Pix]

I am referring to the heading title of the invoice which must show “Tax Invoice” regardless of which tax rate is charged 15% or 0% or whatever

[Brucanna]

Sorry, I got things mixed up there.

Why do you want “Tax Invoice” on an invoice that isn’t related to tax.

[Pix]

Its still a tax invoice but the rate charged is 0%

[Tut]

Let’s try to sort things out for you, @Pix.

First, you mentioned you had set your “country code” to NZ. There is no country code anywhere in Manager. So it is not clear what you were referring to. I suspect you meant an in-built NZ tax code.

Second, the switch of title from Invoice to Tax Invoice occurs only when an in-built tax code is applied for a country where the Tax Invoice title is known to be a requirement. No tax code, no switch of title. Unknown requirement, no switch of title. Custom tax code, no switch of title.

Since there is no in-built 0% NZ tax code, you are presumably not selecting any tax code on your exempted sales, which is what you should be doing. And Manager is behaving exactly as designed.

Now, if there is actually a requirement in NZ for the switched title on invoices that do not apply taxes, please provide a link. The program has lots of NZ users, many of whom surely export tax-exempt goods. No one has complained about this being a problem. My belief would be that it is not, since a sales invoice with no tax implications is not likely required to be named Tax Invoice. Exceptions to that last statement come in places like the EU, where 0% tax codes are used because of where and to whom taxes are paid. I confess to being completely ignorant of NZ tax law, so please enlighten me with a link to some regulation if there is a requirement. In that case, the solution will be for the developer to add a tax code for NZ - 0%.

[Pix]

Here is the link from the tax authority (IRD) on what must be shown on a tax invoice, it also states that “Tax Invoice” must be shown

Also important to note that there are different GST rates 15%, 0%, and exempt with the last two whilst the amount of GSTis $0 there is a difference apparently.

http://www.ird.govt.nz/gst/work-out/work-out-records/records-tax/tax-info/

[Brucanna]

“Invoice” heading indicates a business that is not registered for GST
"Tax Invoice" heading indicates a business that is registered for GST

Just because a registered business has a 0% or exempt transaction doesn’t mean that they become “unregistered” for that transaction (Invoice only heading). They must always use Tax Invoice on their invoices regardless of the tax status of the transaction.

[Pix]

Yes, Brucanna, thats how I see it

Being a GST registered business I must issue tax invoices which clearly show what GST I charged so when I submit my GST Return, both the inputs and outputs can be seen.

[sharpdrivetek]

as a temporary solution you can have a default theme and an additional custom theme with the title changed like you have described in your initial post.

when using any tax rate other than 0% use the default theme and when using 0% switch to the custom theme.

[Tut]

The right solution is for a NZ - 0% tax code to be added. I am inviting @lubos to join this topic so he sees the need.

[Pix]

Thanks Tut
and thanks sharpdrivetek, that thought had occurred to me as well

[lubos]

However when I have zero or exempted supplies like when I supply direct to Australia or other overseas countries I still need to have the invoice title as “Tax Invoice” but this invoice will be headed just “Invoice”.

This is actually correct. According to GST act (at least my interpretation), you issue Tax Invoice only if you are registered for GST and at the same time making taxable supply. If you are not charging GST, you are not making taxable supply therefore you should be issuing just Invoice, not Tax Invoice.

However, these days, everybody registered for GST is issuing Tax Invoice whether they are making taxable supply or not. This is not how it’s meant to be but it became a norm out of convenience.

The question is, should Manager enforce the correct rules as per law or just match user’s expectations. I can guarantee you, if Manager would try to match user’s expectations, there would be someone out there complaining Manager shouldn’t call non-tax invoice Tax Invoice.

Perhaps the best approach is to let users name their invoice whatever they like (like it is done under Sales Quotes tab).

[Pix]

Thanks Lubos for your reply

My interpretation and also that of my accountant is that if an invoice is issued for a GST taxable supply regardless of the rate and that rate can be 0% then a Tax Invoice must be issued.

Currently New Zealand has three rates

1. 15%
2. zero rate
3. Exempt

Exempt supplies are quite different from the zero rate as they are for financial services, residential rental and the like. GST inputs cannot be claimed on expenses relating to exempt sales whereas GST can be claimed on expenses relating to zero rated sales

So a GST calculation does apply to invoices issued where the rate is zero, as well as 15% but not for exempt invoices. Zero rated supplies are still a taxable supply.

[lubos]

I see. So what your accountant is saying, GST Exempt sales don’t have to make invoice heading Tax Invoice while GST 0% have to. Correct?

[Pix]

Yes, but as you said earlier the practice is to head all invoices Tax Invoice as it saves having to have two separate invoice forms

[lubos]

@Pix, both taxes codes added to the latest version (17.10.65), however GST Exempt tax code won’t rename invoice to Tax Invoice, only GST 0% tax code will.

[Pix]

Thanks for your prompt attention