I am in EU, V.A.T registered and have my first V.A.T registered customer in another EU member state.
I called the V.A.T dept and they have told me that the invoice should show “Reverse charge” and 0%.
When looking at this tutorial:
I am a bit confused as it will still shows my V.A.T with RCM in front of it.
What would be the difference between creating a custom tax at 0% without clicking on the reverse charge tick box, and one by clicking on the tick box? It is my understanding that by clicking it, you get access to an extra reverse charge report, am I correct? But accounting wise, the V.A.T should not be added anyway.
From what I understand, where B2B trades happen between EU countries, the V.A.T is levied on both the seller and the buyer(really on the buyer). Did I understand this correctly?
The part I am not understanding is…If EU countries remove V.A.T from B2B between them, how to they make money? Only on B2C?
I tried to find Youtube videos on this but it is not clear.
In between the post I tried to create a new tax code and ticked the reverse charge. All the amount I have input are red, any idea why, please? My quantities are also showing in minus
I am using this version: