in Egypt we Add 14% as Vat on sales invoice
and we discount 1% for Tax deduction and addition
i know how to add Vat already but how i can discount 1% from the same invoice as a Tax too ?!
Could you please illustrate these tax deductions and addition elaborately. If you can also provide sample invoices, then that would be great.
like this invoice
this 1 % is payable it’s credit just like vat
You need to furnish more information, @Ahmed_Saif. Does anyone pay this “Tax deduction and addition?” If so, who? Or is this some form of input VAT offset against output VAT?
If no one pays, why is the VAT rate not simply reduced to 13%? And is the calculation 1% of the subtotal before any other tax amounts, as shown in your illustration? Or is it calculated on the total including tax?
When you say it “is payable it’s credit,” what do you mean? Where is the credit applied?
Tax deduction and addition is a tax in Egypt Aim to discount 1 % of purchases invoice and then i pay this Value to the Government
i can handle it when i make sales invoice i use Withholding tax … so it’s good and fine … but in purchases invoice i want to discount 1 % too from the invoice in a Liabilities account to pay it just like Vat to government ----
so how i can discount 1 % from purchases invoice in a Liabilities like vat ?
I don’t understand.
If you deduct 1% from your Sales Invoice and pay it to the government then surely your suppliers do the same?
Your supplier will do the calculation for you in his invoice, so neither you nor manager has do the calculation.
Therefore, you can just enter that value as a separate line and you should be good to go.
Previously, we were able to create non-inventory items linking to balance sheet account so you could standardize that procedure, but now you can’t. You will have to fill in the tax account manually on the lines.
The guide on Withholding taxes is here Account for withholding tax (tax withheld at source) | Manager
suppliers deduct 1 % from sales invoice as a Assets so they will Reduce other tax by this value … so suppliers deduct 1 % from sales invoice but they take it back as a discount on another tax
But As a purchases invoice for clients they have Prove this 1 % as a liabilities and they will pay this value to government …
hmm… Egyptian Life Style
I believe @Ahmed_Saif is referring to what they call “Withholding Vat” where all or a portion of input VAT is withheld and paid to the Tax Authorities on behalf of the Supplier to reduce evasion.
I believe the Tax code function can be upgraded to allow a negative tax component line to record the payable (doesn’t work in Manager now).
Withholding VAT is not widespread. In my country, only corporate entities with some level of capital or operating in some industries are required to Withhold VAT.
Withholding VAT receivable and Withholding VAT payable are not to be offset.
Yes, that would have been useful here. Because using the VAT code itself to track the payables and receivables (which is received in the form of a withholding certificate) would require the use of two tax codes, 1 for input and another for output.
@Ahmed_Saif Balance sheet items can now be used for non-inventory items. Create a purchase only non-inventory item to track the withholding vat payable. Enter negative numbers on that line.