In addition to selling goods and services in your home country, you might also sell to other countries. Distance sales represent the selling of goods across borders. Some countries have under and exceeded thresholds for the goods that are sold. If a threshold is exceeded, a tax amount might be due to the other country. For example, your home country is the United Kingdom, and you made a sale that exceeded the threshold in the country of Belgium. Using this example, since the threshold was exceeded, taxes might have to be paid and reported into Belgium.
Note: In order to be able to select a different currency, Multi-Currency must be enabled.
Do you want to:
Create & Post a Billing with a Distance Sale Threshold Exceeded
- From Accounting Home, under Cash In select Billings (Customer Invoices).
- From the list view, click New to create a new Billing.
- Select the appropriate Currency from the drop-down list.
Note: With Belgium as the example distance selling country, EUR is selected as the currency.
- Select the Customer.
- (Optional) Complete any additional fields.
- Click Save. The Billing record displays.
- Scroll down the page to the Billing Lines related list. To add Billing Lines, click Mass Add/Edit Rows.
- Click Add New Line.
- (Optional) Click the Lookup icon to search for and select a Product for the line.
- Enter the Quantity.
- Enter the Unit Price.
- Enter a Revenue GL Account. Otherwise, click the Lookup icon to search for and select a Revenue GL Account.
- Click the Lookup icon to search for and select a Tax Group for the line.
Note: In this example, GBS-DSEU-BE is selected as the Tax Group because it is one that exceeds the threshold of distance sale of goods that applies to Belgium.
Tip: To view all of the available Sales Tax Groups for your country, enter the first three letters of the Tax Group in the Lookup search textbox. For example for Great Britain, enter “GBS” in the Lookup search textbox and click Go. Otherwise, you can view all of the available Tax Groups from Accounting Home, under Master Data Setup | Tax Groups.
- (Optional) Add additional lines.
- At this point, you can select one of the following: Save & Complete, Save & Post, etc.
Note: Posted records can be viewed in Avalara VAT Reporting.
View the Billing in VAT Reporting
- To view the Billing in Avalara, log into your VAT Reporting Account.
- From the Transactions menu, select Processed Documents.
- (Optional) Select/enter any or all of the following, and then click Apply.
- Processed After
- Processed Before
- Filename Contains
- Only Show Manual Documents (Only applicable if manual documents were created in Avalara VAT Reporting.)
- Under File name, click the hyperlink for the Billing that you want to view.
Note: In addition to the Billing Number, each filename includes a date and time stamp. This information is included so that each Billing/Invoice Number can be uniquely identified.
- Click the Invoice Number hyperlink.
Note: The currency is in EUR because this invoice exceeded the distance sale threshold. Therefore, the VAT (value-added tax) will need to be reported and paid to the other country.
- Click the Invoice Number hyperlink again to drill-down for viewing line item details. Then, scroll down the page to view each line, as necessary.
The amounts display for your home currency and for the foreign currency.
- Scroll down the page to display the Additional Document Data.
Note: In our example, the distance sale threshold for Belgium is exceeded. Therefore, the VAT (valued-added tax) amount should be reported and paid to Belgium. In the sample screen below, the VAT Return Country Code information is included for Belgium to indicate the VAT that will be paid to Belgium. In addition, for informational purposes, the Value amounts display for the home country (United Kingdom).