Create & Post a Vendor Credit Memo with VAT Reporting

Overview

The process to create a vendor credit memo is almost identical to entering a vendor invoice. The main difference is that the Payable Lines will be entered with negative values. If the amount of the Account Payable is negative, the invoice type will automatically switch to a credit memo. In the Avalara VAT (value-added tax) Reporting, a VAT credit amount will display when you post a credit memo. If a credit memo is unposted, the amounts in Avalara VAT Reporting will display as positive amounts to reverse credit memo.

Do you want to:

• Create & Post a Vendor Credit Memo
• View the Vendor Credit Memo in VAT Reporting
• Unpost a Vendor Credit Memo

Create & Post a Vendor Credit Memo

1. From Accounting Home, under Cash Out select Payables (Vendor Invoices).
2. From the list view, click New to create a new credit memo. Otherwise, select an existing Payable and click Clone with Lines to create a new credit memo. 
3. If you click New, select or enter the following:
   
   1. Ledger
   2. Currency
   3. Vendor or Contact
      Important: Payee cannot be an Employee when a VAT Tax Group is selected on a Payable Line. 
   4. Payee Reference
4. Complete any additional fields, if necessary. 
5. Click Save. The Payable record displays. 
6. Scroll down the page to the Payable Lines related list. To add Payable Lines, click Mass Add/Edit Rows.
7. Click Add New Line.
8. (Optional) Click the Lookup icon to search for and select a Product for the line. 
9. Enter the Quantity.
10. Enter the Unit Cost - the cost per unit. This is a required field.
    Note: In order for this to be a credit memo, the Unit Cost must be entered as a negative amount.
    
    Important: The Total field is recommended to be read-only on the user interface. The amount that is entered in the Unit Cost field multiplied by the Quantity will determine the Total (Quantity x Unit Cost = Total). If the Quantity field is blank, upon saving, a Quantity of one will auto-populate for the line.
    
    The Total field is controlled by Field Level Security (FLS). Therefore depending upon the permissions granted through a user’s Profile and/or Permission Set(s), the Total field might be editable. However, editing this field directly in the UI is NOT recommended.
11. Enter or search for an Expense GL Account.
12. Click the Lookup icon to search for and select a Tax Group for the line. 
    Tip: To view all of the available Purchases Tax Groups for your country, enter the first three letters of the Tax Group. For example, for Great Britain, enter “GBP” in the Lookup search textbox and click Go. 
13. (Optional) Add additional lines. 
14. 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.

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View the Vendor Credit Memo in VAT Reporting

1. To view the credit memo in Avalara, log into your VAT Reporting Account. 
2. From the Transactions menu, select Processed Documents.
   
   
   
   
3. (Optional) Select/enter any or all of the following, and then click Apply.
   1. Company
   2. Processed After
   3. Processed Before
   4. Filename Contains
   5. Only Show Manual Documents (Only applicable if manual documents were created in Avalara VAT Reporting.)
4.  Under File name, click the hyperlink for the Payable that you want to view (the record that was unposted). 
   Note: In addition to the Payable number, each filename includes a date and time stamp. This information is included so that each Payable/Invoice Number can be uniquely identified. 
   
5. Click the Invoice Number hyperlink.
   
   
   
   
6. 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 credit memo displays negative amounts.
   Note: The Document Type will display as 3 - Purchase Credit. This Document Type will display for vendor credit memos that are posted or unposted.
   
   
7. Scroll down the page to display the Additional Document Data.
   Note: Since this is a credit memo, the Value for the Taxable Basis and the VAT display as credit amounts.
   
   

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Unpost a Vendor Credit Memo

1. From Accounting Home, under Cash Out select Payables (Vendor Invoices).
2. From the Payables related list, display the credit memo that you want to unpost. 
3. Click Unpost.
4. From the Payable Unpost intermediate screen, click Unpost again to unpost the record. The Payable record refreshes.
   Note: Since the credit memo was unposted, the transactions will no longer display in the Transactions related list.
   
5. To view the unposted credit memo in Avalara, log into your VAT Reporting Account. 
6. From the Transactions menu, select Processed Documents.
   
   
   
   
7. (Optional) Select/enter any or all of the following, and then click Apply.
   1. Company
   2. Processed After
   3. Processed Before
   4. Filename Contains
   5. Only Show Manual Documents (Only applicable if manual documents were created in Avalara VAT Reporting.)
8.  Under File name, click the hyperlink for the Payable that you want to view (the record that was unposted). 
   Note: In addition to the Payable number, each filename includes a date and time stamp. This information is included so that each Payable/Invoice Number can be uniquely identified.
   
   
   
   
9. 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.
   
   
   
   Note: The Document Type will display as 3 - Purchase Credit. This Document Type will display for vendor credit memos that are posted or unposted. 
   
   
10. Scroll down the page to display the Additional Document Data.
    Note: Since this is an unposted credit memo, the Value for the Taxable Basis and the VAT display as positive amounts.
    
    

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