Purchasing: VAT on requests and bills

Set the company's default VAT rate, choose the rate on each item, and see a bill with the wrong VAT land in Needs a look.

What's in this video

1. Every item on a purchase request has its own VAT rate, so supplier bills can be checked properly. Start with the company default. In Purchasing, click Purchasing settings.
2. Under VAT, Default VAT rate for lines without one is the rate every new item starts on. Most of what we buy is standard rate, so it stays on twenty percent. If you change it, click Save.
3. Now a request. Click Request to buy, say what it's for, and add the items as usual. We need ten panel filters for the air handling unit at Elm Park Centre.
4. Each line has its own VAT. It starts on your default. For anything at a different rate, choose five percent VAT, or No VAT, on that line. These filters are standard rate, so we leave them.
5. At the bottom, the total is before VAT, with roughly how much VAT goes on top. Click Send request. It's within our rules, so it's approved and ordered from Kestrel straight away.
6. The filters arrive and are taken in as usual. Then Kestrel's bill comes in. Under Bills, click Type a bill in.
7. Choose Kestrel, and the order it's for. Then their bill number, the date, and the VAT they charged. Kestrel have put five percent VAT on the bill by mistake: three pounds forty.
8. Then the line, as it's written on the bill: ten panel filters at six pounds eighty. Click Save and check.
9. The order said twenty percent VAT, and the bill doesn't match, so it isn't approved. It goes to Needs a look, with the reason: the bill's VAT is different from the VAT on the order.
10. The suggestion is to ask the supplier for a corrected bill. Write a note, and click Ask for a corrected bill. If the supplier was right after all, you'd accept the difference instead.
11. Orders made before this change have no rate on their items. For those, a bill may have your default rate or no VAT. Anything else goes to Needs a look.
12. So: set your default once, change the rate on the odd item, and let the checks catch any bill that doesn't match.