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Starting from 1993, along with the creation of the European market and the knocking down of the fiscal frontiers, purchases made within the European Union are usually subject to taxation in the country of destination. In this case, the tax is owed by the recipient according to the reverse charge system.
Recently, the European Union has given way to a testing phase allowing each member to apply the reverse charge system also in special sectors of their National transactions, this in order to tackle evasion. For example, up until 2013 in Italy, Germany and Austria, reverse charge will be applied on transactions regarding mobile phones and integrated circuit devices.
Furthermore, the European Union, in the Green Paper on the future of VAT (published one year ago), opened a debate on the VAT system with the aim of simplifying such system, evaluating as well the possibility to force all countries to apply in any case the reverse charge system on national operations.
From an administration point of view, the question is: what to do when we receive an invoice subject to reverse charge? Theoretically the invoice should be posted twice, both as received invoice and as issued invoice, in order to post the tax on purchases as well as the tax on sales.
Perhaps not everyone knows that… Mago.net has always allowed to post the reverse charge in a single journal entry, by using special accounting templates that post the document also in Sale Tax Journal.
In order to acquire further knowledge, please contact your reseller referral and in addition if you are a M.L.U. subscriber you can follow the course NON EXISTING PAGEMago.net – Received Documents.
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