(ITA) Setting Up Functionality for Italy

This chapter provides overviews of company setup for tax reporting entities and Italian withholding taxes; and discusses how to set up:

• User-defined codes (UDCs).

• Automatic accounting instructions (AAIs).

• Next numbers for delivery notes.

• Address book information for a tax reporting entity.

• Data dictionary for withholding.

• 30/60/90 end-of-month invoice date.

• Payment formats.

• Draft remittance formats.

• Supplier withholding tax information.

• Withholding tax codes.

• Register types and classes for summary VAT (value-added tax).

• An initial VAT balance.

• Corresponding versions.

See Also

(Europe) Setting Up European Union Functionality

Understanding Company Setup for Tax Reporting Entities

You must set up your reporting company with a value of 3 in the Person/Corporation Code field (data item TXC) in the Address Book Revisions program (P01012). When you set up the company with a value of 3, the system enables you to complete both the Tax ID (data item TAX) and the Add'l Ind Tax ID field (data item TX2).

You must complete both the Tax ID and Add'l Ind Tax ID fields or the system will not generate the Italy Annual Customer and Supplier List report.

You can enter the same value for both fields.

See Generating the Annual Customer and Supplier List Report.

Understanding Italian Withholding Tax

In Italy, businesses must withhold taxes from payments to certain types of suppliers, such as self-employed and contract suppliers. These withholding taxes are remitted directly to the government. Each year, businesses must submit the Model 770 (Modello 770) form to the tax authorities. The Modello 770 form contains information about the suppliers from whom withholding tax has been collected.

In some cases, businesses can defer the recognition of accounts payable value-added tax (VAT) receivable (input) on vouchers for suppliers who are subject to withholding tax until the voucher is paid. The document used to defer the VAT is called notula.

Businesses must also give a certification of all of the amounts that are paid for their services, including detail of the tax withheld, to all their suppliers who are subject to withholding tax.

To track withholding tax records through the withholding tax process, refer to the Withholding Tax Status field. The system automatically updates this field for each tax record, based on the status of the record in the withholding tax process.

1. Voucher Entry

This table describes the first step in the withholding process for Italy:

Status Code: 0

AP Trade Amount: 119-

Expense Amount: 100

VAT Amount: 19-

2. Voucher Payment

This table describes the second step in the withholding process for Italy:

Payment Date: 01/10/05

Status Code: 1

AP Trade Amount: 119

Expense Amount: 109-

VAT Amount: 10-

3. Payment to Fiscal Authorities

This table describes the third step in the withholding process for Italy:

Withholding Paid Date: 15/10/05

Payment Number: 1031

Status Code: 2

Cash Amount: 10-

Withholding Payable Amount: 10

4. Fiscal Reports

The system generates these reports for withholding:

• Annual Declaration of Withholding Tax Information by Supplier.

• File Generated to Interface to Official 770 Form.

INPS Withholding Tax

In addition to the standard withholding tax, payment to certain types of contractors is subject to a social security (Istituto Nazionale Previdenza Sociale [INPS]) withholding tax. The INPS withholding tax is paid to the Italian social security office.

The company must withhold two-thirds of the withholding tax amount that is due to the contractor and pay this amount by the 20th day of every month. The supplier is liable for the remaining one third of the ten percent.

The base amount for the calculation of INPS withholdings can be 95 percent or 100 percent, depending on the type of contractor.

The company is liable for the debt to INPS from the time of payment to the contractor.

Notula

Notula is the document that is used by a company to defer VAT recognition until payment of a voucher is made. Notula is used for suppliers who are subject to withholding tax. You should use the prepayment process in the base software to process notula.

Setting Up UDCs for Italy

Setting up Italian-specific UDCs enables you to use Italian-specific functionality. You also set up some base software UDCs with Italian-specific values.

Setting Up UDCs for Tax Processing for Italy

Before you set up the system to process taxes for Italy, set up these UDCs.

VAT Codes for Year-End Proc. (00/IV)

Set up VAT codes to associate a tax rate to a transaction. For example, you might set up codes for:

• VAT rate 0 percent

• Excluded

• Nonrecoverable 50 percent

• Nonrecoverable 100 percent

• VAT 4 percent

• VAT 20 percent

VAT Register Class (74/01)

Set up register class codes to track and report VAT in a summarized format. For example, you might set up codes for these register classes:

• Purchases

• Correspondent

• No deduction

• Sales

VAT Register Type (74/02)

Set up register type codes to track and report VAT in a summarized format. For example, you might set up codes for these register types:

• Purchases (Tax Italy)

• Purchases (Tax CEE)

• Purchases (Tax extra CEE)

• Tax not deductible

• Sales (Tax Italy)

• Sales (Tax CEE)

• Sales (Tax extra CEE)

• Suspended VAT

Suspended VAT Document Types (74/DT)

Use UDC (74/DT) to set up a cross-reference between the document type for suspended VAT and the document type for suspended VAT-recognized. For example, to cross-reference document type Q9 (suspended VAT) with document type Q7 (suspended VAT - recognized), enter Q9 in the Code field and Q7 in the Description 01 field.

The system uses the document type that you enter in the Code field (Q9 in this example) when you generate suspended VAT amounts. When you receive payment for the invoice for which VAT was suspended and run the Suspended IVA - Receipts/Rebate Control Reports program (R74076C), the system uses the document type that you enter in the Description 01 field (Q7 in this example) to record the VAT that is recognized when full or partial payment is received for the original suspended VAT (Q9) document.

You must also set up the codes for both the suspended VAT and the suspended VAT-recognized document types on user-defined codes (00/DT) and (00/DI).

Suspended VAT Rates (74/SP)

Set up codes to identify the tax rate at which the system calculates suspended VAT amounts and to cross-reference the tax rate for suspended VAT with the VAT payable tax rate. For example, to cross-reference the tax rate SOSP20 (for suspended VAT) with the tax rate IVA20 (for VAT payable), enter SOSP20 in the Code field and IVA20 in the Description 01 field.

The system uses the GL Offset for the tax rate that you enter in the Code field (SOSP20 in this example) to post suspended VAT amounts to a suspense account. When you receive payment for the invoice for which VAT was suspended and run the Suspended IVA - Receipts/Rebate Control Reports program (R74076C), the system uses the offset for the tax rate that you enter in the Description 01 field (IVA20 in this example) to reclassify the recognized portion of the suspended VAT to a VAT payable account.

Setting Up UDCs for Withholding Taxes for Italy

Before you process withholding taxes for Italy, set up these UDCs.

Section of 770 Form (74/RA)

Set up codes to identify the information to use when you create your Model 770 form sections. For example, you might set up codes for this information:

• INPS withholding

• Self-employment revenues

• Sales commissions

Form 770 Information (74/70)

Set up codes to identify information for the 770 form. This code indicates whether the supplier is a resident of Italy and whether the supplier's revenue is partially, totally, or not subject to INPS withholding tax.

Set up these codes:

• 0: Resident

• 0A: Resident whose income is all subject to INPS.

• 0B: Resident whose income is partially subject to INPS.

• 0C: Resident whose income is not subject to INPS.

• 1: Nonresident whose income is all subject to INPS.

• 1A: Nonresident whose income is partially subject to INPS.

• 1B: Nonresident whose income is not subject to INPS.

• 1C: Nonresident.

Country Codes for 770 Form (74/CN)

Set up the numeric country codes that have been defined by the fiscal authority for use on the 770 form. The Codes field must contain the same country codes as UDC 00/CN. The Description 01 field must contain the corresponding numeric code as defined by the fiscal authority. The system uses UDC 74/CN with UDC 00/CN to convert country codes to the proper numeric format for the 770 form.

Withholding Tax Government (74/IM)

Set up codes to further define withholding tax information for your suppliers. You specify the government withholding tax information for each code in the Special Handling Code field. The codes that you specify are for internal use to link the government information to withholding tax types (UDC 74/WT).

Valid values for the Special Handling Code field include:

• 1: Self-employed

• 2: Sales commissions

Withholding Tax Fiscal Code (74/WF)

Set up codes to identify the withholding taxes that you process for your suppliers. For example, you might set up withholding tax fiscal codes as follows:

• 1038: Fiscal Code 1038

• 1040: Fiscal Code 1040

Specify a special handling code to indicate the conditions of the withholding tax. Values for the Special Handling Code field are:

• A: Code applies to persons in receipt of sums that are subject to withholding tax as advanced payment.

• B: Code applies to persons in receipt of sums that are subject to withholding tax by way of tax advance.

Withholding Type (74/WT)

In Italy, suppliers can be eligible for different types of withholding tax. For reporting and processing purposes, set up codes to identify the types of withholding tax that apply to your suppliers.

Set up these codes:

• E: Sales commissions withholding (ENASARCO)

• I: Social security withholding (INPS)

• R: Standard withholding tax

Withholding type codes are linked to an internal withholding tax code, which you set up in the Withholding Tax Codes - Italy program (P740405).

Setting Up UDCs for the Annual Customer and Supplier List

Before you generate the Italy Annual Customer and Supplier List report, set up these UDC tables:

VAT Codes for Year-end Proc (00/IV)

Set up this UDC table with tax rate area codes that you use for transactions that are subject to VAT. Enter these values in the Description 02 field:

The system uses the values in this UDC table to identify transactions that are subject to VAT or that are exempt from VAT.

Note. If the tax rate area is not included in the 00/IV UDC table, the system assumes that the transaction is a taxable transaction with VAT that is not included on the invoice.

Document Type - Annual Report (74Y/DT)

Set up this UDC table with the document types that you want to include or exclude from the Italy Annual Customer and Supplier List report. Enter the document type in the Code field, and enter 1 in the Special Handling Code field for document types that you want to include in the report. Enter 2 in the Special Handling Code field for the document types that you want to exclude form the report.

Set up document types for credit and debit notes, and assign those document types a special handling code value of 3. The system will search for related invoices and vouchers for documents that are assigned a special handling code value of 3.

Setting Up AAIs for Italy

This section discusses how to set up AAIs to work with:

• The annual close process in Italy.

• Supplier withholding taxes.

Setting Up AAIs for the Annual Close Process

In addition to the standard AAI items, these AAI items must be set up in preparation for the annual close in Italy:

See Understanding Setup Requirements and Common Tasks.

Setting Up AAIs for Withholding

To identify the Withholding Tax account in your chart of accounts, set up the PKD (Discounts Available) and PKL (Discounts Lost) AAIs with the same object account.

Setting Up Next Numbers for Delivery Notes

This section provides an overview of next numbers for delivery notes and discusses how to set up next numbers for delivery notes.

Understanding Next Numbers for Delivery Notes

Use the Delivery Note Number Setup program (P7400007) to set up next numbers for delivery notes. You must use a delivery note instead of a consignment note if you use differed vouchers because the delivery takes place on a date other than the invoice date. The system stores the information that you set up in the Business Unit / Doc Type Next Number table (F7400007).

The system uses the numbering scheme that you set up when you use the Invoice Print program (R42535) to print the delivery note.

Forms Used to Set Up Next Numbers for Delivery Notes

Setting Up Next Numbers for Delivery Notes

Access the BU/Doc Type Next Numbers Revisions form.

Business Unit	Enter the business unit for which you print delivery notes.
Order Type	Enter a value that exists in the Document Type (00/DT) UDC table to specify the type of document for which you set up the numbering scheme.
Same-As Document Type	Enter a value that exists in the Document Type (00/DT) UDC table to specify the type of document for which the system uses the same numbering scheme as the document that you specified in the Order Type field.
Next Number Range 1	Enter the first number of the numbering scheme.

Entering Address Book Information for a Tax Reporting Entity

This section provides an overview of additional address book information and discusses how to enter additional address book information.

Understanding Additional Address Book Information

You use the Address Book Additional Information - Italy program (P74Y0101) to enter additional address book information about the reporting entity for the Italy Annual Customer and Supplier list. If the reporting entity is a natural person, you enter the gender of the person and information about date and place of birth. If the reporting entity is not a natural person, you enter information about the location of the entity.

The system enables access to the Address Book Additional Information - Italy program only when you select an address book record for which the Search Type code is O (company). The system enables or disables the Personal and Company tabs in the Address Book Additional Information - Italy program based on whether the Codice Fiscale (tax ID) for the company is in the format for an individual or for a legal entity. If the Codice Fiscale is for an individual, the system enables the Personal tab on the Address Book Additional Information - Italy form. If the Codice Fiscale is for a legal entity, the system enables the Company tab on the Address Book Additional Information - Italy form.

Prerequisite

Before you complete the task in this section, verify that the Localization Country Code field in your user profile is set to IT (Italy).

Forms Used to Enter Additional Address Book Information

Entering Additional Address Book Information

Access the Address Book Additional Information - Italy form.

Personal

Company

Setting Up the Data Dictionary for Withholding in Italy

When you process withholding tax, the system uses the data item IRSA (Withholding Tax Status) to track the status of the tax.

These values are hard-coded for the data item IRSA:

• 0: Voucher entered with withholding tax information.

• 1: Payment for voucher entered (debt to fiscal authority).

• 2: Withholding tax paid to fiscal authority.

• 9: Withholding tax canceled.

In addition, you can set up another user-defined value to indicate that a Withholding Tax Certification report has been generated for the tax.

Setting Up the 30/60/90 End-of-Month Invoice Date for Italy

In this example, a payment is split into three installments. The first installment is due 30 days after the end of the month of the invoice date. The second installment is due after 60 days, and the third installment is due after 90 days. No matter what the day of the month when the invoice was created, the due dates are always calculated from the end of that month.

To pay the invoice in this example, you must set up an installment payment term that is based on three equal payments. To determine the due dates of the payments, you must first set up the date range to calculate the end of the month of the invoice date. You then set up the first installment to be due 30 days after the calculated end of the month, the second installment to be due 30 days after the first installment, and the third installment to be due 30 days after that installment.

You set up due date rules for the 30/60/90 end-of-month invoice date as shown in the examples:

End of Month Rule Part 1

End of Month Rule Part 1 calculates the invoice date.

From the Due Date Rules Revision form:

Date Range for End of Month Rule Part 1

The system calculates the end of the month for the invoice date from the date range.

From the Date Range Revision form:

End of Month Rule Part 2

End of Month Rule Part 2 calculates a due date 30 days after the previous due date.

Example: Advanced Payment Terms

This example shows how to set up the end-of-month payment term:

Example: Installments

This example shows how to set up the installment payments for the end-of-month payment term:

Setting Up Payment Formats for Italy

This section provides an overview of payment formats for Italy and discusses how to set up processing options for:

• Create A/P Bank Tape - Italy (R04572I1).

• Print Automatic Payment - Check - Italy (R04572I2).

Understanding Payment Formats for Italy

JD Edwards EnterpriseOne software provides these payment formats for Italy:

Understanding Payments with IBAN in Italy

When you use the JD Edwards EnterpriseOne automatic payment process for Italy, the system generates a flat file that you send to your bank and a letter that you send to your supplier. The payment formats include records 16 and 17 in the flat file, which include the IBAN for the payee and the payor. The letter that you send to your supplier was also includes the IBAN for both the payee and payor.

When you run the Write process in the automatic payment process, the system runs the Create A/P Bank Tape - Italy program (R04572I1) if you specified this program as the payment print program. The system:

• Prints the payment records, including the IBAN for the company's bank account and the supplier's bank account, to the A/P Payment Tape table (F04572OW).

• Prints a letter that includes the IBAN for the company's bank account and the supplier's bank account that you can send to your supplier.

• Prints a report that shows the records processed.

  The report includes a warning message if the company or supplier bank account records do not have an IBAN.

When you run the Update process in the automatic payment process, the system runs the A/P Auto Payment Register - Italy program (R04576I) to generate a PDF report showing the records that were processed. The PDF report shows the IBAN of the company's and supplier's bank account record.

Setup for Automatic Payment Processing with IBAN

Before you run the automatic payment process for Italian payments:

• Verify that the IBAN is included in the bank record for the bank that you use to make the payment.

  See Setting Up GL Bank Accounts.

• Verify that the IBAN is included in the bank record for your supplier's bank.

  See Setting Up Supplier Bank Accounts.

• Set up the processing options for the Create A/P Bank Tape - Italy program.

  See Setting Processing Options for Create A/P Bank Tape - Italy (R04572I1).

• Specify the Create A/P Bank Tape - Italy program as the payment print program.

  You can set up the print program as a default value in the Payment Instrument Defaults program (P0417) or by using a menu option (Row menu, Controls) in the Work with Payment Groups program (P04571).

• Specify the A/P Auto Payment Register - Italy program as the payment register program in the Payment Instrument Defaults program.

Setting Processing Options for Create A/P Bank Tape - Italy (R04572I1)

Processing options enable you to specify the default processing for programs and reports.

Date

Tape

Tape (more)

Currency

Setting Processing Options for Print Automatic Payments - Check - Italy (R04572I2)

Processing options enable you to specify the default processing for programs and reports.

Translation

Address

Print

Setting Up Draft Remittance Formats for Italy

This section provides an overview of draft remittance for Italy and discusses how to:

• Set processing options for A/R Magnetic RIBA Draft Remittance Tape Format (R03B672IT).

• Set processing options for A/R Magnetic RID Draft Remittance Tape Format (R03B672IR).

Understanding Italian Draft Remittance Formats

The JD Edwards EnterpriseOne system provides several country-specific formats for electronic accounts receivable drafts remittance. You specify the country-specific format that you want to use on the Paper/Tape tab of the processing options for the Draft Remittance program (R03B672).

Specify one of these formats for electronic accounts receivable drafts remittance for Italy:

When you use the magnetic RIBA and RID remittance formats, the system creates text file processor batches that contain the remittance information.

Setting Processing Options for A/R Magnetic RIBA Draft Remittance Tape Format (R03B672IT)

Processing options enable you to specify the default processing for programs and reports.

Bank

Italian Tape

Create

Setting Processing Options for A/R Magnetic RID Draft Remittance Tape Format (R03B672IR)

Processing options enable you to specify the default processing for programs and reports.

Tape

Create

Setting Up Supplier Withholding Tax Information for Italy

This section provides an overview of supplier withholding tax information for Italy and discusses how to set up supplier withholding tax information for Italy.

Understanding Supplier Withholding Tax Information for Italy

Businesses in Italy are required to set up this information about any suppliers who are subject to withholding tax:

• Fiscal group code

• Withholding tax code

• Individual tax identification number

• Country

You are required to include this information in your withholding tax reports.

When you set up withholding tax information for your suppliers, you associate suppliers with specific withholding tax rates. When you enter vouchers for your suppliers, the system uses this default rate to calculate the withholding tax amounts. You can override default supplier information, if necessary.

The system displays the individual tax identification number and country of the supplier, based on the supplier's record in the F0101 table.

Forms Used to Set Up Supplier Withholding Tax Information

Setting Up Supplier Withholding Tax Information

Access the Supplier Master Additional Information - Italy form.

Individual	Enter Y to indicate that the supplier is an individual. Enter N to indicate that the supplier is not an individual.
Gender	Specify the gender when the supplier is an individual. Values are: M: Male F: Female
Date of Birth	Enter the individual's date of birth.
Place of Birth	Enter the place of birth of the individual.
Province of Birth	Enter the province of the place of birth of the individual.
Fiscal Group Code	Enter a value that exists in the Form 770 Information (74/70) UDC table to specify the fiscal group to which a company belongs. For example, you could assign code 0A to suppliers that reside in Italy whose income is completely subject to the INPS withholding tax. Values are: 0: Resident. 0A: Resident whose income is all subject to INPS. 0B: Resident whose income is partially subject to INPS. 0C: Resident whose income is not subject to INPS. 1: Nonresident whose income is all subject to INPS. 1A: Nonresident whose income is partially subject to INPS. 1B: Nonresident whose income is not subject to INPS. 1C: Nonresident.
W/T Code - Internal (withholding tax code - internal)	Define withholding tax rates with the Withholding Tax Codes - Italy program (P740405). The system uses this information to calculate withholding tax when you enter supplier vouchers for suppliers that are subject to withholding tax. When you set up this internal withholding tax code, you establish links between: The withholding tax percentage. The percentage of the base amount that is subject to withholding tax. The type of withholding tax. The user-defined codes for Model 770 reporting. The withholding tax fiscal codes.
Add'l Ind Tax ID (additional individual tax ID)	Enter the identification number assigned by a tax authority to an individual, in addition to the primary Tax ID number (TX1).

Setting Up Withholding Tax Codes

This section provides an overview of withholding tax codes for Italy, lists a prerequisite, and discusses how to set up withholding tax codes for Italy.

Understanding Withholding Tax Codes

If your suppliers are subject to withholding tax, define withholding tax rates so that the system can calculate the withholding tax when you enter supplier vouchers. To do this task, you set up withholding tax codes.

When you set up codes for withholding tax, you specify, among other parameters, the withholding tax type, the percentage, and the base of computation for the tax. For example, the type of withholding tax to which a supplier is subject is Ritenuta d'acconto imposta. Based on this type of withholding tax, vouchers for the supplier are subject to a withholding tax rate that is 20 percent of the total taxable amount.

You can also establish links between different withholding taxes and the codes that you set up for Model 770 reporting.

Prerequisite

Set up the codes for Model 770 reporting in the Section of 770 Form (74/RA) UDC table.

Forms Used to Set Up Withholding Tax Codes

Setting Up Withholding Tax Codes

Access the Withholding Tax Codes Revision - Italy form.

Withholding Tax Code	Enter a tax code that exists in the F740405 table to define the withholding tax rate. The system uses this information to calculate withholding tax when you enter supplier vouchers for suppliers that are subject to withholding tax. When you set up this internal withholding tax code, you establish links between: The withholding tax percentage. The percentage of the base amount that is subject to withholding tax. The type of withholding tax. The user-defined codes for Model 770 reporting. The withholding tax fiscal codes.
W/T Code - Fiscal (withholding tax code - fiscal)	Enter a code from the Withholding Tax Fiscal Code UDC table (74/WF) that is assigned by the government for printing on official forms.
Basis Percentage	Enter the percentage of the base invoice or voucher amount that is subject to withholding tax.
Withholding Tax Percentage	Enter the withholding tax percent or rate.
Section of 770 Form	Enter a code from the Section of 770 Form (74/RA) UDC table. You must complete this field when you define a new withholding tax code.
Withholding Type	Enter a code from the Withholding Type (74/WT) UDC table that specifies the type of withholding tax. The system uses the withholding type to distinguish between different types of withholding tax for reporting and processing purposes. In Italy, there are different types of withholding tax on supplier's vouchers, such as standard withholding and INPS withholding. You link a withholding type to each internal withholding tax code that you define on the Withholding Tax Codes - Italy program (P740405).
Include in Balance	Enter whether to bypass the balance control when you enter a code for INPS withholding tax on the Withholding Tax Codes Revision form (W740405B). The balance control calculation for withholding tax entries is: gross amount (the amount not subject to withholding tax) plus the amount subject to withholding tax, plus the VAT amount. Values are: 0: Amount excluded from balance 1: Amount included in balance

Setting Up Register Types and Classes for Summary VAT

This section provides an overview of register types and classes and discusses how to link register types, register classes, and document types.

Understanding Register Types and Classes

To report on summarized VAT, you must set up register types and classes to track and report VAT tax in a summarized format. You then create a link between the register types and classes, and the appropriate type of transaction (document type). You use the Register Type & Class Setup (P74091) program to create the links.

You specify different register classes for sales and purchases. Register types are subsets of register classes. For example, the register types for a sales register class might include:

• Sales within Italy

• Sales within the EU

• Sales outside the EU

When you link register types and classes to document types, you establish and maintain the relationships among document types, VAT rates, register types, and classes. You can use these relationships to create summarized VAT reports.

Form Used to Link Register Types, Classes, and Document Types

Linking Register Types, Classes, and Document Types

Access the Class/Register Type Revision form.

Document Type	Enter a user-defined code (00/DT) that identifies the origin and purpose of the transaction. The system reserves several prefixes for document types, such as vouchers, invoices, receipts, and time sheets.
IVA Rate	Enter a code that identifies a tax or geographic area that has common tax rates and tax authorities. The system validates the code you enter against the F4008. The system uses the tax rate/area in conjunction with the tax explanation code and tax rules to calculate tax and GL distribution amounts when you create an invoice or voucher.
Registration Class	Enter a code that represents the class of VAT register. You define the valid codes for VAT register classes in the VAT Register Class UDC table (74/01). For example, you might set up a register class for purchases and one for sales. You link document types, tax rates, register types, and register classes on the Register Type and Class Setup form to meet the reporting requirements. Then, you can run the Summary VAT Report (P74093) to print the VAT information based the register classes and types you link to various document types. You can group and classify transactions for reporting purposes by defining register classes and types in conjunction. For example, you might set up register types and classes as: Register Class: Sales. Register Type A: VAT on Sales, Italy rate 19 percent. Register Type B: VAT on Sales, out of EU, not subject to VAT (art. 8/A).
Register Type	Enter a code that represents the type of VAT register. You define the valid codes for VAT register types in the VAT Register Type UDC table (74/02). For example, you might set up a register type for transactions that are eligible for VAT and another for transactions that are not eligible for VAT. You link document types, tax rates, register types and register classes on the Register Type and Class Setup form to meet the reporting requirements. Then, you can run the Summary VAT Report (P74093) to print the VAT information based the register classes and types you link to various document types. You can group and classify transactions for reporting purposes by defining register classes and types in conjunction. For example, you might set up register types and classes as: Register Class: Sales. Register Type A: VAT on Sales, Italy rate 19 percent. Register Type B: VAT on Sales, out of EU, not subject to VAT (art. 8/A).

Establishing an Initial VAT Balance

This section discusses how to establish an initial VAT balance.

You can use the VAT Balances Revisions (P74092) program to establish an initial VAT balance, or to review and revise the VAT balances that print on the summarized VAT report.

Form Used to Establish an Initial VAT Balance

Establishing an Initial VAT Balance

Access the IVA Balances History Revision - Italy form.

Company	Enter a code that identifies a specific organization, fund, or other reporting entity. The company code must already exist in the Company Constants table F0010 and must identify a reporting entity that has a complete balance sheet. At this level, you can have intercompany transactions. Note. You can use company 00000 for default values such as dates and automatic accounting instructions. You cannot use company 00000 for transaction entries.
Balance Date	Enter the date is associated with a VAT balance for the Summary VAT Process. It can be revised in the VAT Balances Revisions screen (P74092). The print program P74093 searches the VAT balance file by this date.
Credit Balance and Debit Balance	Enter the current VAT credit amount or VAT debit amount. The VAT credit balance, and VAT debit balance, is maintained in the VAT Balances Revisions program (P74092) and is used by the Print VAT Summary Reports program (P74093).

Setting Up Corresponding Versions

Some country-specific functionality requires that you create versions of the same name for a country-specific program and a base software program. For example, to have the system access the processing options for a country-specific voucher program, you might need to set up a version named XYZ for the country-specific voucher program, and a version named XYZ of the Standard Voucher Entry (P0411) program.

Set up corresponding versions for these programs: