Understanding VAT Calculations

VAT calculations on expense reports occur when you:

  • Click the Calculator button (frequent user) or Calculate VAT button (occasional user).

  • Access the VAT Information for Expense [type] page.

  • Access the VAT Accounting Detail page.

  • Click the Save for Later button.

    VAT is calculated for each expense line where VAT was not previously calculated.

  • Click the Submit for Approval button.

    VAT is calculated for each expense line where VAT was not previously calculated.

You can manually enter a VAT amount in the Override VAT Amount field if the VAT amount shown in your receipt does not match the VAT amount calculated by PeopleSoft Expenses.

Managers and auditors can access the Expense Report - VAT Information (TE_SHEET_VAT_SUM) page to review a summary of VAT calculations. This page is not available when you create or edit an expense report and have not submitted it for approval.

This table is an example of VAT calculations:

Expense Line

VAT Code

Reimbursement Amount

1

10%

110 EUR

2

15%

230 EUR

3

20%

300 EUR

PeopleSoft Expenses always uses an Inclusive VAT calculation method. PeopleSoft Expenses subtracts any VAT amount calculated or entered from the reimbursement amount to obtain the VAT basis amount.

Using the expense line 2 from the previous example, you calculate the VAT basis amount as follows:

(VAT Basis Amount) = (Reimbursement Amt) / (1 + (VAT Code / 100))
(VAT Basis Amount) = (230 EUR) / (1 + (15/100)) = 200 EUR

If a receipt has a VAT amount of 35 EUR, enter 35 EUR in the VAT Override Amount field and click the Calculate button. The system recalculates the amounts as follows:

(VAT Basis Amount) = (Reimbursement Amt) − (VAT Override Amount)
VAT Basis Amount = (230 EUR) − (35 EUR) = 195 EUR

The VAT amount remains 35 EUR in this example.

The following table displays how all VAT amount fields are treated when you save for later or submit the expense report:

Expense Line

Reimbursement Amount

VAT Code

VAT Calculated Amount

VAT Override Amount

VAT Basis Amount

1

110 EUR

10%

10

-

100

2

230 EUR

15%

30

35

195

3

300 EUR

0%

-

-

300