Nonreimbursable VAT Processing for Peru

According to VAT law provisions, fiscal credit can be taken only within the four tax periods following the invoice issue date, provided that VAT reimbursability validation is defined in the Company Constants by months or days.

You must set up:

• Legal Company Constants.

  Set up the quantity of days and months for the VAT reimbursability and the date to be used to verify days and months.

• Tax area equivalence.

  Specify which is the tax area with equivalent nonreimbursable fiscal credit for each fiscal credit of tax area.

• Tax rate/area.

  Set up the tax area to use to enter the fiscal credit.

If the difference of days or months in a voucher is greater than the date specified in the Company Constants (nonreimbursable VAT), the system automatically modifies the tax area and the tax explanation code so that they are recorded as nonreimbursable taxes.

For each voucher line, the entered tax area is replaced by its correlative area stated in the tax area constants when these conditions apply:

• Invoice date exceeding the legal time.

• Tax type equal to VAT.

• Tax percentage in the tax area different from 0.

Typically, you should use an explanation code S for the nonreimbursable VAT because this code does not discriminate tax. You can also enter vouchers with a tax explanation code and a nonreimbursable tax area code without the automatic system change option.