VAT Exempt Transactions

In situations in which items or invoices are not subject to VAT, you can either set up the item as exempt or set up a print message to print an explanation of why the transaction is exempt from VAT.

Use the Sales Taxable field on the Item/Branch Plant Info form of the Item/Branch Plant program (P41026) to specify whether VAT applies to an item. If you enter N in this field, the system prints the word EXEMPT for the item in the detail section of the VAT reports.

When printing invoices from the JD Edwards EnterpriseOne Accounts Receivable system, you must identify exempt lines in the invoice by using a tax explanation code of E (exempt). When a line has a tax explanation code of E, the system prints the word EXEMPT for the line in the VAT reports.

Exempt invoice corrections printed from the JD Edwards EnterpriseOne Sales Order Management and the JD Edwards EnterpriseOne Accounts Receivable systems are also printed to the VAT reports when set up as exempt transactions.

Exempt transactions and zero-rate transactions are shown in different tax groups in the summary section of the VAT reports.