Calculation of VAT

To calculate VAT, the percentages of energy related charges subject to standard rate VAT and reduced rate VAT must be determined. As these percentages vary from customer to customer and even from one bill to the next for the same customer, their calculation must take place at billing time and is handled by the following:

For calculation rule-based rates, the Apply VAT to Cross Referenced Charges business object (C1–ApplyVatToCrossRefCharge) is provided to calculate the percentages of energy related charges subject to standard rate and reduced rate VAT, taking into account de minimis and any VAT declaration that is in effect for the service type, account, and premise. The percentages can then be applied to the appropriate charges that are cross-referenced.