Oracle VAT Seminar Louise Dunbar Finance Division dunbarla@cardiff.ac.uk October 2010 Contents 1. Introduction to VAT 2. The University and VAT in Oracle 3. Purchasing in Oracle a. “VAT TREATMENT” field b. “PRIMARY INTENDED USE” field: Recoverable VAT c. European Suppliers and INTRASTAT 4. Income 5. VAT Rate change 4th January 2011 1. Introduction Value Added Tax (VAT) There are three rates of VAT The rates are: standard – currently 17.5% (20% from 4thJanuary 2011) reduced – 5% zero – 0% There are also some goods and services that are: exempt from VAT outside the scope of VAT Output / Input VAT 2. Cardiff University and VAT http://www.cf.ac.uk/fince/servicesstaff/corporatefinancialservices/vat_1/index.html Partial Exemption Teaching Income EXEMPT e.g. Tuition Fees, Short Courses, Conferences Income Research Income VATABLE e.g. Industry Funded Research NON-VATABLE e.g. Research Council Grants, Charity Funded Research Other Income VATABLE e.g. Services Rendered Contracts, Sale of Goods Industrial CASE Awards, Graduation NON-VATABLE e.g. Room hire, Donations, Structural funds Oracle Tax Engine The tax engine looks at The Supplier location & tax set up AND The Customer location & tax set up before determining the tax rate to apply which in Oracle becomes the “VAT Treatment” http://www.cf.ac.uk/fince/servicesstaff/corporatefinancialservices/vat_1/index.html “VAT GUIDANCE – purchasing in Oracle” 3a. Oracle and VAT – “VAT Treatment” field denotes treatments generating Zero Rating Certificates Used for books/public transport/printing where no certificate required Iprocurement Example Example 1 Booking a Hotel Room Logged in as the iprocurement Approver Finally – Approver can view the VAT element Example 2 – Equipment Zero Rating Input the relevant details and Add to Cart View Cart and Checkout Checkout By entering CU% in the VAT Treatment field “VAT treatment” fields 3b “The Primary Intended Use” field: when VAT is recoverable This field should NOT be used UNLESS you are instructed to do so by Finance or RACDV for a particular School/Division Activity Projects Set up Example 3 – VAT recoverable activity Finally – view the Recoverable VAT element 3c Purchasing from the European Community http://www.cf.ac.uk/fince/resources/VAT%20Guidance%20-%20Purchasing%20from%20the%20EU.pdf Country Code Country Code Country Code Austria AU Germany DE Neth’lands NL Belgium BE Greece GR Poland PL Bulgaria BG Hungary HU Portugal PT Cyprus CY Irish Republic IR Romania RO Czech Republic CZ Italy IT Slovakia SK Denmark DK Latvia LV Slovenia SI Estonia EE Lithuania LT Spain ES Finland FI Lux’bourg LU Sweden SE France FR Malta MT United Kingdom GB INTRASTAT SCHOOL ORDER NUMBER SUPPLIER NAME EU COUNTRY Have you supplied a Zero Rated Certificate with this order Nominal Ledger Code for Payment HMRC Commodity Code UK Trade Info : ICN Online Application Item Description for HMRC Verification of Commodity Code Weight of Goods (in Kgs) Total Cost of Order (estimate if invoice not yet received) Contact Details : Name Extension Number YES or NO (delete as appropriate) 4. Income Income Teaching Income EXEMPT e.g. Tuition Fees, Short Courses, Conferences Research Income VATABLE e.g. Industry Funded Research NON-VATABLE e.g. Research Council Grants, Charity Funded Research Other Income VATABLE e.g. Services Rendered Contracts, Sale of Goods Industrial CASE Awards, Graduation NON-VATABLE e.g. Room hire, Donations, Structural funds Sales Invoice Requests The following activities are subject to VAT at Standard Rate but are often incorrectly treated on the Invoice Request: 1. Graduation Ceremonies 2. Sponsorship Income, where sponsor is not simply donating money 3. Industrial CASE studentships 4. Services supplied to non-eligible bodies 5. Sale of second hand goods The following activities should be EXEMPT from VAT 1. Short Course or Conference Income 2. Request for Donation from a business Sales Invoices and the EC VAT increase 4th January 2011 20% Rate on all VAT invoices issued on or after 4th January 2011 AND issued within 14 days of the transaction. If the transaction was performed BEFORE 4th January 2011, VAT may be charged at 17.5%. Recommend: Purchasing - Place orders and receipt goods/services prior to 4th January 2011 Sales – Invoice clients prior to 4th January for work done to avoid queries 1. 2. email vat@cardiff.ac.uk with specific queries Review • • The University and VAT in Oracle Purchasing in Oracle – “VAT TREATMENT” field – “PRIMARY INTENDED USE” field – European Suppliers and INTRASTAT • Income • VAT Rate change 4th January 2011