VAT setup

Dear Experts, I need your help of VAT setup,

[mention:de4f7bb6efd24d1b9db4424f7336ddf8:e9ed411860ed4f2ba0265705b8793d05] [mention:2abfccb16103443eb4d898278dc18d12:e9ed411860ed4f2ba0265705b8793d05] [mention:404c8136e95b4dd196432e94423230e8:e9ed411860ed4f2ba0265705b8793d05]

The system now calculation the VAT wrongly, but a few days ago it was calculation fine, this is the example screenshots from Payment Journal.

The VAT rate is 5%

This is the correct calculation Amount 243.60 * 5% the VAT amount is 12.18

Now I am doing exactly the same entry with the same amount but the system did this formula Amount ÷ 1.05 * 5%


232 * 5% VAT = 11.60

This is the screenshot

for posted entries above can i see amount for balancing account (bank account)? it seems that 255.78 could have been paid for the bill.

Yes [mention:404c8136e95b4dd196432e94423230e8:e9ed411860ed4f2ba0265705b8793d05] This is a payment for Elect. bill, I am wondering when I tried to do the same the system, not calc. the correct VAT amount.

The system is doing that now in all journals take the amount 1000 divide by 1.05 take the result 952.39 multiply 5% the result 47.62

not sure if i am understanding the issue correctly. If the payment of 255.78 was made in first instance then what is the problem here? Calculations are correct

Yes the first is correct, the second incorrect

in the second you need to enter the same amount as 255.78 if you want to pay the same amount

Oops, this is solved the problem, this is means in the Gen. Journals we need to enter the Amount incl. VAT.

Thanks so much, brother Imran. I tested and working fine


How did you it solve it? I thought the system should calculate the VAT automatically when you enter only the amount? Now what you said is that one has to compute the VAT, maybe by head and add it to the amount and you enter that whole amount, eight?

Hi, [mention:39889570bef24a73b76cfec390ebf185:e9ed411860ed4f2ba0265705b8793d05]

You need first to know the following:

  1. The VAT calc. in Documents (Purch. & Sales) can be:
    • Amount Incl. VAT
    • Amount Excl. VAT

You can Enable/Disable that in the Customer/Vendor Card the Field Prices including VAT, then you have the choice.

2. The VAT in the Journals (Gen. Purch. Sales & Payment) you have only to fill the Amount Incl. VAT and the system will take the amount and do this formula

Amount incl VAT/1.VAT rate = Amount Excl VAT

then Calc. the VAT by Amount Excl. VAT * VAT Rare = VAT amount.