The amount of VAT invoiced during an asset purchase can be totally or partially collected by the company, depending on the position of the company concerning fiscal rules.
The collected VAT is determined: - upon creation of an asset by expense capitalization from the VAT of the attached expenses, - upon creation of an asset separated from expenses, based on the deduction coefficient applied.
Note: The deduction right and the applying adjustments concern all the liabilities (total or partial liabilities). They are calculated using a deduction coefficient which must be assigned even if the company has total liabilities. The coefficient is equal to the multiplication of the 3 following coefficients (rounded with 2 decimals higher):
1/ The liability coefficient. It reflects the proportion of use of the asset for taxable operations.
2/ The taxation coefficient This reflects the principle according to which, regarding taxable operations, only the tax on assets or services used for operations to have deduction right can be deduced. Its value is defined for the activity sector to which the asset is assigned. It can be fixed as soon as the asset is used to perform taxable operations giving deduction right and taxable operations not giving deduction right, no matter if the asset is also used to perform non-taxable operations. In this case, it corresponds to the usual "deduction prorata" as defined in the previous requirements relating to the VAT adjustment.
3/ The admission coefficient This reflects the maximum tax proportion authorized for a liable to deduce from an expense.
The initial deduction right can be compromised via various adjustments applied to the asset. There are two types of adjustments:
This function is used to process global VAT adjustments. These processes can be used for any French company in order to process adjustments following events that compromise the deduction right. Theses adjustments correspond to the total of annual adjustments that should intervene until the term of the adjustment period if the situation, as it is following the specific event, remains as such until the end.
These processes should be done before the VAT annual adjustment. Modifications following these global adjustments apply to the future reference coefficients. Therefore, they are not taken into account for the calculation of the annual adjustment for the year with theses global adjustments. They are taken into account: --> during the calculation of annual adjustment starting from the following year --> later, during the calculation of global adjustments, including those of the current year.
Events that trigger a global adjustment:
Modification of laws or rules concerning exclusion rules for deduction right. This is the process concerning the Modification of reference admission coefficient.
Assets that become used for processing operations that open rights to deduction
Assets not used, definitely or not, for processing operations that grant rights to deduction This is the process concerning the Modification of reference taxation coefficient.
Only the following assets are taken into account by the process: - those whose residual adjustment duration is longer than or equal to 0, - asset for which the holding type is set to In property or In concession, - asset for which the CoA or IFRS accounting nature is Fixed asset in service; it can also be assets whose nature is Fixed asset in process if the REGENCOURSFixed asset in process : VAT adjust. ? adj is set to Yes. - asset which has not been subject to an actual issue, - asset which has not been subject to VAT annual adjustment, - which subjection coefficient is different than 0. The mixed-use assets (assigned on several activity sectors), whose taxation coefficient is forced, are also excluded from the adjustment process concerning the modification of the taxation coefficient.
Reminder: the period over which a VAT adjustment can be recorded, is automatically determined according to the Tax type and the VAT adjustment reference date (generally speaking, the date of the asset purchase). Regarding assets for which the Tax type is Asset liable for property tax acquired from 01/01/1996, the adjustment period is 20 years. In other cases, the adjustment period is 5 years.
Other global adjustment processes are done automatically at the end of the implementation of the following events:
Cession or contribution of an asset submitted - or not submitted - to the VAT on total price
Transfer of an asset between different activity sectors.
a header that is used to specify the process options and to choose the company well as the sites to which the assets to be processed belong,
the Action setup tab which is used to specify the type of event that justifies the adjustment,
the Extended selection tab that is used to select the assets to be processed. This tab is used only for the global adjustment which is linked to the modification of the admission coefficient.
Management method for the window
The management is the same for this window as for all the mass process functions that can be applied to assets.
Adjustment process setup
First, it is necessary to set up the processing or to recall, using the button button, an existing setup previously saved under a Memo code.
The setup of the processing consists in:
- Entering the processing options. By default, the process is carried out in Simulation and generates a Detailedlog file which displays, if applicable, the value of selection criteria, the various parameters applied during the execution of the processes and, for each updated asset: the value of the old and new coefficients, the amount of the invoiced VAT, the reminder of the period and residual duration of the adjustment, the adjustment amount and the balance sheet value.
- Selecting the company, as well as any sites that reference the assets.
- Entering the parameters linked to the global adjustment.
- Carrying out, for the admission coefficient modification processing, a selection of the assets concerned by the processing.
Note: when the setup of a processing is completed, it is possible to save it under an identification code using the button . It is then possible to recall it at a later date for use in an adjustment.
Launch of the adjustment process
Once the setup is done, it is possible to:
Either directly apply the entered parameters to each of the selected assets, by clicking on . A consistency control for the new value is carried out; if there is an error, an error message is inserted in the log file report.
Or go through an intermediate control stage of the entered parameters by clicking the .
A window displays a grid with the list of selected assets impacted by the process; it displays, for each of them, the new values for the coefficients.
Any modification must be confirmed by using the button . To cancel the modifications under way on the asset, click on . Click the button button, to close the control window; the setup entry window is displayed again, which makes it possible to either confirm the mass update by clicking on , or to abort the update by clicking the button .
Header
The header contains the process options and is used to select the company or companies as well as the site(s) that reference the assets to be processed.
Field descriptions
Options
Simulation (field FLGSIM)
This check box is selected by default and runs the closing in simulation mode. In this case, controls and the process are carried out but there are no updates recorded in the database.
Clear this check box to run in actual mode. In this case, you cannot reverse the closing and updates are recorded in the database. If you are using intermediate commits, it is recommended that the NIVTRACE – Log file level parameter (AAS chapter, MIS group) value is 0.
Report (field FLGETA)
This indicator can be accessed only when one or several reports are linked to the massive process. In this case, the activation of this indicator enables the user to print these reports.
Detailed log file (field FLGDET)
A log file is automatically displayed on process completion, showing the processing parameters. A Statistics section gives the number of selected assets, the number of assets updated as well as the number of assets not processed due to an error. Assets with errors are listed with their error reason.
When this box is ticked, the log file is displayed in the form of a detailed report presenting, in addition to the information listed above, the list of assets successfully processed.
The viewing and printing of log files are possible at any time via the report code ATRACE - Print log file print request, obtained from the Supervisor function in the Print/Group print menu.
Help common to all the mass processings. The grid displays the list of the managed companies for which the user is authorized. Check a box to select the company which must be processed. After selecting a company, all the financial sites that are linked to it are selected by default. You can selectively de-select those that are not concerned by the processing. You can also select directly the site(s) to be processed. In that case, the company to which they are attached is automatically selected.
When the company setupACCPERCTL - Control of accounting periods (chapter AAS, group CPT) has the value 'Yes', the company is not displayed in the list if at least one of its contexts is not synchronized with the accounting period/fiscal breakdown. The desynchronization status of a context is visible in the screenDetailed status of contexts that can be accessed from the Actions icon.In that screen, on the Calculation tab, the field Modification type has the value 'CNX' and the field Modified parameter has the value 'DESYNC'.In this case, it is necessary to launch the processing of Contexts synchronization.
The grid displays the list of the sites attached to the companies and for which the user has authorizations. Check this box for the site to be taken into account in the processing. After selecting a company, all the financial sites that are linked to it are selected by default. You can selectively de-select those that are not concerned by the processing.
Simulation: This box, ticked by default, is used to carry out a simulation of the adjustment process for the selected assets. The modification of the assets is not recorded in the database.
The impact of the processing on the assets can be viewed in the log file displayed at processing completion.
Detailed log file: A log file is systematically displayed on completing the process, showing the selection criteria and the parameters applied during this process. A Statistics section gives the number of selected assets, the number of assets updated as well as the number of assets not processed.
When this box is checked, the log file is displayed as a detailed report with the information listed before and for each updated asset: the value of the old and new coefficients, the amount of the invoiced VAT, the reminder of the period and residual duration of the adjustment, the adjustment amount and the balance sheet value.
Note: the viewing and printing of the log files is possible at any time via the Print log file print request of the ATRACE report code, obtained from the Supervisor function in the Print/Group print menu.
Company selection – Site selection
These tables display both the list of managed companies for which the user is authorized and the list of financial sites linked to these companies where the user is authorized.
When the company setupACCPERCTL - Control of accounting periods (chapter AAS, group CPT) has Yes for value, the company is not displayed in the list as soon as at least of one its context is not synchronized with the accounting period/fiscal breakdown. It is then necessary to launch the Context synchronization process. The situation of desynchronization of a context can be viewed on the Detailed status of contexts,Calculation tab (the value of the Modification type field is CNX and the value of the field Modified parameter is DESYNC).
It is necessary to select the company and the sites involved in the process. After selecting the company, all sites of the companies are selected by default. The user can deselect those that are not concerned by the processing. Provided they belong to the same company, the site(s) involved in the processing can be directly selected, in which case the company to which they belong is automatically selected.
Reminder: the assets MUST be registered in sites attached to the same company. Selecting a second company, or sites linked to another company, leads to the de-selection of the first company selected, after validation of a confirmation message.
Tab Action Parameters
This tab is used to specify the type of event from which the adjustment process to carry out comes from. It can be exclusively:
Either a legislative modification of exclusion rules to deduction right which is materialized by the modification of the admission coefficient for assets that correspond to the criteria entered in the Extended selection tab. The new value of the coefficient should be entered.
Or assets that become used for processing operations that open rights to deduction These are assets assigned to an activity sector for which the provisional taxation coefficient is 0 and to which the process will apply the new taxation coefficient entered as a setup.
Or assets not used anymore for processing operations that open rights to deduction These are assets assigned to an activity sector for which the provisional taxation coefficient is different than 0 and to which the process will apply a new taxation coefficient equal to 0.
Or assets that will never be used again for processing operations that open rights to deduction These are assets assigned to an activity sector for which the provisional taxation coefficient is equal to 0 and to which the process will apply a new subjection coefficient equal to 0.
Field descriptions
Block number 1
Adjustment date (field MVTDAT)
This field can not be entered by the user. It displays the current date.
Block number 2
field VATADM
This checkbox must be selected when the VAT adjustment processing concerns the legislative modification of the deduction right exclusion rules. It is then necessary to indicate in the following field the new admission coefficient value.
field FLDA
Block number 3
Admission coef. (field ADMCOE)
This field is used to specify the new admission coefficient value. It can only be entered when the VAT adjustment processing concerns the legislative modification of the deduction right exclusion rules.
field FLDE
Block number 4
field VATOPN
This checkbox must be selected when the VAT adjustment processing concerns assets that become used for processing operations that open rights to deduction. It is then mandatory to indicate in the following fields:
The VAT sector to which are assigned the concerned assets can only be an activity sector for which the provisional coefficient is equal to 0.
The new taxation coefficient value: this value must mandatorily be different than 0.
field FLDB
field VATCLS
This checkbox must be selected when the VAT adjustment processing concerns assets that are no longer used for processing operations that open rights to deduction. It is then mandatory to indicate, in the following field, the VAT sector to which are assigned the concerned assets; only an activity sector with a provisional coefficient different than 0 can be selected.
field FLDC
field VATDEF
This checkbox must be selected when the VAT adjustment processing concerns assets that will never be used again for processing operations that open rights to deduction. This processing is used to apply a future liability coefficient equal to 0 to all the assets linked to an activity sector for which the provisional taxation coefficient has the value 0.
It is then mandatory to indicate, in the following field, the VAT sector to which are assigned the concerned assets; only an activity sector with a provisional coefficient equal to 0 can be selected.
field FLDD
Block number 5
VAT segment (field AASBUS)
This field is used to precise the VAT sector to which are associated the assets concerned with the processing. The validity of the selected sector is a function of the requested processing:
For the assets used, only one sector for which the temporary taxation coefficient is equal to 0 can be entered.
For the assets no longer used, only one sector for which the temporary taxation coefficient different from 0 can be entered.
For the assets permanently no longer used, only one sector for which the temporary taxation coefficient is equal to 0 can be entered.
field SACDES
Taxation coeff (field TAXCOE)
This field can only be entered in the case of a processing regarding used assets. It is used to enter the temporary tax coefficient that will be assigned to them at the end of the processing.
Tab Extended selection
This tab is used to enter the asset selection criteria.
It contains five lines, each of them used to enter a criterion, with each criterion being linked to the next one by one of the following logical operators: And, Or.
The process for selection criteria entry is as follows:
1/ Enter, or select from the list obtained by a right click the field in the asset table FXDASSETS which contains the information to which the selection is applied.
2/ Then select the operator: Any, Equal, Different, Greater than or equal, Less than, Lessthan or equal, Like. The Like operator is valid only for numeric fields. It makes it possible to use wild card characters.
3/ Enter a value. The list of possible values for the chosen field can be obtained with a right click when these values are contained in a local menu or in a table (miscellaneous table, common table, accounting table, etc.).
The user can also:
- enter the criteria in the form of an Adonix expression; the formulas of this type can be entered by right-clicking the fields in the asset table FXDASSETS,
- enter a selection formula by calling the formula editor.
Reminder: The selection options are the same as those used in the standard Advanced selection function. For more information, see the documentation on ADONIX object ergonomics.
Field descriptions
Block number 1
Fields (field FLD)
Use the look-up icon to select a field from the Fixed assets table.
Memo (field PAR)
Select this checkbox to save this search option.
Block number 2
Expression (field EXP1)
Use this field to enter an expression for the selection criteria.
This criterion is added to the previous criteria by the link AND.
The expression cannot contain fields from a table other than the Fixed assets table. These can be indexed.
Memo (field PAREXP)
Select this checkbox to save this search option.
Admission coefficient modification process
The VAT adjustment linked to the modification of the admission coefficient triggers the following operation, for each asset: Adjustment amount: It corresponds to: (Deduction coefficient due to the event - Reference deduction coefficient*) x (initial VAT / Duration of the adjustment period) x Adjustment residual duration * This is the future reference coefficient before the adjustment.
The year of the event is not counted in the adjustment residual duration.
This adjustment consists in: --> An additional additional VAT deductiondeduction if the result of the calculation is positive. --> A VAT repayment if the result of the calculation is negative.
At the end of the process, the information concerning this type of adjustment are updated in the Fixed assets function:
--> On the VAT tab:
- Load of the Additional deduction amount or of the Repayment amount, depending on cases. - The new admission coefficient loads the Future reference admission coefficient section. - Activation of the indicator signaling that a global adjustment was carried out. - The Adjustments history is updated.
--> On the Depreciation plan:
If the setup REGMAJBAS - VAT variation base update is set to Yes, the tax repayments and additional deductions are saved upon modifying the entry cost and update the balance sheet value. No depreciation method change is applied. The depreciation variance is adjusted on the last depreciation fiscal year.
The annual reference admission coefficient and the one in use are loaded with the new admission coefficient (which has become the future admission coefficient) during the closing process.
An event of VAT adjustment – Assets (FASVATREG) is generated on the accounting plan (and if needed on the IAS/IFRS plan) to enable the posting of the repayment or additional deduction of VAT.
Additional deduction amount (0,65 - 0) x (1 960 € / 5) x 2 = 509,60 €
Taxation coefficient modification process
This process is for all assets assigned to an activity sector (except for mixed asset, that is to say, assets which taxation coefficient has been forced). It should be carried out in the following cases:
1/The assets are used in order to perform operations that open right to deduction (until now, they were used, entirely or partially, for taxable operation that did not open rights to deduction). These assets are: --> a reference subjection coefficient different than 0 --> a reference taxation coefficient equal to 0 This adjustment leads to the modification of the reference taxation coefficient which acquires the new use value. The reference subjection and admission coefficient remain unchanged. This event does not imply the reset of the adjustment duration counter.
Adjustment amount: It corresponds to: (Deduction coefficient due to the event - Reference deduction coefficient*) x (initial VAT / Duration of the adjustment period) x Adjustment residual duration * This is the future reference coefficient before the adjustment.
The year of the event is not counted in the adjustment residual duration.
This adjustment is a VAT additional deduction.
At the end of the process, the information concerning this type of adjustment are updated in the Fixed assets function:
--> On the VAT tab:
- Loading of the Additional deduction amount. - The new taxation coefficient loads the Future reference taxation coefficient section. - The flag for a global adjustment is set to Yes. - The Adjustments history is updated.
--> On the Depreciation plan:
If the setup REGMAJBAS - VAT variation base update is set to Yes, the additional deductions are saved upon modifying the entry cost and update the balance sheet value. No depreciation method change is applied. The depreciation variance is adjusted on the last depreciation fiscal year.
The reference taxation coefficient in use is loaded with the new taxation coefficient (that has become the future reference taxation coefficient) during the closing process.
An event of VAT adjustment – Assets (FASVATREG) is generated on the accounting plan (and if needed on the IAS/IFRS plan) to enable the posting of the repayment or additional deduction of VAT.
Global adjustment = additional deduction Additional deduction amount: (0,65 - 0) x (1 960 € / 5) x 2 = 509,60 €
2/The assets are not used anymore to perform operations that open right to deduction but are still used to perform taxable operations. These assets are: --> a reference subjection coefficient different than 0 --> a reference taxation coefficient different than 0 This adjustment leads to the modification of the reference taxation coefficient which becomes null. Their subjection coefficient remains unchanged which is not null The assets remain available for a new adjustment on the adjustment period that remains in case they might be used again, entirely or partially, for operations that grant deduction rights. This event does not imply the reset of the adjustment duration counter.
Adjustment amount: It corresponds to: (Deduction coefficient due to the event - Reference deduction coefficient*) x (initial VAT / Duration of the adjustment period) x Adjustment residual duration * This is the future reference coefficient before the adjustment.
The year of the event is not counted in the adjustment residual duration.
This adjustment is a VAT repayment.
At the end of the process, the information concerning this type of adjustment are updated in the Fixed assets function:
--> On the VAT tab:
- Loading of the Repayment amount. - The new taxation coefficient loads the Future reference taxation coefficient section. - The flag for a global adjustment is set to Yes at the taxation coefficient level - The Adjustments history is updated.
--> On the Depreciation plan:
If the setup REGMAJBAS - VAT variation base update is set to Yes, the repayments are saved upon modifying the entry cost and update the balance sheet value. No depreciation method change is applied. The depreciation variance is adjusted on the last depreciation fiscal year.
The reference taxation coefficient in use is loaded with the new taxation coefficient (that has become the future reference taxation coefficient) during the closing process.
In the Activity sectors table, the new taxation coefficient loads the Provisory taxation coefficient and Definitive taxation coefficient tables with the activation of the forcing code.
An event of VAT adjustment – Assets (FASVATREG) is generated on the accounting plan (and if needed on the IAS/IFRS plan) to enable the posting of the repayment or additional deduction of VAT.
Global adjustment = Repayment Repayment amount: (0 - 1) x (980 € / 5) x 2 = - 392 €
Future reference taxation coefficient: 0:
3/The assets are not used anymore to perform taxable operations. These assets are: --> a reference subjection coefficient different than 0 --> a provisory reference taxation coefficient equal to 0 This adjustment leads to the modification of the subjection coefficient which becomes null. No VAT adjustment can be noticed in that case. Assets definitely issue from the adjustment cycle.
At the end of the process, the information concerning this process are updated in the Fixed assets function:
--> On the VAT tab:
- The new subjection coefficient loads the Future reference subjection coefficient section. - The flag for a global adjustment is set to Yes at the liability coefficient level. - The Adjustments history is updated.
The reference subjection coefficient in use is loaded with the new subjection coefficient (that has become the future reference subjection coefficient) during the closing process.
In the Activity sectors table, the new subjection coefficient loads the Subjection coefficient field.
This button is used: - to apply the adjustment setup to the assets, - to display a control window which displays a grid with the list of selected assets impacted by the process; it displays, for each of them, the new values for the coefficients.
Click on to come back to the setup screen. Click on to validate the process.
Memo
Click this action to save the current settings to a Memo code to be reused later. The memo is linked to your user profile, not to the function or the screen.
The STD memo code is associated with the screen and is loaded immediately when you open the function.
For more information on the advanced use of the Memo action, refer to the documentation on the General ergonomics of SAFE X3 software.
Recall
Click this action to enter a Memo code to load the settings associated with the code.
These processes should be done before the VAT annual adjustment.
Other global adjustment processes are done automatically at the end of the implementation of the following events: