Brexit for the UK

VAT management

This document details how to adapt the VAT set-up due to the end of the transition period for Brexit, December 31, 2020, from a UK perspective. It focuses on VAT management impacts.

The information here is specific to Sage X3 version 11 or 12. If you run another version, significant differences could occur in functionalities and you could have serious difficulties to submit your VAT returns in the Making Tax Digital (MTD) context.

Screenshots may be noticeably different depending on your product version and/or configuration.

Audience

This document is intended for advanced users or business partners who are familiar with the British VAT tax structure, as well as the VAT management rules in Sage X3. Certain areas require Sage X3 technical knowledge. If you are unsure, check with your administrator or business partner.

Find out more

Visit the online help for these principle functions related to this process:

  • Accounting codes (GESCAC): Used to define the set of VAT accounts that are associated with each tax rate.

  • Accounts (GESGAC): Used to define the accounts needed to manage the different ledgers of the company. For the accounts of the main general ledger, tax characteristics must be defined such as tax management and allocation rules, default tax code, etc.

  • BP tax rule (GESTVB): Used to define the tax rules associated with each business partner (e.g., Domestic, Export, Import with Postponed VAT accoutning (PVA), Import without PVA, EEC, etc.)

  • Tax determination (GESTVC): Used to define, by crossing the tax rule (linked to BPs) and the tax level (linked to products), the tax rate to be used in sale and purchase invoices.

  • Tax rates (GESTVT): Used to define the codes for tax rates that can be applied to sale, purchase and A/P-A/R invoices, and related journal entries. Each tax rate code is associated with a set of VAT accounts based on its associated accounting code.

  • VAT boxes (GESVTB): Used to define the VAT box set-up while respecting the nine VAT box codes.

  • VAT form (GESVEF): Used to design the structure for the VAT return based on the VAT box set-up.

Read the Making Tax Digital (MTD) how to guide on the Online Help Center as well as other relevant guides:

  • Local VAT changes, for example Switzerland (2018), South Africa (2018), and Germany (2020). The principles are the always the same because they leverage the capabilities of the Sage X3 tools: tax determination engine, posting engine and VAT framework.

Visit the Sage Brexit Hub, where you will find useful information:

Visit these links for more information regarding Making Tax Digital (MTD) requirements: