7.6.2.1 Configure the VAT / GST Calculation

Version 

2.80 and up(Country configuration)

Version 

2.116 and up(State configuration)

Applying VAT/GST to your Media Campaigns within ADvendio is an automated, synchronised process. VAT can be set up for a number of different situations (Country to Country, State to State within a country), State to State across borders) and requires a few configuration steps before it can be used. 

All steps below must be completed before VAT can be used and applied within your org. 

Steps to follow

In order to set up the correct calculation of VAT for your Media Campaigns and Invoices you have do the following steps:



1. Prepare Picklists/Record Types - Update Customers Only

If you've updated from an older version of ADvendio, you need to make sure that picklist values are connected to object record types. For the new VAT Calculation we need the picklist "Taxable Amount Type".

The field will be used at the objects:

  • Media Campaign,
  • Campaign Item,
  • Invoice,
  • Invoice Item and
  • Legal Entity.

If you don't perform these steps, the new VAT Calculation won't work and will give you an error in the Media Configuration.

The Salesforce update logic unfortunately doesn't create this connection automatically. The ADvendio default has three different for the object Campaign Item. So you need to perform the following steps for all the record types of Campaign Item and if you are using custom Record Types for any of the Objects listed above:

  1. Navigate to Setup > Object Manager
  2. Select the Object for which you want to modify the Record Types (Example: Campaign Item)
  3. Scroll down to the Record Types Section and click on the name of the first Record Type.
  4. You see a list of all Picklist fields. Click on Edit next to the field: Taxable Amount Type
  5. Move all values from Available Values to Selected Values, a default value doesn't need to be set
  6. Repeat for all Record Types,


If you set the Default of these picklists to none you can alternatively use the following Feature Setting to set a Standard value:

Feature Setting NameFeature NameTemplate NameValue
DefaultsFinanceTaxableAmountTypeN2 or N3

2. Active the "new" VAT

  1. Navigate to Overview
  2. Scroll down to Setup & Settings
  3. Click on Administration Settings
  4. Select the "Administration Setting" Tab
  5. Set the "New VAT Calculation" Checkbox to true
  6. Click Save

Activating 'Use New VAT Calculation' will check the field 'New Vat Calculation' on all newly created Media Campaigns. It will not update already existing Media Campaigns to use the new VAT calculation. If you want to do this, you will need to also check this field on older Media Campaigns. This would not be advised for Media Campaigns which have already been invoiced.


If you have existing Media Campaigns (which were, for example, created during the set up of your VAT settings), where New VAT Calculation was active but no VAT settings were configured to match at the point of creation (between step 2 and 3/4), then you will need to trigger the VAT calculation again. This can be done either through unchecking and checking new VAT Calculation on Media Campaign level or changing some VAT matching relevant information, such as one of the Media Campaign Accounts or Legal Entity.

3. Manage Custom Setting - VAT

As mentioned above, VAT settings can be created to cover a number of different situations. You can create VAT settings on a country or state basis, depending on your business needs. Based upon the number of countries or states that you operate in, you need at least one VAT setting for each combination.

To create or edit a custom VAT setting do this:

  1. Navigate to Setup > Custom Code > Custom Settings (Classic: Setup > Develop > Custom Settings)
  2. Select VAT > Manage
  3. Click New or Edit next to existing records.
  4. Enter a Name for this VAT information, for instance, use "DE/DE_2016_Typ1".
  5. Use the Country Buyer and Country Seller fields to determine the country combination for the VAT Rate.
    1. The "Country Buyer" will be the country of your customers and will later be taken by default from the Debtor entered in the Media Campaign.
      1. The "State Buyer" will be the state of your customers and will be taken by default from the Debtor entered in the media Campaign 
    2. The "Country Seller" is the country you operate in, take from either the Legal Entity in the Media Campaign or your Salesforce Org Company Profile
      Please note that the entered values in your VAT setting need to be identical to those on your VAT Buyer or in your Legal Entity/Org settings.You might, for example, enter: 
      DE", "Germany", or "Deutschland" in your VAT settings, but then you need to ensure it matches your VAT Buyer Account and Legal Entity/Org settings (see below 4.. and 5.a)
      1. The "State Seller" the country you operate in, taken from either the Legal Entity in the Media Campaign or your Salesforce Org Company Profile
  6. Enter the Type !!! ImportantThis type needs to match the VAT Type Numbers in your Adspecs. We currently offer only two types, so choose from 1 or 2. Please refer to Section 6..  
  7. Enter the VAT A in % for type A, for instance, use "5.00" or "19.00".  
  8. Enter the VAT B in % for type B (if applicable). 
    1. VAT rate B would be calculated on the taxable amount, just as VAT rate A.
    2. Note: if VAT rate B is used, then the external names of the VAT rates will be displayed on invoices 
  9. Enter the external name for VAT % A  this is the name/classification of the VAT A %. Example: "GST". This can be used  by external reporting/third party finance systems and may be shown on invoices (if VAT rate B is used)
  10. Enter the external name for VAT % Bthis is the name/classification of the VAT B %. Example: "PST". This can be used  by external reporting/third party finance systems and will be shown on invoices.
  11. Enter Valid From as well as Valid to, if this VAT setting is valid in an specific time frame. (This is mandatory!)
  12. You may check the checkbox 'VAT charged (non-valid VAT Id number)' to decide about the VAT Rate according to the Debtor VAT Id (see point 10 at the bottom of the page).
  13. Enter the external name VAT Classification - this is an overall name/classification for the VAT Type as a whole. This can be used  by external reporting/third party finance systems and will be used on invoices to group VAT rate A and B together. 
  14. Click the button Save.
  15. Make sure to delete or modify the example records that came with the ADvendio package!


Please make sure that the entered values for Country Buyer and Country Seller are identical to those in the VAT Debtor and Company Profile / Legal Entity. Otherwise the system will not be able to match the correct VAT Rate!

Country to Country (Germany to Germany)

State to State within a Country (Canada):


4. Defining your VAT 'Buyer' and Modifying Account Records

The default 'Buyer' as per the VAT matching will the Debtor of your Media Campaign. However, as of of 2.117, it is possible to configure the Buyer for your Media Campaign in terms of VAT matching and to create fallback logic in case this field is not filled in your Media Campaign.

4. a Defining your VAT 'Buyer'

Note:

You only have to do this step, if the VAT laws of your Country require the VAT 'Buyer' to be someone other than the person/company paying for the service. Otherwise proceed with 4.b

For example, you operate in a country where the applicable VAT is decided by the location where the service will be 'consumed', not the location of the person paying for the service. You have a Media Campaign which will be paid for by a Holding (the debtor) for one of their daughter companies/associates in a different location (beneficiary of the Media Campaign). The default VAT matching would incorrectly apply the VAT relevant for the Debtor location. Through use of a feature setting, you can ensure that your VAT is always matched to the beneficiary of a Media Campaign

In most cases the Debtor of a Media Campaign will also be the beneficiary of the service, meaning you would want the VAT matched to your Debtor location, unless a Beneficiary is set. In this situation, you would configure your Feature Setting as below (Beneficiary, Debtor). In this configuration, the matching would first look at the Beneficiary, if nothing is set on Media Campaign level, it would then look at Debtor.  

 

The Feature Setting can be configured for all account types related to your Media Campaign. 

  • Advertiser - Account on Media Campaign 
  • Agency
  • Beneficiary
  • Debtor 
  • Intermediary
  • PostalRecipient

4. b Modify your Buyer Account

Makes sure that all your customers records have the Billing Country and Billing State field filled.

5. Define your Seller's Country

5.a. Legal Entities

Note:

You only have to do this step, if you are using legal entities. Otherwise proceed with 4.b.

Navigate to Overview - Object Legal Entities. Open all your records and enter the 

  1. Country ISO Code (recommended!) or alternatively use the free text field 
  2. Country
  3. Billing State

 

5.b. Salesforce Organisation's country

If you are not using Legal entities please make sure that you have entered a country in your Salesforce Organisation as the system will choose your Salesforce Org's country/state as Seller Country and/or Seller State. You will find this under Setup - Company Profile - Company Information. Make sure to fill the Address field Country with the 2 digit Alpha ISO Code of your country. List can be found here: http://data.okfn.org/data/core/country-list

6. Set the VAT Type in all relevant AdSpecs

Make sure your Adspecs have the VAT Type set to either 1 or 2. This should match the type in the Custom Setting VAT.

7. Manage Custom Setting - Mapping BA

You might need to extend the custom setting Mapping BA. This mapping is used to create a new pre-invoice out of your Media Campaign when you push the "create pre-invoice records" button or do a pre-invoice billing run. Get more information here: 7.6.1 Configure Mapping BA

Attention:

If you have upgraded your ADvendio Version to > 2.80 from a prior version, you need to manually update the Mapping BA entry for the field:

  • VAT-Exempt (Item). Remember to edit both records the SOURCE and TARGET value needs to be set to "Item.VATExempt__c".

If you have upgraded your ADvendio Version to > 2.114 from a prior version, you need to manually update the Mapping BA entry for the field:

  • Legal Entity Country. The new SOURCE needs to be SellerCountry__c.


Please check out the following page for more information: 7.6.1.1 Version Changes for Custom Setting: Mapping BA.


8. Configure your Invoice and Quote Preferences

To show VAT on your Invoices and Quotes, please check the field Show Gross Campaign Costs in the relevant Quote and Invoice Preferences. 
Note: if VAT rate B has been used in the applied VAT of a Media Campaign, the external names of VAT A and B will show on the invoices. Additionally, if the field external name VAT Classification has been filled, this will show on your Quote or Invoices and will show VAT A and B combined. 


For further information, read 7.5.2.4 Show the Gross Value (B3) and VAT on an Invoice and 7.5.1.3 Show the Gross Value (B3) and VAT on a Proposal.

To use the reverse charge mechanism please check the field within the media campaign record. More details can be found here: 6.1.5 Reverse Charge Mechanism.

9. Change the Layouts

Change the layouts for Media Campaign, Invoice, Campaign Item and Invoice Item to show the fields you need. Please refer to the list here: 7.6.2.2 VAT fields Overview.

10. VAT charged (non-valid* VAT Id number)

Version 2.96 and up

If you cooperate with countries where VAT rates do not need to be calculated please take note that the checkbox 'VAT charged (non-valid VAT Id number)' in your VAT Custom Setting (see above) leads to the following behavior:

  1. If the Debtor has a VAT Id entered and the 'VAT charged' checkbox is checked the Media Campaign and Invoice will not set a VAT rate

  2. If the Debtor has a VAT Id entered and the 'VAT charged' checkbox is not checked in the settings the Media Campaign and Invoice will set the VAT from the setting
  3. If the Debtor does not have a VAT Id entered and the 'VAT charged' checkbox is checked the Media Campaign and Invoice will set the VAT from the settings
  4. If the Debtor does not have a VAT Id entered and the 'VAT changed' checkbox is not checked the Media Campaign and Invoice will set the VAT from the setting

Example 

Debtor VAT Id No. (ADvendio__VatIdNumber__c)VAT charged (non-valid VAT Id number)VAT Rate %Seller CountryBuyer CountryResult
DE123456789false19%DEDE19%
-false19%DEDE19%
FR123456789true19%DEFR0%
-true19%DEFR19%
**The VAT Charged mechanism test whether the ADvendio field: ADvendio__VatIdNumber__c is filled! Therefore non-valid means empty, there is no validation on the values entered in this field.