Companies that are exempt from VAT

If your company is exempt from VAT, you must specify this within the company settings. To do so, go to View - Settings - Company - Financial Settings, and then select No VAT/VAT exempt in the drop-down list for VAT. Note that this setting only prevents the calculation of VAT with invoicing, VAT will still be calculated with, for example, manual posting in the journal entry if you choose an account that is connected to a VAT code. To avoid the calculation of VAT in the journal entry, you must either choose to make entries exempt from VAT or you must set the VAT code on all accounts to None.

When you select No VAT/VAT exempt in the company settings you will be asked if you wish to set the VAT codes to None on all accounts. Please note that this selection cannot be undone or reversed if you select Yes. If you at a later point wish to start using VAT, you must manually provide the VAT rates for all relevant accounts.

Tip!If you have chosen No VAT/VAT exempt while creating the company database, and at a later date wish to set all VAT codes to none, simply go to the Financial Settings and select Registered in the VAT drop-down list, and then select No VAT/VAT exempt again. You will now be asked if you wish to set the VAT codes to None for all accounts.

You can also specify whether the VAT codes will appear in the journal entry. Read more in Editing the VAT codes.

In addition, you are able to change the VAT codes manually for each account, or alternatively specify that specific accounts shall not be shown in the journal entry. Read more about how to edit accounts in Chart of Accounts Properties.

Tip! If you would like an overview of the accounts that have VAT codes, you can print out the report Chart of Accounts, Nominal List. To print this report, go to View - Accounting - Reports, then select Accounting from the list on the left, and then select the Chart of Accounts, nominal list report and click Print. You will now easily be able to see an overview of the accounts that are affected.