ou must set up VAT rules in Envoice if you use Envoice to create and send sales invoices. If you create sales invoices in your accounting software and only use Envoice to forward invoices to clients, setting up VAT rules in Envoice is not required.
Tax rules ensure that sales invoices created in Envoice are correctly reflected in your accounting software entries and financial reports.
Products and services are grouped based on the tax percentage and the sales revenue account.
If a company sells products with a single tax rate and the sales revenue is recorded on one general ledger account, you only need to set up one tax rule.
If the accounting system separates sales revenue for different items (e.g., groceries and consumer goods on separate accounts), you must set up multiple separate tax rules.
How to create or edit a tax rule?
Follow these steps to create a new VAT rule or edit an existing one:
Log in to your Envoice account.
Go to Settings choose Accounting.
Select Tax Rates.
Find the relevant tax code and click Edit at the end of the row.
In the "tax rules for sales invoices" section, click the Add new row button.
Fill in the rule settings:
What am I selling?: choose "Product" or "Service".
Where am I selling?: choose the market (Domestic, European Union, or Outside European Union).
Sales revenue account: choose the general ledger account.
Rule name: enter a short description.
Save the changes. You can also add a new VAT rule directly while creating a sales invoice by clicking "Add new VAT rule" in the invoice row section.