Solution at hand – Mapping the VAT change clearly and correctly in the utility statement

In June, the German government decided on short notice to lower the VAT rate to limit the economic impact of the COVID-19 pandemic. Practically overnight, PROMOS integrated the new tax rates into the systems of its customers and already began preparing in the summer for the switch back to the old rates at the end of the year. Utility statements must now be drawn up for a year with differing tax rates.

Keeping pace with current developments – seamless VAT adjustment

From 1 July to 31 December 2020, the reduced VAT rates of 16 and 5 percent were valid in Germany instead of the usual 19 and 7 percent. Reacting quickly to changing conditions and developing efficient solutions that achieve great impact with minimal effort are vital characteristics of the PROMOS way of doing business. So there was also no procrastinating in June 2020. Consultants from our various specialist departments came together at lightning speed and developed solutions to enable quick and uncomplicated implementations. After all, the resulting solutions would have to go live within only a few weeks. This involved updating tax codes in Customizing, configuring programs and making adjustments to invoicing in the easysquare craftsmen portal – all while working to ensure an easy reversal at the end of the year. Sure enough, PROMOS customers were quickly able to map the new tax rates in their systems and switch back to the regular ones equally as quickly at the end of the year.

Split claims in the utility cost statement letter for 2020

Many companies are currently facing the next challenge posed by a mid-year change to the VAT rate. Companies with settlement-related, taxable leases for the 2020 utility statement must now split their claims. In concrete terms, this means that the determined net claim is split for these tenants between the two halves of the year in the utility statement. For PROMOS customers already enjoying the advantages of the modular utility statement letter, a solution for mapping this split has already been developed (Figure 1). The statement letter conveniently divides the claims into two half-year periods with corresponding intermediate sums and indicates the total credit or claim for the overall settlement period at the bottom. In addition to the settlement letter adjustment, a new settlement template with split claims must also be created in SAP®. An appropriate mapping can also be integrated for customers who use an individual SmartForms template.

Do you have questions or are you uncertain about whether our solution can cover your specific situation? Get in touch with us and we can find answers together!

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