bcquality/microsoft/knowledge/finance/normal-vat-journal-amount-includes-vat.md

bc-version	domain	keywords	technologies	countries	application-area
all	finance	normal-vat automatic-vat-entry gross-amount net-amount vat-posting-setup gen-journal-line purchase	al	w1	finance

Supply a VAT-inclusive journal Amount for automatic Normal VAT

Description

For a general-journal line using Automatic VAT Entry and Normal VAT, Amount includes VAT. The posting engine extracts tax from that total; it does not add tax to a VAT-exclusive expense imported into Amount. For an LCY purchase of net 100 plus 25 VAT, entering 100 produces an 80 expense and 20 VAT, rather than the intended 100 expense and 25 VAT from a total of 125.

Best Practice

Map the source's VAT-inclusive total to journal Amount in this posting mode. Establish the intended account and posting-group combination before validating the final amount. Account-derived VAT defaults depend on Copy VAT Setup to Jnl. Lines; do not assume account selection always supplies the intended configuration.

Require the actual input contract and calculation mode, not just a variable named NetAmount. The examples encode source net, VAT, and gross values plus a 25% Normal-VAT setup check. They target an LCY G/L purchase with 0.01 amount rounding and without balancing-side VAT, additional reporting currency, VAT differences, unrealized VAT, or non-deductible VAT. Other calculation types, Manual VAT Entry, reverse charge, Full VAT, sales/use tax, non-deductible or unrealized tax, and other currency/rounding contexts need their own analysis; this is not a universal gross-up formula or country-specific tax advice.

See sample: normal-vat-journal-amount-includes-vat.good.al.

Anti Pattern

In the demonstrated automatic Normal-VAT configuration, put a provably VAT-exclusive source amount into journal Amount while expecting posting to add tax. An amount assignment alone, unknown setup, or a suggestive variable name is insufficient. Do not report the correctly supplied gross amount or automatically rewrite tax calculations outside this scope.

See sample: normal-vat-journal-amount-includes-vat.bad.al.

References

• VAT posting setup combinations.
• BCApps: journal amount validation.
• BCApps: Normal VAT extraction during posting.
• BCApps: journal VAT amount regression cases.