Increase in the standard rate of VAT to 20%

First of all, this depends if you are dealing with VAT at all. If you are not VAT registered, obviously it does not matter and no further action is necessary..

If you are calculating and showing VAT in your Eulogica invoices, however, you need to update Eulogica with the correct percentage. Luckily, this can be done with ease.

The short answer is:

Go to the “Tools” menu, select “Products/Finance”, and click “VAT codes”. Here you will find one or two codes, normally T1 and T8, probably set at 17.5 percent. You should open both of these and change them to 20 percent. Click OK to save.

But there are a few complications...

In Eulogica, the VAT rate is obtained from the file mentioned above, at that moment when your product is entered to a funeral. That is, when it is picked from the product file, e.g. when the coffin is selected. The VAT rate is not re-examined at any later time, not even when an invoice is raised. This ensures that invoices follow the same rules as estimates. So the invoices raised from old funerals will get the old rate.

This is beneficial if you have configured Eulogica to date your invoices according to the date of the funeral. E.g. if a funeral is entered in December and carried out in December, then you raise the invoice in January, it will get a December date and it will get the old VAT rate. This is fine.

There are some possible complications:

1. If some products were entered to a funeral before the change, and others are entered afterwards, there could be products with different VAT rates in the same funeral. This is not desirable.

Therefore, please keep an eye on the VAT calculations of funerals in the beginning of 2010. You can see this clearly on the “Accounting” subpage of the “Finance” page in the Funeral window. (There is also a corresponding “Accounting” page in the invoice window.)

Should you discover that this becomes a problem, just re-enter those products which have the wrong rate. That is, just pick the products again from the product file. The current rate will then be applied. (You could also just re-enter the price, or the quantity, etc.)

2. Current funerals are not going to be automatically re-calculated when raising the invoice. Your invoices will contain the same figures as your estimates. This is normally what you want, but maybe not in every case. If a funeral was entered in December but is carried out in January, your invoice will be dated in January and will need to use the new percentages.

The solution is the same as above: Re-apply VAT as described above.

3. If your invoices are dated as you issue them (rather than according to the funeral date), you will get the same problem as above if you invoice in January some funerals that were carried out in December. Again the solution is the same.

Before raising invoices this January, please take a moment with each funeral and check that you are happy with the VAT calculation in the Funeral window (“Accounting” subpage of the “Finance” page).

To summarise, this change is not likely to cause many problems, but do keep an eye on the calculations. Should you find that you run into any problems, please feel free to contact us and we will be happy to help.