[OFBIZ-7012] VAT tax are not recorded as separate line items in Invoice for products with VAT tax included in their price

• Type: New Feature
• Status: Closed
• Priority: Major
• Resolution: Fixed
• Component/s: accounting, order
• Labels: VAT tax
• Assignee: Divesh Dutta
• Reporter: Divesh Dutta
• Created: 16/Apr/16 12:30
• Updated: 11/Jan/20 10:38
• Resolved: 05/Nov/16 11:05

Description

In countries like UK VAT system works. So in VAT system, VAT taxes are included in product's price. So OFBiz have support of VAT tax where you can include VAT in product's price itself. Here is the example data we create to enable VAT calculations:

<Party partyId="GB_TA" partyTypeId="PARTY_GROUP" statusId="PARTY_ENABLED"/>
 
<PartyGroup partyId="GB_TA" groupName="Great Britain Tax Authority"/>
 
<PartyRole partyId="GB_TA" roleTypeId="TAX_AUTHORITY"/>
 
<TaxAuthority taxIdFormatPattern="\d{2}\-\d{7}|\d{3}\-\d{2}\-\d{4}" taxAuthGeoId="GBR" taxAuthPartyId="GB_TA"/>
 
<TaxAuthorityRateProduct taxAuthorityRateSeqId="6002" description="Standard E-Commerce Great Britain Tax Rate" fromDate="2016-01-01 00:00:00.0" productStoreId="9000" taxAuthGeoId="GBR" taxAuthPartyId="GB_TA" taxAuthorityRateTypeId="VAT_TAX" taxPercentage="20.00" />

<ProductPrice currencyUomId="GBP" fromDate="2012-07-03 00:00:00.0"price="139.000" productId="GZ-2644" productPricePurposeId="PURCHASE" productPriceTypeId="DEFAULT_PRICE" productStoreGroupId="_NA_" taxAuthGeoId="GBR" taxAuthPartyId="GB_TA" taxInPrice="Y" />
 

When invoices are created, tax amount included in product's price is not separated in new invoice line item. And when general ledger postings are done, then tax amount is not posted in Liability account. So due to this organizations have no way to figure out how much tax is to be paid to tax authority.

Ideally, product's actual price (without VAT) should be recorded in revenue account and tax should be recorded in liability account.

For doing this, when invoice is created, VAT amount should be separated and created as new line item.

Recently we have worked for one of our client where we have fixed this issue and enabled invoicing in OFBiz to record vat tax amount as separate line items. lektran has actively worked with us to finalize the solution design and completing the implementation. ankush.upadhyay is the developer who worked on solution design. ankush.upadhyay please provide the patch for this issue.

Issue Links

• breaks: OFBIZ-11316 Bug when order contains adjustments with NULL amount
• is related to: OFBIZ-5403 Implement separate glAccounts per TaxAuthority-ProductCategory combination
• relates to: OFBIZ-9492 Tax Authorities need two GL accounts for sales and purchases