Finance User Manual ENG -> 2. Finance Configurations -> 2.10 VAT and Taxes -> LUFI-21005 How to link a partner to VAT/ Withholding Tax Configuration

LUFI-21005 How to link a partner to VAT/ Withholding Tax Configuration

It is possible for the tax attached to a supplier invoice to have another third party (the correct one for which it’s going to be paid).

For that you need to add the required third party (partner) in the tax object.

1. The Tax partner (mostly a governmental office) should be created first from Partners directly or from Accounting => Suppliers=>Suppliers=> {New}

2. To link the partner to the tax object, go to Accounting=> Configuration => Financial Accounting=> Taxes=> then in the tax object you want to use, add the third party related to this specific tax in the partner field.

3. The tax attached to the supplier invoice will have the partner chosen in the configuration of this tax. When doing the payment of this tax, it will be imported as usual through pending payment and the name of the partner will be the one linked to the tax not the partner of the supplier invoice.

Note: If no third party is added to the tax configuration, tax lines will take the supplier invoice third party.

If you need to check the last modification done in any tax object, you can click on {Track Changes} in the right-side menu.

Finance User Manual ENG -> 2. Finance Configurations -> 2.10 VAT and Taxes -> LUFI-21004 Withholding Tax Configuration

LUFI-21004 Withholding Tax Configuration

LU Introduction

Sometimes MSF is requested to pay a tax retained when making payments for goods supplied. This tax is called withholding tax. For instance a 2% withholding tax out of a supplier invoice of 100 CHF is 2.04CHF. You owe to the government 2.04CHF and to your supplier 100CHF. The total cost of your expense is 102.04CHF.

Unlike the VAT recoverable, the withholding tax is booked on a Payable account as it a debt to be paid to the government. It is booked on the credit side as any other Payable accounts. Thus this tax should be excluded from the total price to pay to the supplier. Here below is shown how to proceed.

Withholding tax booked on the credit side as any other payables account

How to Set Up a Withholding Tax

Go to: Accounting/Configurations/Financial Accounting/Taxes/Taxes

1. In the Search Taxes view, select
2. Complete the {Tax Name} and {Tax Code} fields.
3. In the Tax Application field, select the value {Purchase}.
4. Leave the field {Tax included in Price} empty.
5. In the {Tax Definition} tab, select the tax type {Percentage}.
6. Enter an amount as a value between 0 and -1. For instance, for a tax of 2%, enter -0.02. You need to enter a negative value so that this tax (payable) is booked on the credit side as any other payable accounts.
7. In the Accounting Information section, enter a payable account for both the Invoice Tax Account and Refund Tax Account.

Setting a withholding tax with negative amount

8. Click on {Save} button.

Example: The tax (1.36 USD) is what you owe to the tax office. The Total is your outstanding debt towards your supplier.

Withholding tax applied to a supplier invoice

Finance User Manual ENG -> 2. Finance Configurations -> 2.10 VAT and Taxes -> LUFI-21003 Partner Fiscal Position Configuration

LUFI-21003 Partner Fiscal Position Configuration

LU Introduction

Sometimes even though we have an agreement to recover VAT, it does not mean that all local suppliers will have the ability to invoice MSF with VAT. For that reason we would need to attach a specific tax scheme to those suppliers who cannot invoice MSF with VAT. For this exception we use the sub-module Fiscal positions.

How to Configure a Fiscal Position

1. First you need to configure a tax equal to 0 % in the taxes sub-module for partner not handling VAT.

Go to: Accounting/Configurations/Financial Accounting/Taxes/Taxes

VAT 0% used to set a partner’s fiscal position not handling VAT

2. Second step is to configure the fiscal position.

Go to: Accounting/Configurations/Financial Accounting/Taxes/Fiscal Positions

Select and on the Fiscal Positions form view, enter a fiscal position name.

Fiscal Positions form view

3. In the tax mapping section, select and map a TAX SOURCE with a REPLACEMENT TAX. The REPLACEMENT TAX should be 0%. Save the line . What you are saying to the system here is every time there is a value of 20% tax, it should replace it by 0% tax.

Tax mapping to define a fiscal position

4. Click on {Save} button.

5. Last step is the configure the suppliers – accounting information.

Go to: Accounting/Suppliers/Suppliers

1. Open the supplier form you want to link to a fiscal position.
2. Go to {Accounting Tab}, select the created fiscal position.

Fiscal position setting in a supplier form

3. Click on {Save} button.

When an invoice is generated on a partner linked to a fiscal position, the system will override the tax linked to the invoiced products thanks to the tax mapping you recorded before. The invoice will look like this:

Supplier invoice and applied fiscal position

Finance User Manual ENG -> 2. Finance Configurations -> 2.10 VAT and Taxes -> LUFI-21002 VAT and Product Linkage

LUFI-21002 VAT and Product Linkage

LU Introduction

As the applicable VAT percentage may differ from one product to another, there are 2 ways of proceeding in order for VAT to be applied at invoice level:

• Assign VAT to each product on the product form itself
• Assign VAT to the total amount of the invoice

The product is linked to VAT on the product form in the accounting tab.

Purchase Taxes on the product form

How to Apply VAT to a Product

Go to: Products

1. In the Search Products view, locate in the list the product to link to a VAT and open its form.

Products list in the Search Products list view.

2. On the Product Form view, go to the Accounting tab and select Add in the Purchases Taxes section to Add a tax.

Add button located in the Purchase Taxes section in the Accounting tab of a product form

The Search Taxes window opens

3. Among the tax list, select the one you want to link to the product.

Search Account Tax window and selection of a tax to link to a product

The Search Account Tax window closes. The tax is displayed in the Purchase Taxes section. You can edit or delete it . Please bear in mind that a tax edition from this section will change the tax initial setting of the configuration module.
Tax set in the Purchase Taxes section in the Accounting tab of a product form

Finance User Manual ENG -> 2. Finance Configurations -> 2.10 VAT and Taxes -> LUFI-21001 VAT Configuration

LUFI-21001 VAT Configuration

LU Introduction

Before setting the taxes in the instance, you must activate the taxes functionality. To activate it, you will follow the below steps.

How to Activate the Taxes Functionality

Go to: Administration/Configuration/Reconfigure

1. Search for the step “Manage the VAT” by pressing the button

Manage the VAT step

2. On the “Manage the VAT” window, check the box “Manage the VAT locally”

3. Press when the task is completed

If the Step “Manage the VAT” is left blank, the Taxes section is removed from the Configuration sub-module.

The Fiscal Position field in the Accounting tab of a supplier form is hidden

The Account Tax section in the Accounting tab of a product form is taken away

The Taxes section is also removed from any payment documents (supplier invoices, refund invoices, direct invoices)

Now let’s see how Taxes are set in UniField.

Assuming VAT applied on sales is out of UniField scope, 3 cases were identified for purchase:

VAT not recoverable. Purchases are accounted for at price including VAT. No VAT management in this case.

VAT exemption. Purchases are accounted for at price excluding VAT. No VAT management in this case.

VAT recoverable. Purchases are accounted for at price including VAT but VAT is isolated on separate Receivable Accounts for later settlement through a proper VAT declaration. The VAT recoverable is booked on the debit side as any other receivable account as it is expected to be claimed back from the government.

VAT Recoverable booked on the debit side

The different tax percentages applicable in a country are created through the taxes sub-modules.

• If it is done at HQ level, it is synchronized downwards to the mission (coordination and projects). In this case HQ can create a standard form, synchronize it and it is up to the mission to change the percentage according to the local applicable rate.
• If mission creates VAT, it will not synchronize to HQ.

VAT set at project instance remains in the instance, thus it is not synchronized up to Coordination.

Please check your OC’s procedure.

The lists of taxes are available in the Search taxes view under the configuration sub-module as displayed below:

List of taxes in the taxes sub-module

The tax form view is the object used to define the percentage, calculation, application and accounting code of a tax.

Taxes form view

Once a VAT code is set, you can :

• Associate a VAT to a product in the product form (See LUFI-20902 VAT and Product Linkage)
• Associate a VAT directly to a whole invoice before validation (See chapter 03 – Payments)

How to Set Up a VAT

Go to: Accounting/Configurations/Financial Accounting/Taxes/Taxes

1. In the Search Taxes view, select
2. Complete the {Tax Name} and {Tax Code} fields.
3. In the {Tax Application} field, select the value {Purchase}. {Sale} and {All} are not used. The {Active} box is automatically checked.
4. Leave the box {Tax included in Price} blank if price is to be excluded form price.

Taxes form view header

1. In the {Tax Definition} tab, select the tax type {Percentage}. The tax type defines the computation method for the tax amount. The values {Fixed amount, None, Python code and Balance} are not used.
2. Enter an amount as a value between 0 and 1. For instance, for a tax of 20%, enter 0.20. You need to enter a positive value so that this tax (recoverable) is booked on the debit side as any other receivable accounts.
3. In the Accounting Information section, enter a receivable account for both the Invoice Tax Account and Refund Tax Account.

Tax Definition: computation method and accounting codes setting

4. The remaining sections on the form as well as the Special Computation tab do not have to be completed.

Special Computation and Tax Declaration Invoices are left as such

5. Save the form.

6. In the Taxes Search view list, the tax is displayed. You can always edit or delete it

Search Taxes view

• You will have these filters in the search view: [active] [inactive] [Tax included in price] [Tax not included in price].
• For the status [active] or [inactive] filters, the default display will be [active].
• For the types [Tax included in price] or [Tax not included in price] the display will be both.

Finance User Manual ENG -> 2. Finance Configurations -> 2.10 VAT and Taxes.

LUFI-21001 VAT Configuration
LUFI-21002 VAT and Product Linkage
LUFI-21003 Partner Fiscal Position Configuration
LUFI-21004 Withholding Tax Configuration
LUFI-21005 How to link a partner to VAT/ Withholding Tax Configuration

VAT AND TAXES

Depending on the agreements made with local governments, MSF may manage 2 types of taxes: VAT and withholding taxes. Both types can be managed directly in UniField. Please refer to your procedures to check if the recording of VAT and withholding taxes is mandatory in your section.

Finance User Manual ENG -> 2. Finance Configurations -> 2.9 Products and Product Categories -> LUFI-20901 Local Product Configuration

LUFI-20901 Local Product Configuration

A.   LU Introduction

While there is a master file of international products that is common across all sections and missions individual missions may also create local products based on their missions’ individual financial and supply procedures. Remember the common Unit of Measure used in MSF is the Unit (PCE).

B.   How to Create a New Local Product

Go to: Products/Products

• Click .
• Fill in all blue mandatory fields. Code and Description should follow mission standards.
• On the Information tab you must fill in:
  • Stockable product, a non-stockable product or a service with reception.
  • Costing Method = Average Price or Standard Price. Select Average Price and UniField will automatically recalculate the average costs based on the costs paid when the good is received in the warehouse module. If Standard Price is chosen the user must write in a standard price. This price will continue to be used regardless of actual costs paid.

Finance User Manual ENG -> 2. Finance Configurations -> 2.9 Products and Product Categories.

LUFI-20901 Local Product Configuration

PRODUCTS AND PRODUCT CATEGORIES

The ITC Product Master data (Unidata) is loaded as part of the installation and is shared by all OCs. All single products are linked to a product category, which is linked to an Accounting code. It means that each individual product doesn’t necessarily have an individual accounting code, the one by default taken into account being the one of the product category.

If the account code to be associated to a product differs from the account set on the product category, you will then link a specific account code directly to the product itself. In this case UniField will by default use the account defined on the product instead of the one defined on the product category.

In each mission, it is possible to create local product that is not in the master data file, for instance a product of type service like “house rental”.

There are different product types:

1. Stockable product: for products which are usually in stock and can be stored
2. Non-stockable: for products which will not be managed in the warehouse storage. For example: Expat food, some stationeries, etc.
3. Service with reception; services that are formally received in the system to confirm they have been consumed. For example: Electricity bills, construction contracts, or transport contracts.

A product, e.g. cable, is assigned to a Category field on the Information tab.

Product category displayed on the information tab of a product form view

Each product category is linked to an expense and an income account (booked on the purchase journal) and a donation account (booked on the extra-accounting journal). Therefore, every time a product is selected UniField will automatically link this product to an expense account and a donation account.

Product category {ELECTRICITY} and associated accounting properties

The mapping (and updating) of the product category / expense account / income account / donation account link should be done by the person in charge of the data base set up at HQ level (import file) in the sub-module {Products Categories} in Accounting/Configuration/Miscellaneous.

Finance User Manual ENG -> 2. Finance Configurations -> 2.8 Suppliers and Customers -> LUFI-20803 Inactivating a Partner

LUFI-20803 Inactivating a Partner

LU Introduction

Before inactivating a partner/supplier, you must confirm all documents (invoices, purchase orders, field orders, and vouchers of any kind) associated to this partner are closed. If not you will be prevented from disabling the partner and the following error message will appear:

How to Inactivate a Supplier

Go to: Accounting/Suppliers/Suppliers

1. The partners list appears. You can use the filter buttons or fields to narrow your search to a specific supplier or customer.

2. To display partners states with 3 buttons :

• SHOW ACTIVE : Display only active partners
• SHOW PHASE OUT : Display deactivated partner but still linked with open documents ,so no more creation of future documents with phased out partner
• SHOW INACTIVE : Display the inactive partner. All linked documents should be closed with the end process.

3. When your partner is located, click on the pencil to edit the partner form,then partner form opens:

• box “Partner Status” with active under combo-box “Partner type“
• buttons “Deactivate partner” & ” Re-activate partner “under box “Partner Status“
• for active tick box always frozen whether ticked or unticked , the active tick box ticked in both status: Active & Phase out
• In Search: Track changes is possible to see the following:

1. Field Description >> “Active” with 2 values True & False
2. Field Description >>”Partner Status” with 2 values active , inactive & phase out as below:

Finance User Manual ENG -> 2. Finance Configurations -> 2.8 Suppliers and Customers -> LUFI-20802 Partner Deletion

LUFI-20802 Partner Deletion

LU Introduction

Authorized financial and supply users have the option to delete a partner for example when a partner was created by mistake. However, partners cannot be deleted if they have transactions against them. In such a case, there is a warning message. Also, partners can’t be deleted if they originate from other instances.

In this example, you cannot delete this partner because there is a transaction booked against it in a bank register.

How to Delete a Supplier

Go to: Accounting/Suppliers/Suppliers

1. The partners list appears. You can use the filter buttons or fields to narrow your search to a specific supplier or customer.
2. Click on the red cross on the right corresponding to the partner which you want to delete.
3. A confirmation pop up appears.
4. Click {Yes}.

Partners form removal buttons