Investment charge tax

Investment charge (IVC) is a shifted expensed purchase tax that is applied on investment amounts on purchase invoices in Norway. IVC is used to steer investments, for example, environmental investments can be exempt from investment charge tax.

Investment charge tax can apply to the transaction lines of purchase cost invoices and invoices related to orders. Investment charge tax also applies to journal vouchers and cash journals. As investment charge tax is an expensed tax, the tax amount is added to the ledger account of the transaction line when you enter the invoice.

If you create a purchase invoice to which investment charge applies, LN posts the investment charge amount as payable to the tax authorities. The investment charge amount must be paid to the tax authorities before the due date. If investment charge applies to a transaction, it also applies to recurring invoices for the transaction and to invoices created from transaction schedules.

The IVC implementation parameter is part of the Accounts Payable module. If you select this parameter, investment charge tax is only registered in the current financial company. In a multicompany structure, you can only make changes or delete the IVC tax code by country details if you work in a financial company in which the IVC implementation parameter is selected. In all other companies of the structure, the IVC tax code information is read-only.

Both VAT and investment charge tax can apply to a transaction. As in LN you can select only one tax code for a transaction, you can associate an IVC code to a VAT code. If you then select the VAT code for the transaction line, LN calculates and posts both the VAT and the IVC tax amounts.