VAT periodic reporting

Requirement

Companies regularly report outgoing and ingoing VAT, monthly, bi-monthly, or quarterly. Companies declare the difference as an amount to pay or, in some cases, receive an amount back from the government. The required content in the report depends on the country legislation. The VAT report must include outgoing and ingoing VAT, and, in most countries, the turnover per VAT code. VAT reports can be paper-based, manually filed on an Internet portal, or sent electronically to the government.

In Kenya, companies must report VAT monthly.

The filing is due by the 20th of the month following the reporting period. Any due VAT must also be paid by this date. A “nil” return must be filed if no VAT is payable (either because the taxable person has made no supplies or because input tax exceeds output tax in the period).

If the normal filing date falls on a public holiday, or on a weekend, the VAT return must be submitted on the last working day before that day. VAT returns are now being submitted online.

M3 solution

The summarized information required for VAT return is created by M3. Generic functionality includes calculation, accounting, reporting, and reconciliation of VAT.

The basis for the report is handled by the M3 VAT report generator as required in Kenya.

Configuration guidelines

Program ID Program name Description or comment
MNS100/G Company. Connect Division Set the tax method per division and specify the company tax and VAT registration number.
CRS750/F Settings – General Ledger

Specify this information:

VAT from date
VAT chk online
Select this check box.
Acceptable VAT deviation
Specify, for example, 0.01.
VAT date type
Specify 2-Invoice date.
VAT printout
Specify 3-VAT on inv & in AP.

CRS030

CRS031

VAT Code. Open

VAT Rate. Open
CRS395 Accounting Rule. Set Configure all VAT setups.
CRS630 Accounting Identity. Open
CRS610/J Customer. Open Set the Tax applicable field and specify the VAT code.
CRS624/F Supplier. Define Purchase & Financial Set the Tax applicable field and specify the VAT code.
MMS001/G Item. Open Set the VAT code purch and VAT code sales fields to the VAT codes for purchasing and selling.
MMS002/I Item. Connect Warehouse

To open (MMS002), select a record in (MMS001), then select Related > Item/Warehouse.

In (MMS002/I), set the VAT code purch and VAT code sales fields to the VAT codes for purchasing and selling.
OIS002/F Customer. Connect Addresses Optionally, in the VAT reg no field, specify the VAT registration number.
TXS005-TXS009 VAT Report Template. Open Define the content that is required for the VAT report.
TXS020 VAT Exception. Open
TXS030 Fiscal Representation. Open Complete the fields if relevant.
TXS100 VAT Run. Open