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VAT changes - how does ERPNext handle them?

We have just recently had a change in our VAT (German Mehrwertsteuer, Germans know what I’m talking about). My - very general - question is now: How does ERPNext handle such a situation? Is there a centralized function to make all necessary changes in one go? Another (much smaller) software I know can’t handle it at all, the tax is stored per item and each single existing one has to be edited manually.
Thanks for your input

I don’t know anything about how VAT works in Germany (others certainly will), but generally speaking ERPNext would treat VAT as just another running account balance. When issues sales invoices and marking purchases, ERPNext will add or subtract a range of taxes and charges automatically as per templates that you can set up. Whenever you need to file, you can view a ledger of all your VAT ins and outs, and from there you can see the balance you owe.

Yes, Data Import tool can help you to update bulk.

Thanks for your inputs, though @Suresh_Thakor I am not sure that it’s the function I am looking for. I mean, I could export all 13.000 items to Excel, change the tax, then re-import them. But I was rather looking for an in-program solution. Or did I not get you right?

Can you clarify a bit what you’re hoping to do? Generally speaking, ERPNext does not make it easy to change already issued invoices, and that’s very intentional. Most accounting standards require a full cancellation and reissuing cycle in those circumstances.

On the other hand, if you want to change vat rates on all invoices going forward, it’s simple to do.

Sorry, in that case I really have to clarify.

I don’t want to change existing documents at all (isn’t supposed nor intended to happen, I know), but since the changes in tax rates are government set at a fixed date and absolutely mandatory, I have to change the rate when an offer gets turned into an order confirmation or that into an invoice, if the date of the changes happened inbetween.

Also I have to change all articles - if the tax rate is stored per article. If that rate is stored elsewhere and only linked to items, that’s the easy solution I am looking for. Like: VAT rate #1 = x%, linked to all articles that require this rate. Change the value of rate #1 - all articles pull the rate from this one place and have the correct rate in one go.

Bad example, like I wrote before: the other software stores the tax rate in the articles table, not linking it, so you have to change each item individually to adapt to a new rate.

(A little background info: There are already two individual rates, one for food and many other articles and services that are considered “essential” at 7%. The other one is general for everything else, currently at 19%. Plus a few more exceptions at wildly different rates. Confusing, I know.)

Please squeeze me for more information if things are still unclear!

I know it’s a bit of an issue of not knowing enough about how ERPNext works, but I have to learn somehow.

Okay, that makes sense.

ERPNext gives a lot of flexibility regarding how taxes are represented. For the case you’re describing, you’d define different tax rates in Item Tax Template documents. One might be “Essentials”, which assess VAT at 7%, and another might be “Normal” which assess VAT at 19%. (Images for reference; In the picture “VAT - kb” is the name of the account these taxes will be booked under.)


Then, in each Item document, there’s a field for Item tax templates. Here, you would indicate which kind of Tax Template should be used for that item type in invoices. Down the road, if the essential rate gets changed from 7% to 5%, you just edit the one template document and going forward that new rate will be applied.

You can even indicate several that get applied after particular dates or for particular kinds of customers. So, if I had a product that was historically taxed as “essential” but starting this year was taxed as “normal”, I could set up the item tax field as such:

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