The following tax codes are set up in the system by default:
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T0 zero rated transactions
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T1 standard rate
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T2 exempt transactions
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T4 sales to VAT registered customers in the EC *
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T5 lower rate
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T7 zero-rated purchases from suppliers in the EC **
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T8 standard rated purchases from suppliers in the EC **
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T9 transactions not involving VAT ***
* This tax code can be used for VAT registered companies outside of the UK, but within the EC. You must have the customer’s VAT registration number entered on the customer’s record if you want to use the T4 tax code. If your customer is not VAT registered, you should use one of the following standard UK VAT rates.
** These tax codes can be used for suppliers outside of the UK but within the EC. In accordance with VAT regulations, EC VAT rate codes used for purchases are given a ‘notional’ rate that is linked to a UK VAT rate. For example, the T8 tax rate for standard-rated purchases from suppliers in the EC is linked to T1, which is the standard rate of VAT in the UK.
*** These transactions are not included on the VAT Return. FuseMetrix also uses T9 as the default tax code for all the routines that are non-vatable, e.g. journal entries and error corrections.
To view, change, and add tax codes, go to System Setup > Finance > Setup Tax Codes
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To add a new tax code, click ‘Add’ at the top of the page. Fill in the details and click Save.
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To edit an existing tax code, click on ‘Edit’ and you will be able to update any of the details relating to the tax code. Click Save.
