Hi guys, I'm new to this but was hoping to get some help. Is anyone familiar with VAT-MTD? Specifically setting up tax codes for customers that have various ship-to countries (within and outside EU). And since my company is required to report both EC and Intrastat, sales to those customers need to be segregated between goods and services as well?

@Michael Round might be your guy...

Thanks for replying C. So we are not too sure how to set-up tax codes. Customer record has only 1 spot for Tax code; and only one spot for Tax ID.

sounds like you need more experience with Tax Schedules too...if Michael doesnt know the answer he can probably refer you..He is UK based and generally the Out of the Box answer guy for EU taxes

We tried exploring the use of tax schedules too - we can probably put a different one for products vs. services, but we're not too sure if it's nexus driven. Thank you C, will wait for Michael later.

everything is nexus driven but with what I have heard you wont get automation...the best you get is unique tax schedules that deliver specific tax codes per item

Oops, big work ahead! 🙂 Have you heard anything about customers with diff ship-to countries? We are not using nexuses since we are not registered VAT in those other countries and should only be using UK tax codes. Also in EC report, we get errors as we can only have 1 Tax ID in the customer card, whereas we can have different ship-to countries for 1 customer that are different from the country initial of the tax ID.

Hey Moneete - The Ship to address will drive the tax code, and in most cases in EC it will recognise if this sale type is Service/Non-Service and Internal/Outside the EU. From here it wiil nominate the derrived tax code - for example S-GB will be EC: S.

Hi Michael thank you for replying! The setup under UK is default S-GB and ES-GB for exports. We thought of changing ES-GB to O-GB for international sales, with this we should only have other EU countries to worry about. But since multi-shipping is turned on for our other company locations, we are not able to change it. This is a glitch and is being sent to Netsuite.

So I understand the Derived tax code is only used for EU tax determination, I haven’t looked into other uses for it as of yet. My understanding is that it’s the tool used to link standard and eu tax codes, so that generic (non-eu) tax schedules can be uses, whilst still generating the EU tax codes!

Hi Michael this is great! However, with using nexuses we found that the customer country's tax codes are suddenly all available in Netsuite and are being used by the system. We posed a sample question to our our tax consultant: Example: selling services to Netherlands Should the system use EZSS-GB (from UK’s standpoint) or should it use ESSP-NL (from Netherland’s tax codes)? In case the sale of services is subject to reverse charges, should the system use EZSS-GB (from UK’s standpoint) or RC-NL?

The suffix of the derived tax code should represent the Selling Subsidiary country/nexus. For example selling from uk should be S-GB, or selling a service to the Netherlands should be EZSS-GB. In regards to the RC, you would have to discuss with the business on what the requirement is - I suspect the EZSS-GB tax code would have the Reverse Charge tax code checked, hoowever I can’t recall without testing!

Customer cards only have 1 space for Tax ID. However if we're selling to another ship-to country for the same customer, the EC sales report uses the first two letters of the VAT number and cross-references this to the actual ship-to country and returns an error (blue error meaning "Customer without valid VAT ID/Shipping address").