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- Click Create to create a new Input VAT Transaction.
- In the Company field, select or create a virtual company for recording tax adjustments (for instance, Apportionment Adjustments).
- Select Reverse Charge (Inventory) as transaction type to adjust the VAT for imported goods or Reverse Charge (Services) to adjust the VAT for services.
- Select Decrease as adjustment type.
- Select the Generate GL Transactions check box.
- Make sure the correct entity is selected in the Entity field.
- Select the department associated with the transaction.
- Below the Basis field, notice the link in blue font that presents information about the currency, its exchange rate, price type, and taxation option. Make sure Prices Include VAT is selected as the taxation option. Otherwise, click the link to open the Prices and Currency dialog box and select the option.
- Click Save to record the document.
- On the Inventory and Services tab, click Add to add a new line.
- In the Contents column, type a brief description of the transaction, for instance, "Period-end adjustment (services)".
- In the VAT Amount column, enter the VAT adjustment amount which will decrease the reversed VAT, notice that you you don't have to enter any figure in the Amount column.
- Save and post the document.
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