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VAT - Automatically calculate VAT using the Marginal Scheme

Ability to automatically calculate VAT using the marginal scheme.

Purpose: To easily show correct VAT amounts when VAT is only charged on the Margin between Purchase price and Selling Price.

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AdminXero Team (Admin, Xero) shared this idea  ·   ·  Report…  ·  Admin →
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Not in pipeline  ·  AdminKelly Munro (Community Manager, Xero) responded  · 

Hi team, thanks for the support and interest this idea has gained. Though we appreciate the value auto calculating VAT using the marginal scheme would be for those that need it, we want to be transparent here that this isn't in our roadmap.

Currently, it's possible to adjust VAT on invoices and credit notes - If you set the transaction to Amounts are 'Tax exclusive' and make sure the Tax Amount column is shown you'll be able to click into this field and edit the amount as needed for each line of your invoice - we have more detail on this in Xero Central.

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  • Mark Sharples commented  ·   ·  Report

    We have clients using the second hand margin scheme and would really appreciate a solution.

    The best we have at the moment is to use Products and Services to track stock, set stock items with the same purchase/sale price, then add in the margin at 20% VAT when raising the sale.

    The only thing this solution doesn't cover is the simultaneous release of the box 7 figures when the stock is sold rather than when it is purchased - if this could be implemented (e.g. maybe a switch to release stock items on sale rather than purchase) then the system would work.

  • Tim Vogel commented  ·   ·  Report

    clients moving to sage as this does not exist

  • Roy Brown commented  ·   ·  Report

    I cannot understand why this is not standard VAT functionality in Xero. Not only for car dealers but also any VAT registered company that must use the margin scheme. Xero does so much promotional work about tax being digital then omitted a fundamental VAT scheme. As a Xero champion I thought they wanted to be the best go to accounting software for SME’s Maybe I got it wrong and need to look at other solutions. Be great to here from Xero on this.

  • Rich Beale commented  ·   ·  Report

    VAT Margin Scheme (UK)
    This would be really useful for second-hand cars and antiques businesses. Current this has to be done manually or Xero not recommended

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