Re: [ubl-dev] Basic Invoice Exploration

[Stephen Green <stephengreenubl@gmail.com>]

Interesting one about the meaning of 'net'.
In the same context, in the UK at least it is generally
accepted practice to call the pre-tax (pre-VAT) total
'nett' and the tax-inclusive, final total 'gross'. I don't
know whether some confusion has resulted from that.

I only have experience with paper invoices and XML
ones (not EDI) and I hadn't come across the term
'line extension' before joining the UBL TC. To us UK
paper invoice people there are two main totals on
the invoice - nett total and gross total with amounts
for total tax (split by tax type and, for VAT, tax rate)
and total discount/charges before VAT and total
for discount/charges after. The total of discounts and
charges taken after the VAT calculation is usually
a varying one, hence it does not get included in the
VAT which must be fixed and cannot be changed
without cancelling and reissuing the invoice - in UK
that is where VAT is sometimes claimed back by
the payer and therefore has to be the same when
claimed back as it is when paid by the supplier.
I don't quite remember all that well but I think the
nett total is one which includes any pre-VAT discounts
and charges so that it is easy to check the VAT
calculation (and ask for a replacement invoice if it is
incorrect - or a correctional credit note or whatever
if the invoice was already paid).

So I too would be interested to know whether line
extension amount includes VAT, having always assumed
that it didn't. What did the UBL invoice examples say?
I wrote some of the examples for UBL 2 but the UBL 1
ones were already pretty much written before I came
along. As were the terms like line extension amount.

Best

Steve

Stephen D Green



2009/6/22 G. Ken Holman <gkholman@cranesoftwrights.com>:
> Forgive me, Steve, for drawing this out but I've got my UBL Human Interface
> Subcommittee (HISC) hat on today.
>
> Since April 2006 in the HISC we've been talking about documenting sample
> calculation models for UBL:
>
>  http://markmail.org/message/7yzrxwp7ttwleyn6
>
> I'm finally talking with a chartered accountant in Canada regarding a
> calculation model for invoices in Ontario Canada (our provincial
> jurisdiction).  It would be an HISC example of a model where VAT is not
> included in prices.
>
> The Danish have documented a calculation model where VAT is included in
> prices:
>
>  http://www.oioubl.info/guidelines/en/OIOUBL_GUIDE_TOTALS.pdf
>
> I would like to transcribe the essentials of that into an HISC document of
> an example model where VAT is included in prices.
>
> Your comments to jaymuz would be helpful to consider when writing this.
>
> Where I'll get the time I don't know, but for three years now we haven't had
> any volunteers join up in HISC and write these up.
>
> At 2009-06-18 11:58 +0100, Stephen Green wrote:
>>
>> My knowledge is a bit rusty (I've been out of finance work
>> for a year or so now) but I think the LineExtensionAmount
>> is the amount without VAT.
>
> LineExtensionAmount is in the InvoiceLine ... so even if the sticker price
> includes VAT, the InvoiceLine LineExtensionAmount is still the price without
> VAT?
>
> LineExtensionAmount is also in the MonetaryTotal ... where it states it is
> the total of line extension amounts net of tax.  Being a programmer and not
> a businessman, I looked up the term "net of tax" and found:
>
>  http://www.answers.com/topic/net-of-tax
>
> Which implies to me that "net of tax" *includes* all tax.
>
> Taken together would imply a contradiction to me that LineExtensionAmount in
> the InvoiceLine is without tax yet LineExtensionAmount in the MonetaryTotal
> is with tax.
>
> Where is a layman like me getting confused?
>
>> The VAT is calculated (in my
>> country at least - UK) on the total including allowances
>> and charges (except those made dependant on payment
>> terms like charges for late payment which do not affect
>> the VAT calculation).
>
> Is the VAT then calculated on the individual invoice lines and the total
> included in the monetary total?
>
>> Also in UK I think it is still true that
>> the VAT cannot be altered once it is declared on an
>> invoice so there are some things the LineExtensionAmount
>> has to include and some things it doesn't. Anyway, AFAIK,
>> it is the basis for VAT calculation so it doesn't itself
>> include the VAT.
>
> Which LineExtensionAmount?  Both?
>
>> All this is general accounting knowledge
>
> (by those who know accounting)
>
>> so doesn't get dicated by the language (UBL in this case)
>> and does have to comply with whatever VAT rules apply
>> to your invoice. I do accept that concepts like LineExtension
>> have been floded into UBL and need a UBL explanation for
>> what they entail - which I guess is at present just in the
>> official UBL semantic definition (a bit sparce - could maybe
>> be extended to include a general conceptual calculation
>> model, albeit one which might have to be a default which
>> gets overridden by local customs and rules).
>
> Hopefully with HISC publishing a couple of examples, then users in different
> jurisdictions will identify what has to be identified where they are.
>
> Thanks, Steve, for all your input!
>
> . . . . . . . . . Ken
>
> --
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