Vouchers and VAT calculation

Vouchers are a great way to promote marketing, but unfortunately they are not easy from a tax point of view. Fortunately, TYRIOS has implemented an automatic system so that our customers have no problems with the correct VAT calculation.

There are basically two types of vouchers:

1. Gift vouchers, which the customer buys in order to then give the voucher to others as a gift.
2. Discount vouchers that the shop owner creates for marketing reasons in order to stimulate sales.

Case 1:

In the first case, a distinction must be made as to whether the voucher is intended for an explicitly named item or not.

1. If it is general, the voucher must be sold without VAT: The applicable VAT rate is simply not yet known at the time.
2. However, if the item is explicitly named or the applicable VAT rate is known in advance, the VAT rate must be calculated when the voucher is sold. Otherwise the applicable VAT rates will be paid to the tax office too late.

If the voucher is now redeemed, a distinction must be made between precisely these cases:

1. If no VAT has yet been charged when the voucher is purchased, the VAT on the items will now accrue unchanged

   Example:
   Article 1: 119 € (19% VAT)
   Article 2: 107 € (7% VAT)
   Voucher: 20€ (0% VAT)

   => Total cost 206€, but 26€ VAT

2. If VAT has already been charged when the voucher was purchased, it must now be deducted. Otherwise too much VAT will be deducted. Fine, the tax office will be happy, but not your wallet.

Case 2:

In addition to vouchers with absolute amounts, percentage vouchers are popular here (e.g. 10% discount). In both cases, the purchase amount is reduced - so there is a price reduction. This must be taken into account accordingly in the VAT calculation. The particular challenge is that - if different VAT rates are used - these must also be taken into account separately.

Example percentage voucher:

Article 1: 119€ (19% VAT)
Article 2: 107€ (7% VAT)
Voucher: 10%

=> Total cost: 119 - 11.90 + 107 - 10.7 € = 203.40€

The VAT rate here is €19 - €1.9 + €7 - €0.7 = €23.40

The voucher must therefore be split into two tax rates. It is incorrect to use a maximum or minimum tax rate:

• Using a maximum tax rate (19% of 11.90+10.70 = 3.61€) would result in a VAT amount of 22.39€. This means that the tax office would receive too little VAT, making the accounting incorrect. This can be very expensive in the event of a tax audit.
• Using a minimum tax rate (7% of 11.90+10.70 = 1.48€), on the other hand, would result in a VAT amount of 24.52€. This means that too much VAT would be paid. Although this pleases the tax office, it significantly reduces the profit.

The problem is similar for vouchers with absolute amounts, but the calculation of the correct VAT amount is even more complicated.

So be careful when using vouchers! TYRIOS automatically recognises the correct calculation.