Tax rates

Tax rates are the percentages of value added tax (VAT) that are applied on the sale of goods and services. Tax rates follow international standards, and cross border sales can be invoiced tax free using the Reverse charge option located on the customer card's Customer settings page and directly on the invoice in the Detailed information section.

Settings > Organization > Company settings > Tax rates page allows you to manage tax rates. Add here all tax rates needed in your company. The default tax rate selected here will be used on new invoices unless another tax rate is selected manually. Editing these settings requires administrator rights.

In Finland, the general value added tax rate changes from time to time. When this happens, the change always requires actions in Severa from every Finnish company. Carefully read the up-to-date instructions related to taxation at vero.fi before making any changes in Severa.

The vat rate affects different targets in Severa in different ways:

1. Work hours always use the company default tax rate defined in the company settings. Invoice the work hours that must be invoiced with the old tax rate before you change the company default vat percentage in the settings.
2. Products and fees use the vat percentage defined in their settings in the product registry (a product either uses the company default vat percentage or a separate tax rate selected manually for it).
3. Travel expenses use the vat percentage defined in their settings in the travel expense registry (a travel expense either uses the company default vat percentage or a separate tax rate selected manually for it).

Updating the vat rate in the company settings does not affect products and travel expenses to be invoiced retroactively. The tax rate of products already added to a project must be edited manually.

To use a new tax rate, add it manually to the settings. Go to Settings > Organization > Company settings > Tax rates and add the new tax rate.

In Severa, one tax rate is always set as default and it is used on all new invoices unless another tax rate is selected manually. You can change the default tax rate by going to Settings > Organization > Company settings > Tax rates. Click the tax rate to edit it and set it as default.

Go to Settings > Work hour, travel expense and product registries to update the vat information of products and fees as well as travel expenses.

Add Invoicing vat from the Columns section to the product list so that you can easily see the products for which vat has been set manually to the old tax rate. If the field is empty, the product uses the company default vat percentage defined in the company settings. Sort the product list by clicking the Invoicing vat column so that you can easily see the products whose vat rate must be updated.

The mass update function opens when you activate the checkbox on the product category header row. If several product categories are in use, we recommend updating the vat information one product category at a time.

You can easily update the vat rate of fees waiting for billing with the mass update tool in the Reporting section.

1. Go to Reports > Report creation.
2. Select Financials.
3. Open Fees > Items report to update products and travel expenses.
   • Select Invoiced: No as a filter on the right to see all products that have not yet been invoiced.
   • Add VAT % from the Values section as a column in the report to see which products’ vat rate must be updated.
4. Select the products by activating the checkboxes.
5. Select Update vat from the top menu and update the tax rate to the correct one.

If you are using Severa Platinum or Enterprise edition and you invoice recurring fees from projects, you can update the tax rate of recurring fees in one view with the mass update tool. Access to the tools requires administrator rights.

1. Open the cogwheel icon in the upper right corner of Severa.
2. Go to Tools > Recurring fees.
3. Add VAT % as a filter and select the old tax rate to be discontinued to see only the fees that require an update.
4. Select the fees by activating the checkboxes.
5. Select Update vat from the top menu and update the tax rate to the correct one.

If you do not have the mass update tool, you can update recurring fees from the project project financials section. We recommend that project managers check the situation of their own active projects and update the fees.

If you have set the customer default invoicing vat manually instead of using the organization default, update customer details via the Reporting section.

1. Go to Reports > Report creation.
2. Click Customers and open the Customers report.
3. Add Default invoicing vat as a filter and select the old tax rate to see the list of customers that need to be updated.
4. Select the customers by checking the checkbox on the header row.
5. Select Change default invoicing vat from the top menu and update the tax rate to the correct one. You can either select the vat manually or use the company default (inherited from company's settings).

Keywords: tax rate, tax percentage, vat, vat rate, taxation, invoice tax rate, invoicing tax rate, vat change, vat rate change, default tax rate, default vat rate

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