Allow invoices to specify tax amounts in a separate currency
UK VAT law requires that invoices present VAT amounts in Sterling, even when the invoice is in a separate currency. As a result, it's possible to have a Euro invoice with Sterling VAT amounts. (See VAT Guide 16.4 and 16.3.1). Obviously when charging the customer, these have to be converted to Euros and the total expressed in Euros, but the business owes VAT in Sterling, not Euros.
Currently it's only possible to specify a single currency per invoice; now, if it were possible to stipulate the exchange rate to be used, that might make matters better, but in general we really need to be able to specify the exact Sterling VAT figure.
Alastair Houghton
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Esthl Simna commented
This is a great discussion about handling VAT in multi-currency invoices! Ensuring compliance with UK VAT laws while maintaining clarity for customers is indeed a challenge. To streamline the process and avoid errors, businesses could benefit from automated tools that handle currency conversions and VAT calculations accurately. For related resources on simplifying administrative and legal processes https://aarrestss.org which provides valuable insights and tools for record management and compliance.