From April 2015, the way that VAT should be calculated when raising an Invoice has changed. Please see VAT on discounts topic for further information before reading this topic. The details in this topic are, in part, superseded but have been left as-is for legacy reasons.

When the Purchase Remittances window is displayed, if a Settlement Discount has been entered for an Invoice, and the qualifying date is earlier than the 'as at' date entered on the previous window, then:

The Discount percentage will be displayed in the list, in the column headed by Set%.

The value of the Discount will be displayed at the bottom of the list, in the Settlement Discount box, when the transaction line is highlighted.

The system allows two Discount levels to be entered for each invoice, for example:

2.5% discount if paid within 7 days, or just 1% discount if paid within 14 days.

The system will display the correct level of Discount in the Remittance list, reducing from 2.5% to 1% when the Invoice is more than seven days old and then reducing to zero % when the Invoice is more than 14 days old.

If a discounted line is selected the Discount figure shown can be edited to any value between zero and the full value of the transaction.

The bottom of the window displays a running balance of total Payment and total Discount for the Remittance.

Clicking the button once will clear any Settlement Discount already displayed.

Clicking a second time will re-display any Discount it has previously cleared.

Clicking the button once will enter the Dispute flag for all Invoices displayed.

Clicking the button a second time will clear the Dispute flag for all Invoices displayed.

Purchase Invoices can be flagged as ‘in dispute’ when they are entered. Disputed Invoices:

Update Supplier Accounts, VAT records, the P&L and Balance Sheet in the normal manner, but they cannot be selected for Payment or Allocation until their Dispute status is removed.

Do not display a Settlement Discount as being available in the Remittance list, and double clicking upon them within the Remittance list will have no effect.

The system displays the value still outstanding to be Allocated, for each Transaction in the list. It also shows the highest Settlement Discount percentage available - this may be nothing if the Invoice is old.

Invoices that are in Dispute are marked with an ‘*’, they do not show Discount as being available, and cannot be selected.

Sort By This menu enables you to sort the list by Account Code, Date Ascending, Date Descending, Audit No. and Reference. The default when the window opens is Account code.

There are several ways in which you can Allocate Transactions:

Toggle changes the status of the selected Transaction, or all Transactions displayed in the list window.

Individual Transactions can be selected for allocation, and:

either: double-click on them in the list to allocate their entire value.

or: single-click to select them, and then enter the required value in the Allocated Value field.

You can click on the Account button, and display a list of the Suppliers.

Double-clicking on a Supplier in the list allocates all of their Transactions.

Negative Settlement Discount is not calculated on Credit notes that are sent to you by Suppliers that offer you Settlement Discount terms.

If a Supplier sends you a Credit note for part of an invoice, then you are not entitled to take the full amount of the Settlement Discount shown on the original Invoice.

Because VAT is calculated when raising an invoice, Settlement Discount relates to gross outstanding rather than net.

If the Credit note is allocated against the Invoice via the Allocations window, then the outstanding amount of the Invoice will be shown in the Remittance window. However the Settlement Discount percent will not be shown in the list and the amount of Settlement Discount to be taken will need to be calculated & entered manually.

If the Credit note is being allocated as part of the Remittance run, then the amount of Settlement Discount being taken against the original invoice will also need to be reduced manually.

In the case of Sales Ledger/Sales Order Credit notes being raised for Customers for whom you offer Settlement Discount terms, it is recommended that instead of partial Credit notes being raised, that a Credit note for the full amount of the Invoice is raised and then the outstanding value re-invoiced. This will prevent your Customers trying to take the full amount of Settlement Discount as shown on their original Invoice.