proalpha News Important Information for Accounting Regarding the Turn of the Year 2015/2016

Transcription

1 proalpha News Important Information for Accounting Regarding the Turn of the Year 2015/2016

2 Table of Contents Table of Contents 1. Introduction Germany Sales Tax German BilRUG (Law to Implement Accounting Directives) IBAN Austria Sales Tax Advance Sales Tax Return XML Export Italy Investment Promotion through Increased Depreciation Allowance Hungary Sales Tax Exporting Accounts Receivable Disclaimer proalpha informs - Regulatory changes in accounting.docx Page 1 (13)

3 Introduction 1. Introduction This document provides information about relevant changes in accounting which take effect as of Each chapter deals with a different country. The following countries are concerned: Germany Austria Italy Hungary 2. Germany 2.1 Sales Tax Since 2005, sales tax returns and advance sales tax returns have to be processed electronically with ELSTER. Software providers can automatically create these returns in the respective system by using the Elster Rich Client (EriC) library. Structural modifications have been made here, which are contained in the year-end update in proalpha. Installing the update is a requirement to electronically transmit the advance sales tax return and VAT information exchange report for 2016 and the sales tax return for Moreover, new tax rates apply in the following countries as of January 01, 2016: Austria: The reduced tax rate will be increased from 10% to 13% for certain sales (e.g. generated from domestic flights, entrance fees for cinemas and swimming pools); the tax rate of 12 % will be removed. Norway: The reduced tax rate will be increased from 8 % to 10 %. Romania: The standard tax rate will be reduced from 24 % to 20 %. In France, the tax threshold for mail order selling will be reduced from EUR 100,000 to EUR 35,000 at the turn of the year. What you need to do in proalpha: Configure new tax codes if your company is registered for sales tax. Assign the new tax codes to the respective G/L accounts. Adjust the revenue and purchasing groups concerned. Adjust the tax threshold for France. Page 2 (13)

4 Germany 2.2 German BilRUG (Law to Implement Accounting Directives) The EU directive 2013/34/EU was implemented in German law with BilRUG on July 17, BilRUG is again a major change to commercial laws and part of the initiative to harmonize the European legal framework by making annual reports and financial statements provided by company groups comparable throughout Europe. BilRUG has a significant impact on balancing and reporting. The changes apply to annual reports after December 31, 2015, and have three major effects: Monetary threshold values are increased, and sales revenues are redefined. Various documentation and disclosure requirements will be specified more clearly and extended. Corporate disclosure will include a report on payments to authorities. For individual financial statements, the threshold values of size classes for corporations will be increased. The following table shows the new thresholds as per section 267 of German HGB: Size Classes for Corporations Balance Sheet Total k Sales Revenues k Number of Employees Previous Now Previous Now Previous Now Smallest Small Medium Large >19,250 >20,000 >38,500 >40,000 >250 >250 As before, the data of two successive fiscal years are required to define the size class. Two out of three features have to apply (section 267, paragraph 4 of German HGB). Initially, companies were to be given the right to choose whether they wanted to apply the new size classes to their commercial annual reports as of 2014 retrospectively. However, this would have caused problems with the e- balance, which is why this right of choice was not given. While the new thresholds for corporations are likely to have only little effect in practice, the redefinition of sales revenues presents a major challenge: Section 277, paragraph 1 of the new version of German HGB now stipulates the following according to German BilRUG: The following have to be classified as sales revenues: revenues from selling, renting and leasing products as well as from services provided by the corporation after revenue reductions, sales tax and other tax directly related to sales have been deducted. Page 3 (13)

5 Germany As a result, deliveries and services rendered are no longer classified as "ordinary business". According to the new definition, the following business transactions belong to sales revenues: Sale of products (fixed assets excluded other operating income) Earnings from rentals and leases Provision of services The structure of the profit and loss statement according to section 275 of German HGB will also be changed. The items of extraordinary earnings and extraordinary expenses as well as extraordinary income will be removed. Size Classes for Corporations Balance Sheet Total k Sales Revenues k Number of Employees Previous Now Previous Now Previous Now Smallest Small Medium Large >19,250 >20,000 >38,500 >40,000 >250 >250 What you need to do in proalpha: Configure new revenue accounts for the accounts used so far for extraordinary expenses and earnings. Alternatively: Rename the account descriptions used so far. Define new analyses and assign the new revenue accounts to the respective analyses (P&L, MgA, etc.) Alternatively: Regroup the revenue accounts used so far in new analyses for comparisons to previous years. The law also places new demands on larger companies with respect to reporting and notes to financial statements. To comply with BilRUG, several steps need to be taken. The most important changes are listed in the following: The currency conversion as per section 284, paragraph 2, number 2 of German HGB no longer needs to be specified. More details are required in fixed asset analyses: In addition to the data provided up to now, changes in depreciation related to acquisitions, disposals and transfer postings have Page 4 (13)

6 Germany to be specified as an amount. Moreover, it has to be specified for each fixed asset how interest for outside capital was included in the manufacturing costs of the fiscal year (section 284, paragraph 3 of the new version of German HGB). Sales revenues have to be divided by activities and geographical markets if these differ greatly with respect to the organization of selling, renting and leasing products and of providing services by the corporation (section 285, number 4 of the new version of German HGB). Taxes on extraordinary income do not have to be specified (section 285, number 6 of German HGB). The period over which purchased goodwill is depreciated has to be explained (section 285, number 13 of the new version of German HGB). In addition to the data on deferred taxes provided so far, the deferred tax balances at the end of the fiscal year have to be specified as well as the changes made to these balances in the balance sheet during the fiscal year if the balance sheet involves deferred tax liabilities (section 285, number 30 of the new version of German HGB). The amount and the type of extraordinary revenues and expenses have to be specified and explained, provided they are not of minor importance (section 285, number 31 of the new version of German HGB). Explications of the amount and type of individual expense and revenue items which belong to another fiscal year have to be specified, provided the amounts are not of minor importance (section 285, number 32 of the new version of German HGB). 2.3 IBAN As of February 2016, the IBAN will replace the account number and bank routing number. However, these numbers will not be omitted completely because they keep being a part of the 22-digit IBAN in Germany. Since the use of the IBAN is obligatory in the Euro zone, a bank identifier code (BIC) no longer has to be specified as of February. Page 5 (13)

7 Austria 3. Austria 3.1 Sales Tax The standard tax rate in Austria is 20%. There is also a reduced tax rate of 10% for selected products as well as a tax rate of 12% for farm gate sales of wine. As of January 2016, a tax reform will become law: The tax rate of 12% will be removed. A new reduced tax rate of 13% will be introduced. The new tax rate of 13% will apply to certain sales which were subject to the sales tax of 10% before. The following list contains the most important cases where the new reduced sales tax of 13% applies: The shipment, import and personal use of the items listed in lines 1 to 13 of the attachment 2 of the VAT act. These include: live animals such as donkeys, cattle, pigs, sheep, goats, poultry and others, plants and flowers, residues and waste of the food industry, animal and vegetable fertilizers as well as firewood, collector's items, and antiques. As of May 01, 2016, the sales tax of 13% also applies to accommodating persons in furnished living rooms and bedrooms and to related ancillary services. In case of package offers, a decree will define the share applied to breakfast, full and half board since this share is still subject to the reduced tax rate of 10%. The rental of campsites; with the prerequisite that a uniform usage fee is charged for the services offered. Theater plays, musical and choral performances as well as services offered by museums, provided they are not organized by regional corporations or non-profit organizations. These services are subject to the new reduced tax rate as of May 01, Entrance fee for sport events (the standard tax rate is reduced). Sales from swimming pools and heat therapy. Passenger transport by aircraft. What you need to do in proalpha: Create new tax accounts, cash discount accounts, write-off accounts, and other for the sales tax of 13%. Configure new sales tax and prepaid tax codes for the sales tax of 13% and assign the new accounts. Assign the new tax codes in the revenue and expense accounts concerned. Add the master files for purchasing and revenue groups. Page 6 (13)

8 Austria 3.2 Advance Sales Tax Return Due to these changes to the tax rates, there will be a new form (U-30) for the advance sales tax return as of The form encompasses four pages. Modifications of the previous structure are highlighted in color. Page 1 Page 7 (13)

9 Austria Page 2 Page 3 Page 8 (13)

10 Austria Page 4 What you need to do in proalpha: Update the account assignment for the advance sales tax return. Scope of the update in proalpha: New form U-30 for the advance sales tax return Use of the new form for checks before a final XML file is generated Page 9 (13)

11 Austria 3.3 XML Export The changes to the sales tax are also reflected in the XML file. The modified structure is in the scope of the year-end update. The following screenshot shows the proalpha dialog to create the output file: Implementation in proalpha: When the calendar year is entered, the XML file is automatically output with the correct structure. Calendar year 2015 XML file is created with the structure valid in 2015 Calendar year 2016 XML file is created with the structure valid in 2016 Advance sales tax returns for 2015 and 2016 can thus be created in parallel. Page 10 (13)

12 Italy 4. Italy 4.1 Investment Promotion through Increased Depreciation Allowance One of the most essential features of the Stability Law 2016 is an investment promotion for the purchase of certain fixed assets. It allows businesses to write-off another 40% in addition to the top limit of 100% stipulated by law for procurement and manufacturing costs. The so-called "Super Depreciation", or "Superammortamento", can be used under the following conditions: New assets / used assets are exempt from the promotion Airplanes, power lines, gas pipes, and railroad cars are also exempt Assets acquired between October 15, 2015 and December 31, 2016 Fixed assets with a depreciation rate of > 6.5 % p. a. What you need to do in proalpha: Enable the FAA function "Depreciation Under 0" Set up a new depreciation method "Superammortamento" Define a factor for linear depreciation: 1.40 Set up a second level for the finalization of the depreciation when the top limit of 140% is reached Page 11 (13)

13 Hungary 5. Hungary 5.1 Sales Tax Good news for Hungary: There are no tax increases for the year And that's not all: For accounting, the prerequisites for a so-called simplified year-end closing have been adjusted. The threshold value for the balance sheet total has been increased from HUF 500m to HUF 1,200m and the threshold value for sales revenues from HUF 1bn to HUF 2.4bn. The threshold value for the average number of employees remains 50. To create a simplified annual report, at least two of the three threshold values mentioned above must not have been exceeded in the last two fiscal years. 5.2 Exporting Accounts Receivable As of 2016, all software used for the creation of accounts receivable has to feature a function for exporting all invoices into one XML file. Upon request, the structured export has to be provided to the National Tax and Customs Office (Nemzeti Adó- és Vámhivatal, or short "NAV") on a data carrier. This request is usually made during an audit effected by the tax authorities. This way, the contents of the invoices can be efficiently checked. There is no regular obligation or a fixed deadline for an XML export to be provided to the tax authorities. In this respect, the following modifications were made in proalpha: The Sales Invoice menu was given a new menu item: "Adóhatósági ellenőrzés adatszolgáltatás" ("Data Export for Auditor"). In the corresponding option dialog, you can choose the data to be selected. Then you can select the directory in which the file is to be stored. The name of the file is structured in the following way: "NAVDAT" + yy.mm.dd + ".xml". The file contains the following pieces of information: Information on the invoicing party and the invoice recipient Information on the line items of the products/services Miscellaneous (remarks, payment periods, currency, etc.) A final list of the totals for determining the tax value, counter value and determination base. Page 12 (13)

14 Disclaimer 6. Disclaimer This document is intellectual property of proalpha Business Solutions GmbH. It may not be disseminated, reproduced, published or used in any other electronic or printed publication without the prior written consent of proalpha Business Solutions GmbH. The contents of this document have been created with utmost care. proalpha cannot be held liable for the currentness, correctness and completeness of the information provided, nor for any damage caused due to the use of these recommendations or for any actions taken on the basis of the information provided. The information in this document is not binding and does not represent any legal advice nor can it replace any legal advice. Page 13 (13)