Foreign currency and the reverse charge
Invoice in euros or another currency, and to EU businesses under the reverse charge.
Step by step
- Pick the customer. For a customer in another EU country, an information box explains the VAT treatment.
- Change “Currency”, for example to EUR. The rate of the taxable supply date appears and can be typed over; the summary adds the VAT and the total in the account currency.
- Under “More options”, “Show the IBAN” is automatic for a foreign currency.
- For a business in another EU country, turn on “Reverse charge” in “More options”. The “EC sales list code” is 3, a service, unless you pick 0, 1 or 2 for goods. A domestic reverse charge takes a “Supply code” instead. The invoice then says that the customer accounts for the VAT, and carries no VAT recap.
- Choose “Create the invoice”. The issued invoice keeps its rate and the reverse charge.
Good to know
A rate you type by hand stays on the invoice. Clearing it returns to the automatic rate.
The invoice takes the rate published for its taxable supply date: the ČNB rate, or the ECB rate for a euro account. Before that day’s rate is out, at 14:30 Prague time for the ČNB and at 16:00 for the ECB (UTC+01:00 in winter, UTC+02:00 in summer), the invoice is refused with the time to issue it again, and stays a draft.
An EU reverse charge needs VIES to confirm the customer’s VAT ID as the invoice is issued, and a Northern Ireland number (XI) needs HMRC. When the register says the number is not valid, or does not answer, the invoice is not issued and stays a draft: check the number, or issue it again when the register answers.
Related articles
- Issue an invoiceFrom an empty form to an issued invoice with its number, PDF and ISDOC.
- The web invoiceEvery issued invoice has its own page your customer opens from the e-mail.
- Billing details, VAT mode and defaultsWhat every document says about you, whether it carries VAT, and the values a new document starts with.