How to Issue a VAT receipt automatically on receiving money

[djmred]

Hi, I have a company website that sells products from its site and uses Paypal as the transaction manager (ie receives the money). I need to be able to send a VAT receipt to the buyer. Can this be done by Paypal?

I've every pdf ever put on Paypal's help section and none mention what to do.

Do I set a VAT rate up and Paypal automatically charges it every time I receive money and it shows up in the Invoice they see in their account summary, or do I set up an invoice templete with the VAT rate selected in the VAT section of the invoice but have to manually type each invoice from this and send it manually? Is it included in one of the emails Paypal sends out like 'Please pay now' invoice, also if so how do I set up automated invoice sending out if its not already automatic

Cheers in advance for any help

Ed.

[PayPal_david]

Hi there Djmred,

At the moment, there is no option to issue a VAT receipt to a customer who purchases an item from you. If you have VAT rates set up to be applied on your transactions, this may be as good as a VAT receipt as it will show the VAT rate that your buyer would have paid on the receipt when they receive it.

You can customise the VAT rate charged on your sales from your PayPal account. Your shopping cart software can take this rate and add it to the final price of your sales.

PayPal won’t charge VAT on your payments unless you select this option and specify a rate.

To select this setting on your account:

1. Log in to your PayPal account at www.paypal.co.uk
2. Click ‘Profile’ near the top of the page.
3. Click ‘My selling preferences’.
4. Under ‘Selling online’ click ‘Update’ next to VAT.
5. Click ‘Add New Sales Tax’ in the Domestic or International section to add a new rate.
6. Enter the rate and click ‘Continue’.
7. Repeat steps 5 and 6 for each new rate needed.

Any rates you add can be edited or deleted at any time.

This should also result in your buyers paying VAT any time an item is purchased from you. 

Please let me know if there is anything else you need.

David.

[djmred]

Hi, thanks for your concise reply. I will try it out and come back and mark as accepted answer + kudos.

Thanks.

[fivepointtwo]

Following on from this - if my shop uses Paypal as a checkout system and I follow the instructions for adding VAT, my advertised price is not then the final price as customers will be asked to pay the advertised price + VAT on top.  

This is standard practice on business to business transactions, but I'm selling to the general public and it doesn't really sit well, in that my advertised price must be inclusive of VAT.  

Is there any way of adding a VAT line to the Paypal invoices my customers receive that is calculated off the advertised price?  

That is to say, if I sell an item for £2, is there a way that I can show that the VAT paid on the £2 item is 33p (at a 20% rate), rather than have the customer be asked to pay £2.40 at checkout for a £2 item?  (resulting in said customer never to be seen again!!)

Thank you very much.