You define input VAT codes in Customizing for Financial Accounting (FI), by choosing Financial Accounting Global Settings ® Tax on Sales Purchases ® Calculation ® Define Tax Codes for Sales and Purchases.

You define separate tax codes for posting the deferred tax when you first enter the VAT (value-added tax) ("original tax codes"), and for transferring these taxes to the target tax account once you have paid the tax ("target tax codes").

You also define other tax codes for entering VAT from foreign invoices, that is, to post united customs declaration to foreign invoices.

Set up the account determination in Customizing for Financial Accounting (FI), by choosing Financial Accounting Global Settings ® Tax on Sales/Purchases ® Basic Settings ® Slovakia ® Specify Accounts for Deferred Tax.

When you enter a vendor invoice (or any other document including input tax), assign it the appropriate original tax code.

If the tax does not need to be deferred – for example, if you pay for a purchase by cash – you can assign the appropriate transferred tax code to it instead. Alternatively, you can define separate tax codes for these purposes.

When you run the Deferred Tax program, it checks the tax items with an original tax code, and if you have paid them, it assigns them a deferred tax code instead. You can thus offset these items against your output tax.