Why is partial tax not calculating correctly?

This article covers partial VAT recovery not calculating as expected on a purchase invoice. It does not apply to expense documents - partial tax recovery is not supported there; see 'Can I apply partial or non-recoverable VAT on an expense document'.

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Start here: the most common cause

Partial VAT usually calculates incorrectly on a purchase invoice because the Tax Group's Partial Posting Method does not match your organisation's VAT treatment, or because a partial rate has not been set for the date on the invoice. Work through the checks below in order.

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Checking the Tax Group setup

1. In the search bar, type 'Tax Group'
2. Open the Tax Group linked to the legal entity on the invoice
3. Select 'Edit'
4. Confirm 'Partial' is ticked. If it is not ticked, no partial rate will apply, regardless of the Partial Posting Method selected.

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Reviewing the Partial Posting Method

The Partial Posting Method controls how iplicit splits the recoverable and irrecoverable amounts in the General Ledger. Selecting the wrong method will not change the recoverable percentage, but it will change where the irrecoverable amount posts, which is often what looks like an error.

1. On the Tax Group, locate 'Partial Posting Method'
2. Select the method matching your required treatment. Confirm which of the five listed methods increases net cost versus retaining it, since the dropdown wording and the current setup guidance do not agree on this point
3. Check whether 'Non recoverable posting method' also needs setting for this Tax Group, and if so, what it controls separately from Partial Posting Method
4. Save the Tax Group.

For more information on the Partial Posting Method options, see 'Partial Tax | iplicit'

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Checking the partial rate itself

If the posting method is correct but the recoverable percentage is still wrong, the issue is more likely the rate than the method.

1. Open the 'Partial Rates' tab on the Tax Group
2. Confirm a rate exists with an 'Effective from' date on or before the invoice's tax date, and no 'Effective to' date earlier than it
3. Check any conditions on the rate - such as Legal Entity, Account or Cost Centre - match the invoice line in question.

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If only one line on the invoice is affected

If most lines on the invoice are calculating correctly and only one is not, the cause is more likely 'Partial Tax Ignore' being ticked or unticked incorrectly on that line, not the Tax Group. See 'How to apply a partial VAT rate to a single line on a purchase invoice' for how that field works.