When you register your business as VAT-liable, Holvi helps by giving you an overview of your VAT balance – so you know how much money to set aside for taxes. How does this work?
Is your business VAT-liable?
If your business is VAT-liable and you haven’t already set up VAT, follow the instructions on this page to start simplifying VAT payments.
How Holvi’s bookkeeping categories calculate your VAT
Whenever money moves through your Holvi account – either as an inbound or outbound transaction – Holvi will prompt you to assign a VAT percentage. Based on whether this transaction is income or expense, Holvi automatically sends the assigned percentage of the transaction to a VAT payable or VAT receivable category.
How to add VAT to inbound payments (income)
To add VAT to an inbound payment, select the payment you received and click Edit. This opens up your transaction details, where you can add VAT for each item.
The VAT percentage will automatically be categorised as VAT payable, and your VAT balance will update accordingly.
How to add VAT to outbound payments (expenses)
To add VAT to an outbound payment, open the transaction in the Holvi app. Snap a photo of the receipt, categorise the expense, then add VAT and any bookkeeping notes.
The VAT percentage will automatically be categorised as VAT receivable, and your VAT balance will update accordingly.
How does Holvi calculate your VAT balance?
If you sell a product for €1,000 with 24% VAT, for a total price of €1,240. Your VAT payable will update to €240, VAT receivable will stay at €0.
Next, you pay a €100 invoice with 24% VAT, for a total price of €124. Your VAT payable will update to €216 and VAT receivable will stay at €0.
You can view your overall VAT balance based on VAT payable and VAT receivable category balance any time on Holvi’s home screen.
Pro tip – For accurate calculations
For an accurate estimation and proper accounting, make sure to add all your business transactions to Holvi, along with their corresponding VAT.