Handling Reverse VAT (Reverse Charge) in Accounting

Reverse VAT overview

The Reverse VAT (reverse charge) shifts VAT reporting from the seller to the buyer.
Common scenarios:

Cross-border B2B sales within the EU
Domestic transactions for specific goods/services
Imported services from non-EU suppliers

Under reverse charge:

Seller does not charge VAT
Buyer self-assesses VAT, creating both input and output VAT entries
Net VAT to pay is usually 0, but declaration is ensured

1. Reverse VAT with `create invoice`

When using the invoice endpoints, Chift handles the reverse VAT accounting automatically.

1.1 Purchase invoices (`supplier_invoice`)

For invoices subject to reverse VAT:

No VAT is charged on the invoice (tax_amount = 0)
Assign the appropriate reverse VAT tax code with reversed = true
tax_rate is the applicable VAT rate (used for self-assessment)

Chift’s API will automatically generate two VAT ledger entries:

Output VAT (as if the buyer had issued the invoice)
Input VAT (as if the buyer had paid it)

These entries offset each other, so no VAT is paid, but both are properly declared in the VAT return.

Example — purchase invoice

{
  "invoice_type": "supplier_invoice",
  "invoice_number": "SUP-INV-778",
  "currency": "EUR",
  "untaxed_amount": 2000,
  "tax_amount": 0,
  "total": 2000,
  "reference": "Consulting services from UK supplier",
  "invoice_date": "2025-07-05",
  "due_date": "2025-08-05",
  "partner_id": "supp-789",
  "journal_id": "abcpurchjourid",
  "lines": [
    {
      "line_number": 1,
      "quantity": 1,
      "untaxed_amount": 2000,
      "tax_rate": 21,
      "tax_amount": 0,
      "total": 2000,
      "account_number": "604000",
      "tax_code": "REV-IMPORT-SERVICES",
      "description": "Consulting service - Reverse VAT applicable"
    }
  ]
}

1.2 Seller side (sales invoice)

For sales invoices under reverse charge, the treatment is simpler:

Do not charge VAT (tax_amount = 0, tax_rate = 0)
Use the appropriate 0% tax code corresponding to the reverse-charge scenario (not necessarily marked reversed)
Total = net amount, no VAT included

Example — sales invoice (minimal)

{
  "invoice_type": "customer_invoice",
  "invoice_number": "INV-2025-001",
  "untaxed_amount": 1000,
  "tax_amount": 0,
  "total": 1000,
  "lines": [
    {
      "line_number": 1,
      "quantity": 1,
      "untaxed_amount": 1000,
      "tax_rate": 0,
      "tax_amount": 0,
      "total": 1000,
      "tax_code": "REV-EU-B2B"
    }
  ]
}

2. Reverse VAT with `create journal entry`

Journal entries work differently from invoices. With invoices, Chift derives accounting entries automatically. With journal entries, you are directly providing the accounting data, so reverse VAT must be explicitly described.

2.1 Purchase-side reverse VAT

For purchase reverse VAT:

tax_info must be attached to the expense line
tax_amount should be calculated as:
amount excl. tax × VAT rate linked to the tax code and must not be zero
vat_account should typically be the deductible VAT account returned by the Get VAT Codes endpoint
reversed_vat_account should typically be the payable VAT account returned by the Get VAT Codes endpoint

Example

{
  "reference": "Reverse VAT purchase",
  "journal_id": "HA",
  "currency": "EUR",
  "date": "2026-05-05",
  "items": [
    {
      "account_type": "supplier_account",
      "account": "SUP21",
      "credit": 100
    },
    {
      "account_type": "general_account",
      "account": "601000",
      "debit": 100,
      "tax_info": {
        "tax_code": "445621$445200$021",
        "tax_amount": 21,
        "vat_account": "445621",
        "reversed_vat_account": "445200"
      }
    }
  ]
}

This is different from create invoice.Even though the supplier invoice itself contains no charged VAT, the journal entry must explicitly provide the VAT amount so Chift can generate the reverse VAT postings.

2.2 Sales-side reverse VAT

No specific reverse VAT handling is required. Create the journal entry as a normal VAT-exempt sale.

VAT ledger accounts logic in France

Some accounting software does not expose VAT codes through their API — or does not use them at all. In these cases, Chift reconstructs VAT codes artificially from the VAT ledger accounts (accounts starting with 445) in order to keep the data model consistent across all connectors. The behavior is identical for the API consumer regardless of the underlying system.There are two scenarios:

The accounting software supports VAT codes (and exposes them via API) → no special handling required.
The accounting software does not have VAT codes (or they are not accessible via API) → Chift infers the VAT code from the 445x ledger accounts present on the transaction, using the following logic:

Sales

VAT Type	Ledger Account(s)
Standard	`44571` or `44572`

Purchases

VAT Type	Ledger Account(s)
Standard	`44566` and `445664`
Fixed assets (Immo)	`44562`
Intracom – Reverse charge	`445662` or `445665`+`4452`
Intracom fixed assets – Reverse charge	`445621` or `445622`+`4452`
Extracom – Reverse charge	`4456698`+`445798`, or `445661`+`4451`, or `445663`+`4453`
Domestic reverse charge (Autoliquidation FR)	`4456699`+`445799`, or `445666`+`445716`

For reverse charge scenarios (Intracom, Extracom, Autoliquidation), the detection relies on a combination of two ledger accounts being present together on the transaction — one representing the output VAT side and one the input VAT side.

✅ Summary

Role	Tax Treatment	Chift API Handling
Buyer —`create invoice`	Self-assess VAT	`tax_amount = 0`, reversed tax code required → API generates offsetting VAT entries
Buyer —`create journal entry`	Self-assess VAT	Through `tax_info`: `tax_amount = amount excl. VAT × rate`, reversed tax code required, `vat_account` + `reversed_vat_account` required
Seller	VAT exempt	`tax_amount = 0`, `tax_rate = 0`, use appropriate 0% tax code

Getting started

Core docs & concepts

Datalayer

API's guides

Handling Reverse VAT (Reverse Charge) in Accounting

Reverse VAT overview

1. Reverse VAT with `create invoice`

1.1 Purchase invoices (`supplier_invoice`)

Example — purchase invoice

1.2 Seller side (sales invoice)

Example — sales invoice (minimal)

2. Reverse VAT with `create journal entry`

2.1 Purchase-side reverse VAT

Example

2.2 Sales-side reverse VAT

✅ Summary

​Reverse VAT overview

​1. Reverse VAT with create invoice

​1.1 Purchase invoices (supplier_invoice)

​Example — purchase invoice

​1.2 Seller side (sales invoice)

​Example — sales invoice (minimal)

​2. Reverse VAT with create journal entry

​2.1 Purchase-side reverse VAT

​Example

​2.2 Sales-side reverse VAT

​✅ Summary

Reverse VAT overview

1. Reverse VAT with `create invoice`

1.1 Purchase invoices (`supplier_invoice`)

Example — purchase invoice

1.2 Seller side (sales invoice)

Example — sales invoice (minimal)

2. Reverse VAT with `create journal entry`

2.1 Purchase-side reverse VAT

Example

2.2 Sales-side reverse VAT

✅ Summary