Yesterday, the 5th of July, the Independent Authority for Public Revenue (AADE) announced the operational production of the upgraded method of expenditure characterization.
This is about simplifying the way expenditures are characterized, a step we believe helps save time in managing the characterization of invoices.
Until now, it was necessary to characterize each individual line of an invoice, i.e. every product or service you purchased. For example, if you bought various consumables (such as pens, books, etc.), you would have to characterize each of them separately, regardless of the number of lines of the total purchase entry.
With the new method of characterization, invoice handling becomes simpler. From now on, it’s enough to characterize the lines you have recorded in your accounting, provided the totals match those of the supplier.
Consider the following example of a consumables purchase invoice. Following the initial way of expense characterization, we would have to characterize each of the four lines. Otherwise, we receive an error message that the characterization lines do not agree with the supplier’s invoice lines.”
Supplier
| Description | Net Value | VAT % | VAT AMOUNT | Total Value |
| PEN GEL INK BLACK | 1.38 | 24% | 0.33 | 1.71 |
| PEN GEL INK BLUE | 1.38 | 24% | 0.33 | 1.71 |
| LIQUID CORRECTOR | 0.95 | 24% | 0.23 | 1.18 |
| BOOK ΧΧΧ | 12.27 | 6% | 0.74 | 13.01 |
| Total Invoice ammount | 15.98 | 1.63 | 17.61 |
In your ERP system, you typically record two lines, one for consumables with a VAT of 24% and one with a VAT of 6%.
Receiver
| Description | Net Value | VAT% | VAT AMOUNT | Total Value |
| Consumables 24% | 3.71 | 24% | 0.89 | 4.60 |
| Consumables 6% | 12.27 | 6% | 0.74 | 13.01 |
| Total Invoice ammount | 15.98 | 1.63 | 17.61 |
With the new method of characterization, it is sufficient to characterize the two lines we have recorded and the totals must agree with those of the supplier.
The announcement from AADE, which refers to ERPs, is quoted below and you can find it on the AADE page here.
MyData – ERP Platform
Upgraded Method of Characterizing Expenses – SendExpensesClassification
Calling the method of characterizing expenses from the recipient without restrictions/dependence on the number of lines of the issuer’s document
Ability to characterize expenses for Other Taxes, Stamp Duty and Fees
Possibility of allocating part of VAT under category 2.5 – General expenses without VAT deduction right
In the case of document lines where the issuer has declared an exception of Article 39a, the recipient can characterize with VAT
Enrichment of Request Method so that the counterparty is informed in case of declaration of deviation/rejection of document by the counterparty
