How should we calculate VAT on the invoice we received from a foreign company for consultancy service and how should we specify it in the VAT declaration? (In Turkey)
We received consultancy services from a company in Italy. Fort his service, they invoiced us GBP 1,800. Should we deduct the VAT from the amount on this invoice and pay it in the VAT2 declaration and make a discount? Or do we have to recognize it as an expense?
You cannot calculate the VAT in an invoice for the services received from abroad. 18% of VAT is calculated from the amount of invoice and declared with VAT Declaration No.2. The VAT, which is declared and paid, is deducted in VAT Declaration No.1. The VAT is not stated as an expense.
Source: İSMMMO
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