Syncro is moving to an ex VAT/GST model in our invoices, estimates and purchase orders for UK users. This will make using our invoice system feasible. We are offering a migration tool to help transition to this.

Note: This article and feature is for the following locales: Australia, New Zealand and UK only. Nothing here applies to users in other countries. More to the point, these features are not yet available to users in other countries that have VAT exclusive pricing. Throughout the article below we refer to VAT, but the same changes and function apply to locales with GST (AUS, NZ locales). See our FAQs for more information on future availability.

What’s changing

Line Items

The way line items are displayed is changing in these areas:

• Estimates
• Invoices
• Purchase Orders

Old—line items displayed the Rate as VAT inclusive (or incl VAT) on each line, but the Unit Extended as VAT exclusive (or ex VAT).

New—line items will be displayed as ex VAT (tax not included) on each line for both the Rate and Extended.

Purchase Orders will show the Price of the product as ex VAT instead of incl VAT in PO Detail.

Tax calculations

Tax calculations are changing in these areas:

• Estimates
• Invoices

Tax will no longer be calculated per line item before the complete subtotal calculation (multiple tax rates being the exception). Calculating on the subtotal fixes rounding errors that were occurring on per-line calculations.

Product Prices

Previously, we stored product prices as VAT incl. If you imported products from Pax8 or Xero, the price would be stored in the VAT Inclusive field.

The new method changes the price we store as the Exclusive price rather than the Inclusive price. See Product Migration below for before and after screenshots.

When you migrate to the new model we will not change any of the prices of your Products.

If your prices were VAT incl, then you will want to update your inventory to reflect the correct prices. Your inventory can be updated in a few ways.

• If you are storing your inventory in Pax8 or Xero as VAT Exclusive then you can perform a product import from Pax8 or Xero to your Syncro account and the prices will update using the stored price from Pax8 or Xero.
• You can also Export your inventory from the Inventory Modules to CSV. Then you can edit the prices for each product (remember not to modify the Product ID) within the CSV, Save, and Import the file back into your Syncro account.

Migration Tool

When you go to the Invoices, Estimates or Admin tabs, you will see a banner at the top: “Hey! You can now migrate to tax exclusive!” On the right, click the Click here to learn more button to get started.

This will take you to the Before you migrate to Tax Exclusive settings screen.

From there, the steps are simple.

1. Click the Invoice Migration bar.
2. Read the information to understand what will happen and take any appropriate action.
3. Turn on the I acknowledge this piece of information checkbox.
4. Repeat for the remaining bars.
5. Click Migrate to Tax Exclusive settings.
6. Review the final confirmation dialog and click Migrate to tax exclusive.

You are presumably here because you want more information than what the screen provides. Fair enough.

Invoice and Estimate Migration

To be clear, the migration will not modify any existing invoices or estimates. Paid invoices and approved estimates are safe since you cannot modify them (unless you delete an invoice payment or unapprove an estimate). For unpaid invoices and non-approved estimates, if you add new items, modify or delete them, it will recalculate the total. So before migrating, make sure unpaid invoices and non-approved estimates are in a good stable state because if someone modifies them, it will change the totals by a few cents (£0.05-0.06 on average).

Product Migration

Prior to the migration, the pricing section for a product or service looks like this:

The tax inclusive amount is in the Price field, and the tax ex-VAT amount is in the Price (tax exclusive @ 0.2 ) field.

The migration will remove the latter field, leaving you with only the Price field. More importantly, the Price field will now be the tax exclusive price, but we will not change the amount that is already there. This means that if the price in that field is tax incl, you will need to change it to tax excl.

See Product Prices above for more information.

Recurring Invoice Schedule Migration

Options 1 and 2 in this section refer to a setting on the right side of each recurring invoice template: Keep prices in sync with products if they change.

Click View Recurring Invoice Schedules so you can see what will be affected if you go with Option 1, that is, turning on the above setting so that templates will get updated with any pricing changes you make. If you have any Contracts, you should also check those and look at the Contract Price (override) field to see if you have any prices set there. If you do and the price is VAT incl, you will need to change it to ex VAT as well since it will override any regular product pricing changes you made.

In the screenshot above, the user has elected to go with Option 2, where the setting is turned off, so as to leave all the prices alone in the template.

Download Pending Items

To make it easier to see pending invoices, pending estimates, and recurring invoice schedules that will be affected by the migration, in the lower left click Download pending items CSV, then open the file in a spreadsheet program to review them.

Completing the migration

Once you’ve reviewed everything and turned on all the acknowledgement checkboxes (you will need to turn them on again if you leave the page to review anything), click Migrate to Tax Exclusive settings, which will bring up this confirmation dialog.

Make sure you’re good with everything, download pending items if you want, then in the lower right, click Migrate to tax exclusive. After a few moments, the migration will be complete!

After these updates, pricing will work like it does in the USA version of Syncro. Thus, most pricing instructions will apply both to the UK and USA.

Pax8 Integration Users

If you are an active Pax8 user prior to the migration, you may be employing a workaround for inventory management because of how Syncro was storing product prices. Here are some scenarios we encountered when working with some Pax8 users that may apply to you.

• Turned off tax globally on their Syncro account so that the imported exVAT prices didn’t have their values changed. Relied on the invoice syncing to Xero or QuickBooks Online where the tax would then get applied.
  • If this is you, then you can proceed through the VAT migration. Once complete, you can safely enable tax in Syncro once again and your prices will be calculated correctly moving forward.
• Increased the price of every subscription on the Pax8 side to account for the math that was performed by Syncro when the products were sent over.
  
  • If this is you, then you can proceed with the VAT migration. Once you complete the migration in Syncro, you will need to update the price of your products on the Pax8 side and then perform an import into Syncro.
    
    Note that part of the Pax8 integration is capable of updating individual line items on recurring subscription line prices. If you have it set this way, updating the prices on the Pax8 side could also be sufficient and you would not need to perform an import.
    
    (Pax8 currently doesn’t have a way to bulk export products into a CSV file at this time, so product price updates will need to be done one by one.)

FAQs

Q: When will this become available to other locales outside of the AUS, NZ, and UK?

A: This update required some major changes to our system and we decided to limit the change to one locale at launch due to the complexity. We have every intention of bringing this new model to Users in other locales moving forward. While we don’t have exact dates that can be shared at this time, please know that we will eventually share more on which locales will come next.

Q: Once I complete the migration process can I go back to the old way?

A: No, the migration is a one way process. Once completed, there is no way to revert.

Q: I read the import tool but I’m still not clear what changes will be or were made.

A: The changes can be distilled into two parts.

We have updated the tax model that is being used to calculate VAT to be more inline with user expectations.

The Estimate & Invoice UI has been updated to display line items as ex VAT with VAT added on at the end.

Q: Do I need to have all of my invoices marked as paid to migrate? (Invoices, Estimates)

A: No, you can migrate without touching a single invoice. The important part to understand is that updating any pre-existing invoice aside from marking it as paid can result in the invoice recalculating and the total changing slightly. This is because the tax model has been changed and in some cases can result in a slight total difference in some (not all) cases.

Q: I read the import tool but need someone to expand on the Product Update requirements.

A: With the update to the tax model, we have also updated how product prices are stored. Up to this change, we stored products as VAT inclusive. The new model stores VAT exclusive prices and then calculates the inclusive amount at the Invoice level. This means that you will need to update your product prices across your inventory. Thankfully, there are some quick options if you are making use of some integrations.

Option 1: If you are using Xero, then you can perform a Product Import from the Xero Settings page in Syncro. The import in this method will update the prices in your inventory with the prices Xero stores, which are VAT exclusive.

Option 2: If you are using Quickbooks Online, then just like Xero, you can perform an Import to update your inventory using the QBO stored prices which are VAT exclusive.

Option 3: If you are using Pax8 to sell licenses, then you can perform an Import from the Pax8 Settings page in Syncro to update the associated inventory prices which are stored as ex VAT.

Q: Will the migration change any of my older Invoices or Estimates?

A: No, the migration will not alter any older historical Estimates or Invoices that are completed or marked paid.

While we do recommend you complete any pending Invoices or Estimates before migrating, it is not required. If you migrate with any pending Invoices, note that editing the invoice’s line items in any way, including adding new lines, will result in the invoice performing a recalculation. This may result in cases where the total will fluctuate slightly from before the migration. This is due to rounding changes applied to the new VAT method.

Q: Is there a timeline for when you will force everyone to the new method?

A: For now, we have not set a timeline for when it will be required to migrate to the new method. We are focused on releasing the update and getting Users to use it. We intend to take in feedback to inform us on next steps and updates. There will be a time when we will move everyone over. Rest assured that we will communicate that to anyone not migrated well in advance of whatever that date ends up being.

Q: Why isn’t there an option to use my ex VAT prices when migrating? That is, use the price in the “Price (tax exclusive @ 0.2 )” field?

A: The price displayed in that field is calculated on the fly; we do not actually store it in the database. We did not offer an option to use that price because some of them would be incorrect due to rounding errors. This ensures that all prices you change to ex VAT are accurate.