Taxable Amount Registration for Free-of-Charge Transactions

Hi,

Our Italian user sent a free sample product to their Swiss customer.

(1) For domestic free-of-charge transactions to send a sample to Italian customer, our user will charge output VAT amount to the customer while the sample product itself is for free.

(2) In this case of foreign customers, they won't charge output VAT.

e.g.

(1)

The Potential Product Sales Price: 100.00

Tax Rate: 21%

Taxable Amount: 100.00

Tax Amount: 21.00

Tax Explanation Code (on F03B11): VT

Journal: Dr. AR 21.00 / Cr. Output VAT 21.00

(2)

The Potential Product Sales Price: 100.00

Tax Rate: 0%

Taxable Amount: 100.00

Tax Amount: 0

Tax Explanation Code (on F03B11): ??

Journal: NONE

Case (2) is not supposed to be journalized on GL because no cash receipt is expected.