Essential Business and Accounting Terms: Definitions
Essential Business and Accounting Terms
Commercial Money
Commercial Money: From a business perspective, this term refers to the economic activity undertaken.
Capital
Capital: In economic terms, capital is an income-producing element that is not intended to be exhausted or consumed. Instead, it should remain intact as part of generating new wealth. The *Law on Income* becomes important, as it distinguishes between income from capital and income originating from work.
Contributors
Contributors: These are the natural or legal persons, administrators, or holders of the property of others affected by taxes.
Tax Credit
Tax Credit: The tax, among other documents, includes supplier invoices, purchase invoices, debit notes, and credit received, evidencing the acquisition or use of services provided in the respective tax period.
Debit
Debit: In accounting terms, this is the name given to the left side of a ledger account. The sum of the amounts recorded on the debit side is called debits, and the action of debiting includes an amount called the charge, debit, or debit.
Debit Tax
Debit Tax: The Value Added Tax (VAT) included on invoices, settlements, debit notes, and credit notes issued for sales and services provided in the respective tax period.
Declaration Roadway
Declaration Roadway: A term used to define a tax motion that has no payment or reimbursement.
Home Statement of Activities
Home Statement of Activities: The statement or notice of the start of activity is the formalization to the IBS of the intention to undertake any activity that causes or may cause taxes.
Debtor
Debtor: A taxable person in law or taxpayer to whom the law assigns the position of having to declare and pay the tax and also meet other legal duties.
Bills
Bills: These are tax documents that traders usually send to another trader, detailing the goods sold, unit price, total value of the sale, and, if applicable, the time and method of payment.
Credit
Credit: In accounting terms, this is the name given to the right side of a ledger account. The sum of the amounts recorded as credits is called the credit, and the action of crediting is called to include an amount to be paid or credited.
Accounting Standards
Accounting Standards: A set of principles, rules, and conventions under which financial statements should be prepared. In tax terms, taxpayers should adjust their systems and the preparation of inventories to the accounting standards to clearly reflect the result of their movement and business.
Tax Rules
Tax Rules: A set of statutory bodies that govern or regulate the activities of all or part of the taxpayers through laws, decree-laws, and supreme decrees, among others of a tax nature.
Credit Notes
Credit Notes: These are documents that must be issued by vendors and service providers affected by Value Added Tax (VAT) for discounts or rebates granted after billing to buyers or recipients of services, as well as for the repayment of goods or contracts due to rescissions.
Debit Notes
Debit Notes: These are documents that must be issued by vendors and service providers affected by Value Added Tax (VAT) for increases in the tax charged.
Accounting
Accounting: Accounting is a technique that deals with recording, classifying, and summarizing the business operations of a company in order to interpret its results.