Credit usage on invoices - avoiding VAT on affliate earnings?

[AvocentX]

I reach out to the community, as we have somewhat of an accounting problem with WHMCS.

 

Here is the background:

Client 1 buys a service and pays his €100 invoice. The VAT is calculated on the invoice and everything is fine. We have an invoice with a related transaction and ID.

Client 2 chooses Add Funds to his account, paying a €100 invoice. No VAT is added to the "Add Funds" invoice, but the transaction is added as reference. At a later stage, the client orders the same €100 service and VAT is calculated and part of the invoice. One problem is that the invoice will not have any reference to an actual transaction.

Client 3 is mainly an affiliate and earns €100 that is added to his credit balance. Client 3 orders the same €100 service and uses the credit to pay for the invoice. VAT is calculated and added just as in the other two scenarios.

 

Our problem is how to calculate our totals, such as in sales figure, VAT amounts etc. We have to be able to show each and every transaction coming in, as well as round up the VAT amount for each EU member country.

We have been doing this based on transactions, but realizes that any Add Funds payment goes unaccounted for.

We are not very keen on paying VAT on affiliate earnings, as we never actually sold a product for money - but more gave that away for free (i e not VAT)

 

How are we supposed to find a logic that will get us the actual figures and mainly the VAT amount?

We can't go on transactions, as that is clearly wrong.

We can't use paid invoices, as it may very well be paid by credits where we never took any money from that client?

 

I realize that the accounting rules may differ between countries, but still the logic should be just about the same?

Any help or input will be greatly appreciated!