Since I started to work with NAV 3.70, the logic behind reporting VAT was based on Posting Date.
For every Posted transaction to G/L (Journal or document), VAT Entries tables get populated with all VAT details and with Posting Date.
VAT Statement calculation and VAT submission to Tax Authorities (Almost each country has specific situations https://learn.microsoft.com/en-gb/dynamics365/business-central/about-localization) was based in the Posting Date field.
But last October 2022 this "dinosaur" behaviour was changed or was extended.
More details here -> https://learn.microsoft.com/en-us/dynamics365-release-plan/2022wave2/smb/dynamics365-business-central/new-vat-date-field-documents-entries.
My personal experience implementing VAT functionalities in different customers in different geographies confirms the "old" functionality as the common requirement to most of the companies and businesses cases.
But, the new field VAT Date extends this functionality for better and probably to address other business cases.
Some good discussion about possible business cases for this new functionality here -> https://open.spotify.com/episode/1rsbfiFChCq5nnKRzPjuK4?si=j7QtyUHgQH2eTU9yTe6ZuQ (after min 8).
If you are implementing Business Central, there is a new configuration required under General Ledger Setup: New field VAT Date Usage.
By default, this field has the value "Use full VAT Date functionality".
If you try to change this field to "Do not use VAT Date functionality" to have Posting Date as the date to be considered, you won't be able to save this change.
It was accepted by MSFT as a bug to be included in CU04 for BC21.
To workaround it now and without the need to wait for the hotfix, please enable the Feature Management Auto-Save.
Select the option Try it out and on the new window opened, you will be able to save the change.
IMPORTANT INFO from Product Group
When you choose 'do not use VAT date functionality', we cannot move the system out. In this case, the VAT date will be hidden from the UI, but the system will use the VAT Date everywhere.
But in this case VAT Date will be enforced to be the same as the Posting Date, so you can filter all entries by Posting Date and you can run VAT Statement by VAT Date, and the result will be the same. In this case it just means the user will not see this field and they don't need to think about that, and in the system Posting Date and VAT Date are the same.
For UK implementations, there is more to consider if you want to use VAT Date! MTD.
VAT return process (VAT Report Request Page) does not have the option to select VAT Date.
The BC Idea was raised Microsoft Idea (dynamics.com) and MSFT accepted to be included in the next minor release.
No release date is known until now!