Duty / VAT / C79

Duty / VAT / C79

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Hi,

The company i work for frequently buy in goods from non-EC member states i.e. Norway. When we receive invoices from our courier for the vat and duty import charges, i want to know how to account for the charges correctly. Currently the amounts on these invoices are charged as an expense with zero VAT (It shows up on the UPS invoice as a non taxable charge)

I recieve a monthly C79 form which is declared on the vat return to reduce my vat liability but i need to be sure that the UPS invoice is accounted for correctly?

Any help would be greatly appreciated!

Thanks

Replies (6)

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By tom123
14th Mar 2013 18:18

Post the transaction from the UPS invoice, with the C79 as memo

I would post the transaction from the UPS invoice, to the VAT control account (and duty account in the P&L).

I then compare the postings against the C79, and check I have no gaps over time.

 

Thanks (1)
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By User deleted
15th Mar 2013 10:29

My preference is to post the invoice with zero VAT ...

... to duty and VAT expense.

And then journal the C79 value monthly as a VAT only entry (Dr VAT Control, Cr Duty & VAT expense), having cross checked each line on the C79 to the corresponding UPS invoice by reference to the AWB numbers.

The C79 is not a memo, it IS the "VAT invoice". The UPS invoice is not a VAT invoice as they are only disbursing VAT on your behalf to effect customs clearance, and it may or may not be recoverable (although that applies to the C79 too).

Thanks (3)
Routemaster image
By tom123
15th Mar 2013 11:55

I will look at your way, OGA

I will certainly consider your method, OGA, and I accept what you are saying about the C79 being the invoice.

In my particular case my AP ledger is processed overseas, so I try to give them as few vat 'special cases' as possible - so it works better for me to process this way round.

I am also trying to avoid any 'double / neither' scenarios.

Thanks (0)
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By Chris Smail
15th Mar 2013 15:34

I always used to split the VAT

Post the UPS to the duty account as a VATable invoice with a disproportionate amount of VAT.

Check to C79 at end of month, it worked!

Thanks (0)
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By User deleted
15th Mar 2013 16:10

You could ...

... post the VAT to a VAT suspense account, to avoid it getting mised up in the P&L, and then journal from there once certificated with the C79.

I really don't think it correct to post direct from UPS invoice, even if the end result is the same.

If you have a VAT inspection the HMRC officer will not thank you for having to trawl through the UPS invoices to match the C79, better to have it hit the VAT account as a single easily identifiable figure.

As I say, UPS are just recharging a disbursement, not charging you VAT so the paper trail would be wrong, and could possibly result in VAT being reclaimed early.

Thanks (0)
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By karlb
05th Aug 2013 10:45

more questions

Thanks all for your answers, sorry for taking a while to get back to you all to say thanks too!

I have one final question now!

We also have shipments made by panalpina and Schenker. The invoices from these companies are for the frieght only. We pay HMRC direct for these costs each month and are reconciled on a deferment statement at the end of the month. What is the correct way to handle this?

To me it seems muddled with C79!

The C79 could show VAT for period of £20,000 for all suppliers wheras the deferment statement which is paid through the bank would be for instance £15,000? How do i account for the difference to reclaim the whole amount off the C79 back from HMRC?

Thanks (0)