VAT invoices from non vat registered supplier

VAT invoices from non vat registered supplier

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Hi,

This is not a new topic but I would still like to gauge your opinion.   I would like to know what people are doing with regards to posting invoices from non vat registered suppliers for a taxable supply?  I am probably siding with those who include it box 7 of the vat return and am interested to finding out how people post these items in their accounting software. I deal with XERO and SAGE.

I think a lot of people out there are using the ZERO rated code which I don't think is strictly correct as the item is not ZERO rated but agree that this does achieve the objective of getting the net value into box 7.

Does anybody standard rate the item and nil value the VAT field? Can you do this in SAGE and XERO?

Thank you

Replies (10)

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By cathyaavs
07th Nov 2014 15:30

we use sage and what I have done it to use a spare vat code (eg T3) set to zero vat, and to appear in box 7 - at least that way all the non-registered, vatable supplies can be separated, and identified if need be, for reconciliation purposes.

Thanks (1)
Replying to whitevanman:
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By WBKC
08th Nov 2014 11:33

Thank you for your reply but could I ask how you manage to get the NET value into box 7. Easy to get the Gross value of the expense or purchase in box 7 but not sure how to get the net value?

Thank you

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Replying to Justin Bryant:
By bro0010
08th Nov 2014 14:48

Same thing

WBKC wrote:

Thank you for your reply but could I ask how you manage to get the NET value into box 7. Easy to get the Gross value of the expense or purchase in box 7 but not sure how to get the net value?

Thank you

If the supplier is not VAT registered then the GROSS value is the NET value.

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Replying to Poltergeist:
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By WBKC
08th Nov 2014 15:03


Sorry I was thinking about how to get net value into box 7 on the online return in the situation where there is vat but you can't reclaim eg bus entertaining

 

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RLI
By lionofludesch
08th Nov 2014 20:18

Sometimes not worth the effort

If it's so significant that it bothers you, you can always jot the figures down on the back of a fag packet and use HMRC's excellent VAT Return software.

Sometimes it's not worth amending the software to save a few minutes' work a quarter.

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By john.firstaccountancy
08th Nov 2014 23:52

Outside the scope

I think you will find that it does not have to be included in the VAT return, as they are not VAT registered. They do not charges VAT , I have checked with a text book and this supports the view.   

In sage it should be T9 and therefore will not show on the VAT return, perhaps not something to worry about though.    

 

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Replying to paul.benny:
RLI
By lionofludesch
10th Nov 2014 09:05

Big Debate

john.firstaccountancy wrote:

I think you will find that it does not have to be included in the VAT return, as they are not VAT registered. They do not charges VAT , I have checked with a text book and this supports the view.   

In sage it should be T9 and therefore will not show on the VAT return, perhaps not something to worry about though.    

There was a huge debate on this not so long ago.   I agree with you - but the general consensus was that we were wrong.

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By john.firstaccountancy
10th Nov 2014 10:18

Thanks for your reply 

Thanks for your reply 

Asked a VAT officer a few year ago and he said that was the correct treatment, however they would not be worried as long as the business was consistant with its treatment   

Perhaps each VAT inspector may have a different opinion but it is in reality it is out side the scope for VAT.    

 

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Replying to Agutter Accounts:
RLI
By lionofludesch
10th Nov 2014 10:27

Still agree

john.firstaccountancy wrote:

Thanks for your reply 

Asked a VAT officer a few year ago and he said that was the correct treatment, however they would not be worried as long as the business was consistant with its treatment   

Perhaps each VAT inspector may have a different opinion but it is in reality it is out side the scope for VAT.    

I still agree with you.

But - either way - it's never been a problem.  I've never had a VAT control visit on the basis that the Box 7 figures didn't look right.

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By john.firstaccountancy
10th Nov 2014 12:27

YES i still think it correct also

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