Probably this is a basic question.
I noticed that the VAT liability in Trial Balance is different from the VAT liability in the VAT report. I reconciled the two years and the VAT paid is as per the VAT report but for every single quarter the VAT from TB is different. Why?
In the accounts should I count only the VAT from the VAT report?
Many thanks,
Replies (4)
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You just need to reconcile the two figures and deal with the differences don't you? In the accounts you should recognise you actual VAT liability. If the figure currently in the books does not represent your actual liability it will when you put through the correcting entries that come out of your reconciliation.
Are you on
VAT Cash accounting? If so, the VAT on debtors/creditors will be a reconciling item.
Cash accounting?
VAT Cash accounting? If so, the VAT on debtors/creditors will be a reconciling item.
Of course I agree with this! But I assume OP's question was prompted by two figures that would be expected to be the same being different. Under cash accounting they would never be the same in any event.