What's the best way to record VAT before VAT Registration?

Posted by irnbru PM | on Mon, 30/04/2012 - 10:44  1430  1 comment | report

An established business on VT has recently become VAT registered.   I can't find any reference to this scenario in VT Help.   Apart from posting a journal entry, is there a better way to record on the first vat return, the vat reclaimed on purchases/services in the prior 6 months?

Thanks.

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mr. mischief's picture

Yes    1 thanks

mr. mischief | Mon, 30/04/2012 - 13:42 | Permalink

This is exactly the sort of situation where VT gives Sage a good hiding.  Suppose one of the invoices was for £100 of accountancy, plus £20 VAT.

At the moment this one is showing as £120 accountancy.  You now change the company properties to "VAT registered".  Then edit the purchase invoice to "within the scope of VAT" and choose 20% as the VAT option.

Now the invoice is £100 accountancy, £20 VAT.

ONE CAVEAT

If a purchase invoice is dated before the last year-end, and you've issued year-end accounts, I recommend just doing this by journal.  This will preserve the link from source transactions to final accounts.  Note that in Sage you'd have to do the lot by journal.

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