EU vat purchases for UK company using VT Accounts

EU VAT in VT Accounts

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Does anyone have a guide for entering EU invoices to a UK company when they contain VAT recoverable from the EU using VT Accounts?  I am having a lot of problems sorting this out.

I will go into detail of the problem once someone can help me as it is quite lengthy to write if no one can.  Ideally I need a VT user in the same boat.  I buy wines from France and self import.

Replies (9)

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Scalloway Castle
By scalloway
28th Sep 2016 20:22

Do you quote your VAT number to your French supplier?

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By Wanderer
29th Sep 2016 08:57

1. Are you UK VAT registered?
2. Why are you being charged VAT?

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By GeoffatMM
29th Sep 2016 11:06

OK, here we go. First, thanks for your response.

To get the company going I registered it in the UK and purchased the wine in France excise and vat paid. I had to do this or I could not export it to the UK as an individual as I was agglomerating several producers. Let's not get into why, just believe me the rules for moving alcohol are complex.

I have subsequently registered as a vat individual so that I can purchase in France my self, recover VAT and ship (sell) to my company in the UK so now the problem is less as I run one set of accounts in france and one in the UK and do internal transfers between them using two separate regimes for recovering VAT.

However, for the first year I have to reclaim my vat via the UK to the French government and that means I have to show it in my accounts.

When I try to enter an invoice as a purchase from the EC, I enter the gross amount (say 1,200 euros including 200.00 vat) nominate vat and click on 20% it gives me;

Total 1,200 (correct)
vat 240 (incorrect, it should be 200)
vat payable in the EU 240 (incorrect, it should be 200)
Net value (for EC) 1,200 (incorrect, it should be 1,000)

If I change the gross amount to the net amount (1,000) it gives me;

Total 1,000 (incorrect, my supplier account is now undervalued by the vat)
vat 200 (correct)
vat payable in the EU 200 (correct)
Net value (for EC) 1,000 (correct)

If I try to adjust it manually, it always corrects itself so that the gross value is the same as the EC net value. I am sure it is because I do not understand cross border vat well enough but I cannot at the moment get my accounts to tally.

Any offers of explanation?

Geoff

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By GeoffatMM
29th Sep 2016 11:06

OK, here we go. First, thanks for your response.

To get the company going I registered it in the UK and purchased the wine in France excise and vat paid. I had to do this or I could not export it to the UK as an individual as I was agglomerating several producers. Let's not get into why, just believe me the rules for moving alcohol are complex.

I have subsequently registered as a vat individual so that I can purchase in France my self, recover VAT and ship (sell) to my company in the UK so now the problem is less as I run one set of accounts in france and one in the UK and do internal transfers between them using two separate regimes for recovering VAT.

However, for the first year I have to reclaim my vat via the UK to the French government and that means I have to show it in my accounts.

When I try to enter an invoice as a purchase from the EC, I enter the gross amount (say 1,200 euros including 200.00 vat) nominate vat and click on 20% it gives me;

Total 1,200 (correct)
vat 240 (incorrect, it should be 200)
vat payable in the EU 240 (incorrect, it should be 200)
Net value (for EC) 1,200 (incorrect, it should be 1,000)

If I change the gross amount to the net amount (1,000) it gives me;

Total 1,000 (incorrect, my supplier account is now undervalued by the vat)
vat 200 (correct)
vat payable in the EU 200 (correct)
Net value (for EC) 1,000 (correct)

If I try to adjust it manually, it always corrects itself so that the gross value is the same as the EC net value. I am sure it is because I do not understand cross border vat well enough but I cannot at the moment get my accounts to tally.

Any offers of explanation?

Geoff

Thanks (0)
Scalloway Castle
By scalloway
29th Sep 2016 12:27

If you are doing cross border EU VAT on acquisitions you will show the net amount due and the VAT will only appear on your VAT return.

You can't reclaim French VAT paid through a UK VAT return.

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By Wanderer
29th Sep 2016 12:51

1. "..... so that I can purchase in France my self, recover VAT ....."
Who are you trying to recover this from? As has been said above you can't recover French VAT from UK HMRC.

2. The correct VT transactions for a NET purchase of EU goods of 1,000 are:-

Total 1,000.00
Input VAT 200.00
EC VAT payable 200.00
Net 1,000.00

Note the 'Input VAT' and 'EC VAT payable' are NOT the French VAT. I think that may be where your confusion lies.

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By GeoffatMM
29th Sep 2016 13:56

Wanderer

I am trying to recover it from the French government but have to go through the UK government.

I also have to account for EC purchases and Sales on my VAT forms (boxes 6, 7, 8 & 9) and VT should do this for me automatically.

The only way to do this is to show the vat on the entry but mark it as an EC purchase and this is where the problem begins.

Are you a VT user as I really need advice from someone that uses VT for this activity as I think I understand what I should be doing in terms of my vat records and returns. It is just trying to get VT to do it without apparently having to fiddle it.

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Replying to GeoffatMM:
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By SJRUK
29th Sep 2016 14:46

VT is doing it correctly for EC Acquisitions.

If you need to claim French VAT you need to do this via another form, not your standard quarterly form - "VAT EU refunds".

https://www.gov.uk/guidance/vat-refunds-for-uk-businesses-buying-from-ot...

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Replying to GeoffatMM:
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By Wanderer
29th Sep 2016 15:50

GeoffatMM wrote:

Wanderer

I also have to account for EC purchases and Sales on my VAT forms (boxes 6, 7, 8 & 9) and VT should do this for me automatically.

The only way to do this is to show the vat on the entry but mark it as an EC purchase and this is where the problem begins.

Are you a VT user as I really need advice from someone that uses VT for this activity as I think I understand what I should be doing in terms of my vat records and returns. It is just trying to get VT to do it without apparently having to fiddle it.


Yes I'm a VT user & the way I've explained it above is exactly what you should be doing within VT which will trundle through to your UK VAT returns.

There is no fiddle here, VT does the job with no hassle on goods, services is a little more tricky in VT & could be described as a little fiddly, but goods work just fine.

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