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Sage Flat Rate Scheme

Sage Flat Rate Scheme

Non-vat registered business been trading for several years. I want to put the business onto Sage v22 from 01/04/15. Business became VAT registered on 01/12/15 using the flat rate scheme. On 01/12/15 business can claim input tax on goods bought during previous 4 years and still on hand at 01/12/15, and can reclaim VAT on services during previous 6 months. I want to put the whole lot onto Sage. I’ve got loads of Sage clients but none using the FRS. My questions are: (a) How do I ensure that VAT on pre-registration expenditure is recovered? If I put these as T1 will they be picked up when I run the VAT return for the first quarter? If not, would I be better preparing a VAT return for the entire pre-registration period? (b) How do I ensure that the FRS only applies to post-registration turnover? Should I input transactions to 30/11/15 then do the VAT reconciliation, then do the first property FRS period? (c) My client often forgets about cash transactions at the time then remembers them months later. I am expecting him to remember pre-registration income after I’ve done the first FRS return. If, say, during FRS period 2 I input into Sage income details dated pre-FRS, will Sage include these as part of FRS period 2 turnover or is Sage clever enough to realise the turnover is pre-FRS?

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By JKnight
29th Feb 2016 14:09

FRS and Sage

With flat rate scheme activated, Sage uses tax code T25 for the recovery of VAT on capital goods. So you could use T25 to get VAT pre-registration costs to appear on the Sage return. T1 purchases will not appear on a FRS return in Sage. Or post everything as T9 up to 30/11/2015 and use the "Make Adjustments" feature to claim any pre-registration VAT on the return itself.

Use tax code T9 for any transactions that you do not want to appear on the return.

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