How is Vat accounted for in business records?
Through a VAT Control Account
Is VAT usually a asset or liability?
Liability (credits increase what you owe).
What impacts input vat?
Purchase invoices and purchase returns (debit and credit notes FROM suppliers)
What impacts output VAT?
Sales invoices and sales returns credit notes to customers
What goes in box 1 of the VAT Return?
VAT due in this period on sales and other outputs:
- total of output VAT on sales
- less VAT on credit notes
- Plus any fuel scale charges
- plus adjustments for errors
What goes in Box 2 of the VAT return?
VAT due on any acquisitions from other EU countries
What goes in Box 3 of the VAT return?
Total of boxes 1 and 2
What goes in Box 4 of the VAT return?
VAT reclaimed on any purchases and other inputs, including acquisitions from the EC:
- total input VAT on purchases and expenses
- less VAT on any credit notes received
- Plus VAT on acquisitions from other EU countries
- Plus bad debt relief
- Plus any adjustments from earlier errors.
What goes in Box 5 of the VAT RETURN?
Net VAT to be paid to HMRC or reclaimed from HMRC :
Deduct box 4 from box 3
If output tax (box 3) is > box 4, then tax is payable to HMRC
If input tax (box 4) is > box 3 then tax is reclaimable from HMRC.
What rounding do you use for boxes 6 - 9?
Rounded Pounds
What goes in Box 6 of the VAT Return?
Total value of sales and all other inputs excluding VAT:
Includes total of all sales minus credit notes issued. Including:
- standard rated
- zero rated
- exempt sales
- supplies to EU member countries (despatches)
What goes in Box 7 of the VAT return?
Total value of purchases and all other inputs, excluding any VAT:
Total of all purchases and other expenses less credit notes received excluding VAT. Includes:
- standard rated supplies inc imports
- zero rated supplies inc imports
- exempt supplies
- acquisitions from EU member countries
What goes in Box 8 of the VAT Return?
Total value of all supplies of goods and related costs, excluding VAT, to other EC member states.
Also included in box 6 - you should not include box 8 in the value of goods supplied to EU customers, who are not VAT Registered.
What goes in Box 9 of the VAT Return?
Total value of all acquisitions of goods and related costs excluding any VAT, from other EC member states.
(Related costs included insurance and freight costs).
What are the standard submission deadlines for VAT Returns?
Submission and payment will be due 7 calendar days after the end of the month following the end of the return period.
What are some exceptions to the submission deadline rule?
- Traders who are eligible for the annual accounting scheme.
- Traders who are still able to submit paper returns (up to 1 month after end of VAT period)
- Traders who make payment on account (1month)
- Traders who pay by direct debit (extra 3 days)
