I started bookkeeping and VAT recently. My very first client gave me all purchase invoices and till receipts. I did calculations for input tax but I am stuck on Sales. Till receipts are giving summary sales for Grocery, paper/magz, vegetables, wines, cigarettes, frozen, dairy, sandwiches, stationery and lottery. How shall I calculate output VAT from these till receipts? I have analysed all till receipts on spraedsheet.
You need to ascertain which sales are standard rated and calculate the VAT on these. Standard rated sales are sales such as alcohol, cigarettes, phone top-ups and stationery etc. Zero rated and exempt sales include food, postage (stamps) and newspapers etc. The lottery sales will also be exempt from VAT so you can ignore these for your vat return. The customs website (www.hmrc.gov.uk) lists which items are standard, exempt and zero rated.
The figures included on the till receipts will be Gross amounts, therefore if you apply the VAT calc (x 7 divide by 47) to the standard rated items you have identified, you will get the output VAT you will need to include on your vat return.
I appreciate your quick response. Can you please also tell me what's the situation with Grocery, frozen food and dairy products? Are they standard rated or zero rated? with lottery, do we have to include commission in total sales or we have to include gross amount of lottery money in total sales column in VAT return?
Most food sold is zero-rated (excluding food supplied in the course of catering) which includes groceries, frozen food and dairy produce. You therefore include the gross selling price of these items in the net output box on the vat return, but don't include any output vat (i.e. in box 1 or 3).
National lottery commission is exempt from VAT, and so is Gross Lottery Sales. Therefore neither of these go on the VAT return.
Completing a Vat return is a fairly simple process. Identifying whats reclaimable and which sales to account for output vat on is the main thing. An informative website you may want to view before finalising your clients return is www.businesslink.gov.uk and reading the Vat section. It gives lots of hints and tips of what to look for and a checklist to complete as well.
I am trying to help my friend to do bookkeeping for her new pub. Do you know how to book till receipts( in sage) for things she had to buy to refurbish her pub and can we claim vat from thic receipts things like fire extinguisher light bulbs .
