I'm just finalising a vat return for a client who uses Xero accounting. I've run the vat report and checked everything looks okay. I've also run the balance sheet report and the vat liability account as at 31st Dec is about £2k less than the vat due on the vat return.
I'm wondering if the balance in the vat liability was because of historical transactions prior to when we started using Xero at the beginning of 2011. Just panicking really and wondering how I can check what's right especially as we'll be doing year end shortly too.
Apologies for rambling... I've contacted Xero support too.
I'm just finalising a vat return for a client who uses Xero accounting. I've run the vat report and checked everything looks okay. I've also run the balance sheet report and the vat liability account as at 31st Dec is about £2k less than the vat due on the vat return.
I'm wondering if the balance in the vat liability was because of historical transactions prior to when we started using Xero at the beginning of 2011. Just panicking really and wondering how I can check what's right especially as we'll be doing year end shortly too.
Apologies for rambling... I've contacted Xero support too.
Thanks
Angie
Couple of questions:-
1. A bit obvious, I know, do you use cash accounting basis to prepare your VAT Returns? If you do then there will always likely be a difference between the Return and the liability shown in the Balance Sheet.
2. How did you transfer the balances from the old system onto Xero? Did you use the individual invoices, split between VAT and expense, when transferring the sales and purchases ledger across or just the balance for each relevant customer/supplier. Again, a difference will occur if cash accounting is used.
-- Edited by Truemanbrown on Thursday 2nd of February 2012 12:47:22 PM
Thanks for replying. They don't use cash accounting but I did check through previous vat returns to check against payments - found one bill which was a duplicate that was throwing things out but also a journal I had done for vat fuel scale charges was incorrect. I reversed the journals and re-did them (following a reply from another post on the Forum).
Funny thing was that after the help of the other Forum member for the fuel scale charges I knew where I'd gone wrong. In the meantime I'd asked Xero support for help and the journal they'd sent me was incorrect and I knew it. Doing the journal wasn't straight forward but I used the suspense account to get the vat right and then it all balanced.
