Having taken over from outside accountants who did everything manually, I am now posting on Sage. This is my first quarter for VAT and my query is, for box 7 , total nett purchases, should invoices for consultants/sel;f employed tutors be included on the VAT return or coded t9 within Sage and omitted from it?
I have posted as zero rated, as none of them are VAT registered and my total for box 7 differs tremendously from previous entries from the prior accountants.
The difference is not only the sub contract labour, but it makes up a large chunk of it.
The total amount to pay is consistant, it is only box 7 where there is a large disparity.
Personallly I would include them in the VAT return. I would post them as T1 but with 0.00 in the VAT field....working on the premise that they would be vatable if they were VAT registered.
Thank you Pauline . I'm just so worried I'm going to kick off an inspection as it's over 60k different to what the accountants have previously totalled for box 7. I'm not sure whether to go with consistency or as you say, to post to reflect on the VAT return as I have done.
There have been many discussions on this if you search for VAT box 7 I'm sure you'll find some. Personally I go with Pauline and include them as the services would have been subject to VAT had the suppliers been VAT registered. However, others believe that because VAT hasn't been levied on them they should not be included. Advice from VAT inspectors has been equally at odds and reading the VAT handbook is also open to either interpretation.
