My client has got a VAT refund back from Germany after many months. It was for an exihibition that he did over there. They charged him 19% Vat which he managed to get back eventually. This has not gone on the usual Vat form as its not uk, the company origin is Germany. Plus he didn't get all of it back it was just a portion of it. Where would I post the refund to in Sage? I am using Sage instants.
Where did you post the original debit for the "German Vat Reclaimable"? I'd post the credit to the same nominal and write the inbalance off to p&l (assuming it was originally posted as a debtor in the balance sheet otherwise you don't need to worry about an inbalance)
hth
-- Edited by ADAS on Monday 28th of May 2012 06:37:05 PM
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Tony
Responses are intended as outline only. Formal advice should be sort from your Institutes Technical Department or a suitably qualified Accountant.
To answer this properly, more information is needed about what has actually been done in terms of the transactions entered in Sage already. However, reversing this, if you think about how it should have been done (if the VAT had been dealt with correctly in the first place and your client hadn't had to get a refund), you might be able to work out what you should do to correct it.
(Apologies if I'm teaching you to suck eggs with this explanation...)
Normally, your client would have provided his VAT number to the German company, and they would have charged him the net amount.
That would be entered in Sage using one of the tax codes designated as being for EC purchases, with the net amount, the tax code, and zero for the VAT amount. That net amount will end up in box 9 (as well as 7) of the VAT return. ISTR there's also a bit of funny business whereby - if you're importing goods - you need to declare the UK VAT in the outputs and reclaim it in the inputs, but you'd need to check that if it was relevant.
So, in your case, he's paid the VAT inclusive amount - and you say it's not gone on a VAT return. (Which tax code was used in Sage, then? I can only guess, and my guess would be T9?)
The subsequent refund: Who was the refund from, and why was it only partial? Again, I can only guess: Did it come from the German company, possibly because the client provided them with his VAT number after the event?
The necessary corrections depend on the above issues, as well as how it was entered in the first place; eg purchase invoice & payment versus simple bank payment, etc.
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Vince M Hudd - Soft Rock Software
(I only came here looking for fellow apiarists...)
It was not goods supplied it was for him to hire space at an exihibition. It wasn't the usual way of claiming back the Vat, yes it was a T9 to start with with the Gross amount. What I meant by not going on the Vat is, it wasn't a standard T1. They took off Bank charges and god knows what else off (their admin charges) before givin him some of it back. They were so bad hes not going there again. They advised him in the first place to claim back the Vat, he gave them his vat number at the beginning, before it was invoiced thats why he is querying having to pay it.
I didn't think it should go to the Vat liability in Sage as its not UK Vat at 20% (was 17.5% at the time), it was 19%.
I know its abit of an odd one, and when he ships good to europe we don't have this problem, everything is done in the correct manner.
In that case, I think I'd be inclined to check with HMRC first, to see how they say it should be treated - and then think about how that works in terms of how should be dealt with on Sage.
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Vince M Hudd - Soft Rock Software
(I only came here looking for fellow apiarists...)
