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Post Info TOPIC: Incorrect VAT on purchase invoice (VAT return done)
Janka


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Incorrect VAT on purchase invoice (VAT return done)
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Please could anybody advice me how to fix this issue with VAT?
The company is VAT cash accounting, VAT return has been done and CIS (construction indursty shceme) return has been done which means that the VAT issue is impossible to resolve the most obvious way (Maintenance, Corrections).
Here is the incorrect posting for invoice:
N/C 6004 Other CIS expenses    Net £199.68    VAT 56.32 T1    Total £256
for money:
N/C 1221 Bank      Net £199.68   VAT56.32 T1   Total £256
The correct posting should be with zero VAT (T0). 
How would you suggest to fix it? How will it affect VAT return and CIS return? On the CIS sheme he was processed as GROSS which means no deductions were made. What kind of amendments will be necessary?
Many thanks


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Noola


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I have no idea how to adjust sorry.

My question however is, is the subcontractor registered for VAT? I always thought gross subcontractors charged VAT if they are above the threshold.

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Elaine R


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Hi Janka,

 

To correct the VAT issue I think you will have to put through a journal.  Debit expense £56.32 and Credit the VAT £56.32.

As for the CIS I think you will have to deduct the tax next time. (don't deal with CIS but that sounds like the best option)

On your next VAT return this correction will be reflected.

Hope that helps.

 

Elaine



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E Roscoe
gillyfleur


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I take it you are using sage as you mention maintenance and corrections. Even though the vat return has been reconciled you can still do this and it will put the entries into the current return. Alternatively you can credit out the incorrect transaction dated the in the correct period and reinput with the same date. Sage will then pick up there are entries in a prior period when generating the vat return and you answer yes to include them

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