Hi I have just started working for a charity but have never actually done a VAT return because other jobs haven't had the requirement to do so. I understand the principles of input and output VAT and the difference between the two are either payable or refundable.
Please could someone explain how it is reconciled on Sage because I have recently started this freelance job and I would like to understand it fully.
If I have included all unreconciled from a previous period how do I reconcile to make sure that the transactions do not reccur in the next VAT return. I am just a little uncertain as when I look at everything in the day books it looks fine, but I am not sure how to do it.
Just need to understand the mechanics of it manually aswell as computerised.
If you are using Sage 50 then use the manage VAT fuction. You put in your dates and press calculate, it comes up with a mock VAT return page then you need to check the balances in there against your day books and your control accounts. If you are happy that it balances then you can press reconcile and save the return for submission to HMRC.
When you come to carry out the next VAT return, it captures anything that wasn't reconciled in the previous return, so if you have made any adjustments to prior months it carries these over but ignores anything already reconciled.
I can explain more fully later if you need me to but currently at work trying to complete the Intrastat before going on holiday.
