VAT liability in Sage-Help! - The Book-keepers Forum (UK)

K12345 · Veteran Member

VAT liability in Sage-Help!

FoxAccountancyServices · Expert

Yes, do a journal as T9. Run a VAT return and reconcile it, so that when you do start using the VAT function, this sales VAT wont pull itself onto the first return. When you run the return it should only show the exact sales VAT that you are moving as a journal. If there is anything on the return, you have a bigger issue.

If you went over the VAT threshold, you would get one month before needing to charge VAT.. at the end of each month, look at the sales for the past 12 month period..if that goes over £79k, its time register. Lets say that happens on the 30.06.13 - you would be VAT registered from 01.08.13

K12345 · Veteran Member

Hi Michelle,

Thanks for your reply. Just to confirm, I have done a Journal from 2202 to 4000 both at T9 and now there is no VAT liability on P&L which is great. Now I go to VAT, calculate and it still shows the amount of the VAT liability due! Should I now flag transactions for VAT then reconcile to clear the liability?

Thanks again,

K12345 · Veteran Member

Sorry I mean the BS not the P&L!!

FoxAccountancyServices · Expert

I would have thought that sales VAT had been accumulating in code 2200?? Sales tax control account?? So, I am not sure why you have posted to 2202, or how the liability got in there.. however, if its sorted the issue, great. Just check now that adding that VAT back to the sales figure hasn't pushed you into the VAT threshold!

Yes, figures will appear on a Sage VAT return until you reconcile them.

K12345 · Veteran Member

2202 is the VAT Liability code and where it showed the amount due to pay HMRC. Now I have transferred this liability to sales 4000, is that correct?

Thanks

FoxAccountancyServices · Expert

I guess you must have done it in a certain way, so that the VAT went the 2202 account - as long as thats NIL, then it must be correct

Just to elaborate - when you post a bank receipt or sales invoice as T1, the VAT goes to 2200. If you have posted a journal, this might be why the balance is in 2202

Again, as long as you have NIL on the balance sheet and your sales are now the correct gross, then it sounds in order

K12345 · Veteran Member

Sorry i've confused myself now.

When a raise a TB it still shows amounts in

2200 sales tax control account eg.2000
2201 purchase tax control account and eg. 175
2202 vat liability account eg. 1825

If I reverse the journal that I have just done where should I transfer the above amounts to so that the liability disappears?

FoxAccountancyServices · Expert

Yeah you've confused me now too...!

From what you originally said, you were posting some sales with VAT. These amounts (eg £2000) go to 2200

Based on what you have put in your last post...

You have posted sales VAT to 2200

You have actually also posted VAT on purchases (eg £175) to 2201

I dont understand how the balance in 2202 has arisen unless you have posted some journal or bank payment

Either way, you have done more than your originally said.

If you would like me to look at it quickly, please contact me through my website. I will reply to you and you can send me a nominal activity report for the full period.

Telnkate · Veteran Member

Hiya!
I would suggest something different if there are aren't many to do... Back up first then
Depending on how many entries you've booked at T1 code, you can go to file/maintenance then select corrections. Once in, you can sort the columns by tax code by clicking on the header of the column. once there, you can manually go into each entry and edit. edit the detail and alter the tax code in the drop down box to T0.
save, job done.
It does seem like a long way round if you have loads but if not, it does the job -so I thought I would offer it as an interesting alternative...

:)

K12345 · Veteran Member

Hi,

Thank you both for your replies.

Michelle, I will contact you through your website, sorry I should of mentioned originally that I was posting all sales/purchases that were vatable to T1 incase we went over the threshold!

Many thanks,

FoxAccountancyServices · Expert

Kiz

Its a bigger job to fix basically, and I don't want to speculate on what you have done. If you update your Sage, and let me know the year and version please, when you send me the back up.

You will have to say hello through the website first, and then my reply will give you my address.

Telnkate makes an excellent suggestion, but seeing as you have already made journals, I would hang fire on doing it that way for now. I'll tell you if its going to be a good way for you to go.

Telnkate · Veteran Member

Agreed with Michelle - get an extra view on the position. if you have a backup prior to when you started posting journals, you could restore, but it sounds like you have some added value with some help from Michelle who is willing to look at the physical data and advise approprriately
(bon soir!)
x

Telnkate · Veteran Member

crap spelling - apols - late night eurovision cocktail fallout...

K12345 · Veteran Member

Thanks Telnkate,

All ok now, Michelle was a great help.

FoxAccountancyServices · Expert

One journal needed to made from 2200 sales VAT, to 4000 sales

Telnkate's suggestion could be used to sort the purchase VAT, or a journal can be made to reverse that 2201 VAT back to each expense code it belongs to.

In the end, the 2202 VAT liability journals had cancelled themselves out.

FoxAccountancyServices · Expert

Kiz, about your paye query - you haven't posted wages payment since april, so there is nothing clearing your journals after that date.

K12345 · Veteran Member

Thanks Michelle, I will look at it again later.

Thanks again,