Ah right. I thought you could claim the VAT back on fixed assets and things like kitchen equipment/rent/stationery etc from pre VAt registration. Have I totally mis-understood this too Mark?
-- Edited by Cheshire on Tuesday 5th of November 2013 04:44:26 PM
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Joanne
Winner of Bookkeeper of the Year 2015, 2016 & 2017
Thoughts are my own/not to be regarded as official advice,which should be sought from a suitably qualified Accountant.
You should check out answers with reference to the legal position
I look after a new cafe who have not yet registered for VAT as they are nowhere near the threshold and buy in food (zero rated) and pay on their sales. They will register once they are near the threshold.
I am planning on keying the existing sales and all food purchases as T9 in Sage, with all other invoices as T1 (if they are vatable) so that they will be picked up in the 'unreconciled' category in the first VAT return as they represent the limited company/set up costs.
Does this sound the right way to go about matters?
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Joanne
Winner of Bookkeeper of the Year 2015, 2016 & 2017
Thoughts are my own/not to be regarded as official advice,which should be sought from a suitably qualified Accountant.
You should check out answers with reference to the legal position
Key everything as T9 until VAT registered and then once they are
Sales will be T1
Costs will be T0, T1 or T9 depending on VAT status of the item bought.
Will be able to to back and reclaim VAT on goods bought 4 years before VAT registered and services 6 months before VAT registered if they still had the stock and services unused at date of VAT registration.
You can claim back VAT on any asset provided you still have it at the date you become VAT registered. So you can claim VAT on things like
Fixed Assets
Stock
Kitchen Equipment
but only if you still have it on the date you become VAT registered.
Services can only be reclaimed if you are still to use the service on the date you become VAT registered. So if the rent relates to a period before becoming VAT registered then you cant reclaim. If you have used the stationery before you become VAT registered then you cant reclaim the VAT.
So as you can see claim VAT on goods is more black and white whereas services is a greyer area.
I think what may be occurring here is Joanne is wondering how the items are picked up by Sage as they are initially keyed in for the VAT return.
I don't think it works that way. When I had to do it I calculated the items that it applied for in Excel and then made the adjustment while processing the VAT return in Sage.
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Hi Both
Good to know I can claim the Fixed assets and bits for the kitchen back - they definitely still have them all but I will be checking nearer the time to be sure. And yes Peasie I was wondering about the keying of them in Sage, as I thought I could do key those particular items as T1/vatable in sage so they would be picked up as part of the 'unreconciled' items once it is VAT registered. Best I do them all as T9 though as it could be a couple more months before its registered so I think a spreadsheet is probably the way to go though and as you say do an adjustment.
Thanks both - I feel a lot happier about it now.
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Joanne
Winner of Bookkeeper of the Year 2015, 2016 & 2017
Thoughts are my own/not to be regarded as official advice,which should be sought from a suitably qualified Accountant.
You should check out answers with reference to the legal position
You can do manual adjustment for the VAT on anything previous to VAT registration.
When the time comes, print out the return for the normal first quarter, and increase input VAT and net purchases by the VAT on assets held (write on notes and staple any supporting schedule to the back).
Then you can post a T9 journal for the VAT element - DR VAT Liability, CR relevant fixed asset cost code with a clear narrative.
Then run your VAT transfer wizard, which will post the un-adjusted sales and input vat, from the Sage return you generated, to the VAT Liability code.. this combined with the journal should equal what you are going to pay.
Thanks Michelle, its been quite hard to remember to key everything today with T9! Just started getting used to it at the end of the day so will have to remember to go back to T1/T0 for my other clients!
__________________
Joanne
Winner of Bookkeeper of the Year 2015, 2016 & 2017
Thoughts are my own/not to be regarded as official advice,which should be sought from a suitably qualified Accountant.
You should check out answers with reference to the legal position
