Hi - can I sanity check something please? One of my clients has to move from Flat Rate to Standard VAT. Is Sage clever enough not to double count anything?
For example SI was raised in April, which was still in Flat Rate Scheme, then SR was put through in May which falls in the Standard VAT Scheme date, will Sage count the SR towards the next VAT Return, even though the SI was flagged for VAT in the previous return period?
I hope this makes sense, it's late and I've had a long day (see previous post!).
I've never used Sage for flat rate, so I can't speak from direct experience. However, what I found when making the switch both to and from cash based accounting in my version of Sage 50 (2013 - v19) was:
When switching from invoice to cash based accounting, Sage didn't take into account items on which the VAT had already been accounted for when they were subsequently paid: Which means if I hadn't spotted the issue and posted some adjustments to prevent it, Sage would have double paid the VAT on sales invoices and double claimed it on purchase invoices.
When switching from cash to invoice based accounting, Sage treated all sales and purchase invoices already on the system as reconciled for VAT - so the VAT still due to be paid on outstanding sales invoices/claimed on outstanding purchase invoices wouldn't have been included on the next return had I not spotted and dealt with it.
I therefore suspect you'll also need to correct Sage in your case* - so I strongly recommend that as soon as you make the switch (don't forget your backup!) you do a manual calculation of the VAT to establish what you think it should be, then run the VAT return procedure in Sage to see what it comes up with. Compare the two and, if necessary, decide what needs to be done in Sage to bring it into line.
* However, my memory is telling me that I've made the switch in the distant past and Sage has got it right - so this might be something that has changed at some point, so it's possible that it may have changed (again?) since my version - and you're making a different switch anyway, which may work differently. Either way, I'd always recommend doing the manual calculations in such situations to be sure (and not just with Sage - with any software).
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Vince M Hudd - Soft Rock Software
(I only came here looking for fellow apiarists...)
Hi
Ive not done this either, but i found this. Not sure what version of sage you are on but hope it helps. Dont forget those life savings backups first though.
Ha! I didn't think to look on Sage's website when I've switched. That link basically confirms what I found, though, and offers reports to establish what I worked out another way.
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Vince M Hudd - Soft Rock Software
(I only came here looking for fellow apiarists...)
To be honest - im so busy at the mo that I didnt even read the sage help page through but just enough to see it might help. Normally they dont have much detail do they, so I dont blame you for working it out for yourself Vince, thats what I tend to try to do.
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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
Thanks Vince and Jo. It's so useful having somewhere to just bounce an idea around. I think I will do my own manual calc to see how that compares to Sage.
I have another client where we have just gone from Cash Accounting to Standard VAT and that required me to cut off at 31 July, run the VAT Return on the cash basis, print a detailed aged debtors and creditors and then add those manually to the VAT Return before flicking the switch in Sage to 'Standard VAT' otherwise the SI and PI on the ledgers would be in 'no man's land' and never be picked up.
I am hoping my current scenario is not like that, and that Sage will be right, I am just struggling to get it clear in my head and needed a sanity check!
The good news is that Sage is clever!! The VAT Return generated by Sage for my first cash accounting period ie May, June and July does equal the same as the bank report for Customer Receipts less Customer Payments for the same period!! Phew!!!!
This must be in more recent versions -I have done standard to cash accounting before and had to manually do the adjustments but it was several years ago
Ive noticed a few improvements in the v21, although I was working on very old ones before so anything is better than that! Although - the screens seem to me to look very cluttered but I can live with that for the enhancements. It will be the last version I have though as its too costly and they have stopped doing their desktop versions, so Im probably going to go down the VT route in the next couple of years.
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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
