My client is a sole trader and vat registered. They do the vat returns quarterly and so i have to manually record the vat returns in VT As I am doing their accounts... Does this mean then that when I post their sales and purchase invoices I dont record the vat on them, as I have already picked it up when I manually recorded their vat returns?
(going round in circles on this one and its late )
Should that not be the other way around and their invoices should be entered and the VAT return generated through VT (rather than manually overriding it).
The VAT returns that you generate should be the same as the one's that the client filed. If they are not then the client made a mistake meaning that you would have an under or over payment to journal.
I assume that you are doing this to bring things up to date before doing the VAT returns for the client going forwards? If thats the case then any minor balance discrepancy would be resolved by yourself in the next return.
I know what you mean about it being late. This is actually quite early few me but been pushing it a bit and my left eye's been twitching for the last hour or so. Think that it might be time for an early one (don't you just love the nine to five of this job, lol).
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Shaun
Responses are not meant as a substitute for professional advice. Answers are intended as outline only the advice of a qualified professional with access to all relevant information should be sought before acting on any response given.
I am only preparing their tax return, they will carry on doing their own vat returns..... What got me thinking about this is on last years balance sheet under current liabilities there is £9000 under VAT (along with creditors etc) so it got me thinking how I go about this?
When doing the accounts for a business rather than the bookkeeping we use the clients figures and confirm those against their documentation (invoices, receipts, bank statements, etc.) preparing an extended trial balance that we use to advise the client of adjustments that they need to journal (i.e. have the calculated their VAT correctly or do they need to make an adjustment in the next return).
As you are preparing accounts rather than bookkeeping I would have thought that you would have been using VT Accounts and Excel with the data from last years accounts and the trial balance entered directly into VT Accounts rather than via an upload from VT Transaction+.
The job that you are doing seems to be a hybrid where the client is doing their own bookkeeping (they must be if they are doing their own VAT returns) but then you are looking to repeat that by entering everything into VT Transaction+ rather than taking the clients figures into Excel, confirm back to documentation and prepare the accounts and tax return from the extended trial balance (with Accounts prepared via the VT Accounts package).
What software does this client use for their bookkeeping Georgie? If VT Cashbook or VT transaction+ then of course the above response alters somewhat in that you would be confirming their .vtr file back to documentation (even then I still find that I end up dropping stuff into Excel to play with). If other software such as sage or Xero then I would drop it Excel, manipulate it and then enter the totals from the ETB directly into VT Accounts, plus, have a list of journals that the client needs to apply to their books (and next year when you get their accounts confirm that they applied them!).
Hope that makes sense. I know that some of the above is pretty basic stuff that you already know but I appreciate that others with less experience than yourself, perhaps just starting out, will also be reading this thread so my repsponse has to be as clear as it can be to them as well.
kindest regards,
Shaun.
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Shaun
Responses are not meant as a substitute for professional advice. Answers are intended as outline only the advice of a qualified professional with access to all relevant information should be sought before acting on any response given.
They don't use any software, just record everything manually, and prepare the Vat Returns the same way. I have a copy of the accounts from last year so posted the balances from the P/L and B/S in to VT . I was going to enter their sales invoices and purchase invoices/receipts for the year and record the payments they have made to HMRC to the vat liability account. Is this right?
I think that you are missing out that as their accountant it's not the amounts that they have paid that matter so much as the amounts that they should have paid.
The approach that you are taking about entering everything into VT (basically redoing the bookkeeping) will include bank movements which will include the VAT paid / repaid which will end up balancing (although very seldom completely!) the VAT liability account.
VT transaction+ calculates what the amount should have been, the difference between the two ends up in a note to the client to tell them to adjust their figures in their books and in their next VAT return.
Back to your original question. Everything that you enter into VT would be done normally. No adjusting out of VAT and believing clients figures. What they actually paid (or received) is the only figure of theirs that matters. The rest of their VAT return can pretty much be ignored except for reference purposes as you will be recreating it through VT and then giving them an end of period adjustment to their figures.
Shaun.
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Shaun
Responses are not meant as a substitute for professional advice. Answers are intended as outline only the advice of a qualified professional with access to all relevant information should be sought before acting on any response given.
Georgie was recreating the bookkeeping already done manually but I assuming she wasn't doing a full reconstruction, hence the question on how to reconcile the two.
VT is particularly good in that you enter the total and it calculates the VAT but that won't help if there are none VAT transactions as well, only a full reconstruction would do that.
-- Edited by Shamus on Friday 18th of December 2015 04:12:09 PM
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John
Any advice given is for general guidance and professional advice should be sought applicable to your circumstances.
