Help!! Totally lost! We have just started buying from a company in Germany. We use Sage 50 & I have just worked out (finally) how to get the sterling figures included on the VAT return in boxes 2,4,7 & 9. So far so good. However, this makes no difference to the figure in box 5 - the amount we have to pay to HMRC. Excuse my ignorance, but I assumed that when the Invoices were input, the VAT due figure would also drop. Can we claim back the VAT amount on German Invoices? if so, how? I have been using Sage for 15 years but I have never done any foreign Invoices - until now!
Hi Ness
We always ask newbies to do a little intro - where based/bit on bookkeeping background - which prof body/completed or doing a qualification and which one/work in accounting practice/have your own bookkeeping business/work in industry/work for own company doing own books - that sort of thing. Nothing major, just helps to get to know you a bit and how to pitch answers.
So when you say youve figured the boxes you have got it in to, it doesnt sound like you are that lost - but can I ask how you are doing it? Ie via what tax code in sage?
Only checking to make sure you are not using a convoluted route that might have an easier one, which I could suggest to help speed things up.
If you are VAT registered the German supplier should not be charging VAT - its dealt with under the reverse charge. So make sure they have your VAT number and are quoting it on the invoice. Then -
You as the purchaser effectively charge that VAT and then reclaim it - which is why its in boxes 2 and 4 - so the net effect is nil. Seems bonkers I know!
(VAT from outside the EU is very different so dont use the same methods - just thought I would mention in case you get any of those!)
__________________
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
Hi Joanne
I would like to do the little intro - but I'm not sure how to access it! Any help on that would be greatly appreciated - ever had one of those days where you know you should have stayed in bed?!!
Regarding Germany and VAT: I got the figures into the correct boxes using T8 and setting the rate at 20% - although I now understand German VAT to be 19%. We are VAT registered and our supplier has not charged VAT on their invoices, and they do quote our VAT number on the invoices.
I'm not sure I completely understand what I'm doing here, although as the figures are appearing in the correct boxes, maybe a little light is beginning to show!
Hi Ness
Oh I know that want to stay in bed feeling at the moment!!
You can do a little intro by just doing so on the end of this post. (Doesnt need to be on your profile as some of us have good memories or can always double check it by viewing back to your first post).
Spot on with the T8 code - well done with that. (Its a different T code is its services v goods)
Dont worry about the German VAT rate.
Easiest way to explain it I guess is (and I hope this makes sense) - Its you as purchasing company who charge yourselves the VAT (so use UK rate as you are based here) and then you re-claim it. Sounds mad I know. Easiest way to explain it I guess is (and I hope this makes sense)
Box 2 (output) is you paying it (as with box one on your sales)
Box 4 (input) is you re-claiming it (as you do with other VAT on purchases)
So thats an in/out - net NIL. Hence why its not in box 5.
Boxes 7 - shows all purchases and is used by HMRC as a rough guide to see if you are over-egging box 4.
Box 9 - is just for stats purposes.
HTH.
__________________
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
Thank you so much Joanne - sounds confusing - it is confusing, but at least I do understand better now.
A little about us / me: I have been working here for 5 years and, after one director left, have had near enough solo control over accounts / wages / CIS / VAT expenses etc. I can always go over things with my immediate boss, who is not completely up to speed on accounts! I have worked in accounts for some 15 plus years in various environments - Office equipment supplies & presentation, a Doctors surgery, a company selling weight training foods, a travel agency and now double glazing. Quite a large variety of industries, therefore a good general overview. I am mainly self taught - I had an excellent first boss, who taught me Sage very well and I backed up that knowledge with a Sage course to make sure I was doing the job right. I sailed through the first year of the AAT, but got totally lost on the second - probably because I had so much hands-on experience by then it all confused me!
I have tried other jobs at various times in between, but the figures keep calling me back!!
Hi Ness
Wow - sounds like you have had a real mixed bag of experience.
AAT is not for everyone and I think the course is very hard for those who dont have the chance to put big parts of it into practice as they run through the course. My son was finding that when he first started, especially round VAT, but he started working for me a few days a month and it started to drop into place a lot quicker. Despite sage doing the double entry he was thinking of each thing he did in terms of the double entry which cemented that knowledge further. Plus his mean Mum makes him work them out on a bit of paper sometimes!
I always say on here that the real learning starts once you have finished a course with the real world day to day things that are thrown at you working for clients. I had an interesting conversation with an AAT student who could not get their head round the fact that a business owner paid for things for the business themselves via their own credit card. But we all know they do so much worse than that in the real world.
If you ever decide to go back to training, the AAT might be easier to tackle given your real world experience. You may not want to do all of the levels and as of this year thats an option in that you can do up to level three and have a qualification at that point - its the AATQB - the qualified bookkeeper level. Or you might consider doing a free course to see if you take to it - such as the ACCA-x (free until you need to join and take the exams). Or you may not want to go back to 'school' at all and continue as you are - what is known as 'QE' - qualified by experience. It seems to have suited you so far by all accounts.
Look forward to hearing from you more on here.
__________________
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
Many thanks for your reply and wealth of information to digest! Plenty there to think about and I'm sure I will be back on here again in the not too distant future!!
Ness
