VAT Payments to HMRC

Hi,

If I receive cheque from the inland revenue to refund VAT I have paid on purchases for that period how do i reflect that in the bank account & altering the VAT balance?

Similarly if I pay a VAT balance to HMRC?

Kind Regards

Posted by Chris on Apr 12, 2009 11:37 PM BST

Hi Chris,

When you receive a cheque from HMRC record a new Money Received transaction - deposit into the 'Cheque Account' and set the From Account to 'VAT Liability'.

Similarly when you pay money to HMRC create a Money Paid Out transaction and allocate to the 'VAT Liability' account from the 'Cheque Account'.

Note that if you use the VAT Return Guide window to prepare your return (click menu Tools > Prepare VAT Return) you will be given the chance to create the payment transaction on the last step.

Regards,

Posted by Mark McLaren (Solar Accounts) on Apr 13, 2009 9:37 AM BST