Forum Message

Reclaiming VAT

Hi, Thanks for your quick response.
I have very little knowledge so please accept my silly questions.
I am trying to re-enter all my old account from quick book.
......I received a cheque from Vat office as my claim at my last vat period. Do i enter it as an income or what.
Tnks.


Posted by Bright on Jun 11, 2009 10:02 PM BST

Hi Bright,

No problem - keep the questions coming!

The payment you receive is not income; it's more like the repayment of a loan that you have provided to HM Revenue and Customs. (When you pay VAT to a supplier you increase this 'loan', when you collect VAT from a customer you decrease the 'loan').

To record the payment from HM Revenue and Customs, create a new Money Received transaction and enter these values:
- The Received From field should be 'HM Revenue and Customs'
- The Depist into Account field should be 'Cheque Account' (or other bank account)
- The VAT Treatment should be 'Out of Scope'
- The From Account should be 'VAT Liability'

Cheers,


Posted by Mark McLaren (Solar Accounts) on Jun 12, 2009 7:53 AM BST