Sage and VAT Unregistered

Raging Pineapples

Ok, this is confusing, so I figured I'd ask this here...

We're using Sage Instant Accounts and I'm fairly certain we told Sage on install that our company is unregistered for VAT.

However, it will insist on handling Sales and Purchase invoices in a VAT inclusive way! We've managed just about to get it to zero-rate all our sales, but Purchase Invoices still have to be manually zero-rated and have the gross figure entered as the net amount because it will still treat VAT on Purchase Invoices as reclaimable on the Current Assets section.

Now this is generating completely misleading accounts information as there is absolutely no such asset under our circumstances. Yet we're at a loss trying to find what options there may be to treat this. You'd think there would be somewhere, since Sage Instant is specifically designed for small businesses, many of which would not be registered for VAT.

Also, we've been struggling to bring up a simple history of the double entry of transactions. We spend AGES trying to find out where it's posting things and it seems nearly impossible to get this kind of information. It matches payments and receipts to source documents nicely, but the nominal ledger seems very unsupportive.

...Erm... help?

AK002

What i would do is go into settings and configuration and change the tax codes fro T1 which is standard to a rate of 0.00 and untick include in VAT return.

So when you post a supplier invoice gross you will type the gross amount in the "Net" box and it won't add any VAT on and will appear in the NL as gross amount.

It's a bit of a pain...

Raging Pineapples

Thanks! I'll get that done next time I'm in the office, any idea about looking up the T accounts?

AK002

I don't think you can see T accounts as such but;

Modules -> financials

Will give you a list of everything that's been posted and where.

If it's a sales invoice it won't tell you it's Dr debtors Cr sales it'll just say Sales invoice and the nominal account it has Cr'd.

HTH.

Jan

I would leave the tax code alone and just designate your suppliers and customers to T9 in their record default box.
As AK says you don't see a T account, but you can see where it has been posted to in financials - ie where you have told it to hopefully!

AK002

Jan wrote: »

I would leave the tax code alone and just designate your suppliers and customers to T9 in their record default box.
As AK says you don't see a T account, but you can see where it has been posted to in financials - ie where you have told it to hopefully!

Is there a way to set T9 as the default? I had a small look y.day but couldn't see it.. That would be the best way....

A-Vic

AK002 wrote: »

Is there a way to set T9 as the default? I had a small look y.day but couldn't see it.. That would be the best way....

is it not under settings and configuration? Morning BTW

AK002

Hullo

Jan

You have to go into the customers record, look at the tabs at the top - where you would look for customer activity etc.

Actually I've just checked and if you go into settings, down from config there is a customer/purchases defaults section, click in there and you can set T9 for VAT and what nominal you want for sales/purchases..

Sorry can't always reply staright away, I'm in and out on here!

Kecak

If you're on Instant Accounts you can either go into each customer/supplier record and change the default tax code to T9...or if you're feeling a bit more adventurous you can do them all in 1 go.

You'll also want to go Settings > Customer Defaults/Supplier Defaults and set the default tax code in here to T9. --> This is used when you set up new records, also when you post Bank Payments/Receipts - it will look at this default setting to choose the initial T/C in the window.


Right...to do all the customer/suppliers in 1 go rather than every individual record.

You need to 1st generate all the records to a csv file which you can manipulate in Excel/Notepad.

eg. Customers:

**BACK UP BEFORE YOU TRY THIS **

Make sure you have none highlighted. (Click Clear down the bottom)

Reports > Customer Details Reports > Customer Record csv > Generate to File > make sure the file type is 'comma seperated values .csv'

Load this in Excel/notepad > change all T1 to T9 > Save > back in Sage > File > Import > Customer Record > Run > Find your file

as long as this imports successfully (it'll let you know) --> check and all your customers will now be on T9.

Monsoon

I'm confused by the lack of double entry. I've always found Sage really visible on this.

If you go into Nominal > Record you get a real T Account.

If you go into Financials, you see all the transactions and it will tell you what both the accounts are that the transaction posted to. The type of transaction will determine the Dr and Cr. Have a scoot round in Financials (remember you can sort the list by clicking on the column headings at the top) as this should contain all the info you need.

Raging Pineapples

What I found hard was getting the FULL double entry - perhaps other breeds of sage like Line 50 are more helpful in this, but Instant seems to keep a few cards close to its chest.

Our situation was that we told Sage Instant that we were VAT unregistered, and it proceeded to apply VAT anyway. So we had to figure out, is this a mistake, or is it posting the VAT amount to some clever sub-account in the Expenses/Revenue to let us analyse what our liability would have been and therefore whether it behoves us to register (which is something I would actually like it to do, just because I don't like losing VAT information in the DR and CR ledgers just because it isn't a liability right now).

But yeah, we could find all the basic DRs and CRs in Financials (so for instance, we could find a purchase invoice to which the supplier had charged VAT) and Financials simply had a kind of column to say "Yes it's got VAT on it" without saying which account this was put against.

Our MD (not used to Sage) spent hours on this... although I'd counter that 'Current Assets -> VAT Liability' was a good place to start looking But still, unless we've both been really dumb, it does seem that Financials doesn't give the FULL double entry including VAT?

I'll have to check this next time I'm in the office, but what are your thoughts?

AK002

Raging Pineapples wrote: »

But yeah, we could find all the basic DRs and CRs in Financials (so for instance, we could find a purchase invoice to which the supplier had charged VAT) and Financials simply had a kind of column to say "Yes it's got VAT on it" without saying which account this was put against.

To find out where items have been posted on the TB there should be a nominal code column in financials, this will give you a code on the TB, or under nominal ledger..

Julia Crouch

Hi RP

Not sure if I can help. Sage, although good can be confusing/frustrating at times particularly with what you are looking at here.

When you first install you do select if you are VAT registered or not. If you are, then Sage then allows you to enter a VAT number if you are not. then you cannot. However even if you say you are not VAT registered it still looks for VAT when you post entries.

What I do is then to change the percentages down to '0%' for codes T1 and T5 in settings, configuration. I do not stop entries from reporting on the VAT return since running a 'dummy' VAT return is a quick way to keep an eye on your taxable supplies and the VAT threashold.

I am not sure if you are able to run a 'detailed' audit trail report from the financials module in instant accounts, it may just show on the reports screen and you may not be able to run it If you can then this will give you what you are looking for, details of amounts net and where items are posted to and will split out the VAT amount posted to the 'Sales tax control account' - 2200 and 'Purchase tax control account' 2201.

2202 - VAT liability is used to journal the quarters input and output VAT to from the control accounts and then you post your VAT payment cheque here when you make your payment.

Not sure how you propose posting your corrections though to correct your balance sheet and move this down to the P&L. If your boss it not too worried about reporting to the penny on every line of expense and time is pressing then one post for the balance on 2200 to misc income and 2201 to misc expenses may suffice, keeping a print out of the two accounts to veryify the postings.

However if part personal expenditure is involved, eg fuel then it may be necessary to analyse out 2201 and post to individual lines for IT purposes.

Julia

Raging Pineapples

Thanks!

One or two of our invoices had VAT on them by default (we usually set the VAT amount to zero, but on these two we forgot), so we applied credit notes with a zero net figure and the vat figure we wanted to credit out (so it undid the VAT elements and excessive amounts on the Debtors Control but didn't touch the P&L accounts).

That seems to have done it nicely, and now we've changed the defaults so it should work.

I like your idea of simply reducing the rates to 0 so it doesn't calculate, but still keeping them, as I do like knowing how much we're spending on VAT even though we won't get anywhere near VAT Registration level.