VAT Help again!!
Hello,
I need help on VAT entries. Please ignore all other postings that I done.
I work for a charity and we operate a partial exemption scheme ie we can only claim a proportion of our INPUT VAT.
Im trying to prepare a VAT journal for quarter one.
At the end of quarter one the INPUT VAT = 10,323
OUTPUT VAT = 19,872
We calulated that we can only claim £7,555 of our INPUT VAT. Therefore, we made a payment of £12,317.
My journal would be:
Cr Bank 12,317
Dr VAT Repayment 12,317 (VAT Control a/c)
Cr Irrcoverable VAT (VAT Control A/c) £2,768
Dr Irrcoverable VAT (Profit & Loss a/c) £2,768
The INPUT VAT that we could claim ie £7,555 I propose to CREDIT as INCOME in the P&L but what do I DEBIT!!???
Please can you help me? I use Exchequer Accounting Software.
Thank you,
Brian D
I need help on VAT entries. Please ignore all other postings that I done.
I work for a charity and we operate a partial exemption scheme ie we can only claim a proportion of our INPUT VAT.
Im trying to prepare a VAT journal for quarter one.
At the end of quarter one the INPUT VAT = 10,323
OUTPUT VAT = 19,872
We calulated that we can only claim £7,555 of our INPUT VAT. Therefore, we made a payment of £12,317.
My journal would be:
Cr Bank 12,317
Dr VAT Repayment 12,317 (VAT Control a/c)
Cr Irrcoverable VAT (VAT Control A/c) £2,768
Dr Irrcoverable VAT (Profit & Loss a/c) £2,768
The INPUT VAT that we could claim ie £7,555 I propose to CREDIT as INCOME in the P&L but what do I DEBIT!!???
Please can you help me? I use Exchequer Accounting Software.
Thank you,
Brian D
0
Comments
-
Surely the Input VAT is already in the control accout? I'm not familiar with your software, however I would guess that in the quarter:
DR VAT CONTROL (Input VAT) £10323
CR VAT CONTROL (Output VAT) £19872
Balance on VAT CONTROL £9550
However, you can't pay that, as you can't reclaim all your Input VAT.
The difference between 10323 and 7555 is £2768, therefore you would
CR VAT CONTROL £2768
DR P&L - Ireecoverable Input VAT £2768
This will make the balance on the VAT control account correct to your liability, which will be £12318
You then pay this as normal, CR bank, DR VAT Control.
Balance on VAT control is now Nil.
That should be it.
I think you're getting confused with this bit:The INPUT VAT that we could claim ie £7,555 I propose to CREDIT as INCOME in the P&L but what do I DEBIT!!???0 -
Thank you for your help. This is was I thought as well and I wanted to double check!
Brian0 -
Jolly good, glad it made sense0
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