Solar Accounts

Haggis

I am a fan of Solar accounts but have now come across a problem with accounting for VAT for my client who became VAT registered (flat rate scheme) part way through the year on the 1st of January. Has anyone any experience of how to deal with this as you cannot enter a "start date for VAT " in Solar accounts ?

I have already entered transactions for Jan and am wondering if I should delete them, make sure I have entered all the transactions for Apr - Dec and then set him up as VAT reg and the carry on with the rest of the accounts ? Will Solar accounts not make adjustments for VAT for the Apr - Dec stuff ?

Hope this makes sense, getting confused ! many thanks

Monsoon

If someone isn't VAT registered, no VAT should get recorded on the system. Once they register for VAT, you go into settings and change the VAT registered tick box. From 1st Jan, you enter all transactions with VAT as you normally would.

It shouldn't go back and amend any previously entered transactions. It should all be fine.

One thing I do recommend when working with VAT on Solar, is to rename the VAT Liability Account to "VAT running account" and create a new account called VAT Liability. Every quarter, do a journal from the running account to the liability account (just like you would in Sage). This will clear the running account down to Zero. This is really important in Solar as it won't do a VAT reconciliation, so it will help highlight if any transactions haven't been picked up on the VAT return (if you check the balance on the running account at the end of last quarter after the journal's been run and it's not zero, you know some other transactions have been posted in the period that will need manually including).

wildgoose1uk

Now that's good advice!

Haggis

Thanks for your help, I have now altered and changed the accounts on Solar as you suggested. I feel a lot more confident now that it will work properly, really appreciate your comments, thanks again

Monsoon

No worries. The lack of a VAT rec is the weakest point of Solar and the above is the best way round it I've found so far. It doesn't work so good on cash accounting because the running account won't go down to £0.00 in the majority of cases. But it still helps.