Vat - Sage Adjustments for Partial Exemption

columbia

Hi

Not sure if anyone can help out at all, but I need to make an adjustment for partial-exemption on my next vat return, and then I need to continue to make adjustments on each prior return.

Can anyone tell me the best way of making these adjustments in Sage. Ideally I would like to set up a journal as a template.

Thanks

Tracy

columbia

No worries guys, managed to sort it all out now.

totleyblade

Hi, I would be interested in how you made the adjustments. I used to have to adjust for partial exemption where I worked a number of years ago but made the calculations and adjustments outside the Sage programme.

Monsoon

It will be manual calculations and a manual journal, I expect I would run a VAT return as normal, post the VAT Wizard transfers to 2202, and then journal the partial exemption amount between 2202 and an expense account to account for the difference (the VAT that can't be reclaimed becomes an expense in the P&L).

Columbia, is that what you did?

columbia

Hi sorry for late reply, I've been on holiday.

I ran the vat return, and printed out the detailed transaction list, I then worked out which nominal codes I needed to adjust for partial exemption. (I keyed these into an excel spreadsheet so that I would have a physical copy of the codes I had adjusted in case of an inspection). I then did an adjustment to Box 4 on the vat return in Sage, when you do this you can type an explanation as to why you have adjusted the vat). Then I ran the Vat run as per usual. The difference this time is that it automatically posts the adjustments to Nominal code 2204, I will then set up a nominal code in the p&L to post the irrecoverable vat to.

I am finalising all the postings tomorrow, so if it is any different, or if anything weird happens I will let you know!