Change in VAT question :)

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craggle87
craggle87 Registered Posts: 24 New contributor 🐸
in VAT
Hi Everyone, I have a question relating to the change in VAT rate. Any help would be appreciated. Due to the change I am just wondering how to raise an invoice.

We train school children in cycling and in 2010 we invoiced for 400 pupils at £40 p/p, at 17.5%. It's now 2011 and i've been told this figure has dropped to 380 pupils and i need to incorporate the adjustment (-20) into our latest figures on a invoice dated March 2011. How shall I list and account for the VAT now that it is at 20%?

I would be very grateful for your thoughts.

Thanks
Craig

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  • coojee
    coojee Registered Posts: 794 Epic contributor 🐘
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    I'd be inclined to do a credit note for the 20 children if it's already been invoiced. Sounds to me like they want to avoid the VAT by asking you to re invoice it. Just a thought, has the training already taken place and when did it happen?
  • Monsoon
    Monsoon Registered Posts: 4,071 Beyond epic contributor 🧙‍♂️
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    I would also issue a credit note for the value of 20 pupils at 17.5% (credit note VAT rate same as VAT rate on invoice to which it relates).
  • craggle87
    craggle87 Registered Posts: 24 New contributor 🐸
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    Hi, Thanks for your reply. Yes the training took place in Nov/Dec 2010. If I issue the credit will i have to date it as 31st December when the rate was 17.5%? I'm just wondering if they will allow that now that we are 2-3 months on.

    Cheers
  • Monsoon
    Monsoon Registered Posts: 4,071 Beyond epic contributor 🧙‍♂️
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    No you date it when you raise it. The VAT rate follows that of the rate of the invoice to which it relates, even if you raise the credit on a date where the rate is different.
  • Jan
    Jan Registered Posts: 654 Epic contributor 🐘
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    Just be careful if usig such as sage and you have altered T1 to 20% as it will automatically work it out at that rate!
  • Monsoon
    Monsoon Registered Posts: 4,071 Beyond epic contributor 🧙‍♂️
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    Good point. I only have one client on Sage and I've got T10 set up as 17.5% and T11 set up as 15% so if I have to post a transaction for a prior VAT rate I just use that code instead of T1 which is now set to 20%.

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