We often have
queries regarding VAT that usually arise from a lack of understanding
on how to use the VAT reports that are included with EXACT accounting.
VAT processing is really very simple and should be done as a matter
of course, preferably every month.
Why do we say that, even though the VAT period spans two months? It
is because if you make it part of your monthly routine you will be
less likely to forget to do it and because checking one month's transactions
is easier to do (and correct if there was an error) than trying to
do two months.
The biggest sources of errors occur when:
a ] the VAT returns are submitted without being checked and
b] where transactions are posted into a period for which the VAT returns
have already been submitted. This is why we recommend closing your
Customers, Suppliers and Ledger accounts at the end of each month
after all transactions have been carried out.
The VAT checking procedure is as follows:
1] Complete
the processing of Customers invoices, Suppliers invoices and Journal
entries for the month:
2] Go to [General Ledger][Reports][Vat
Report] and print out the Detailed VAT report
You will see that there is a sumary of how to check your VAT in
a yellow screen above the report selection area, as follows:
1] Verify the VAT on sales against the summary invoices
report spanning the same period.
2] VAT on purchases needs to be checked carefully for operator data
entry errors.
3] VAT on the total sales invoice 'round down' amount must be processed
manually.
3] Follow the instructions above: The summary invoice
report is found in [Customers][Reports].
Data entry errors are errors such as claiming VAT on purchases such
as fuel, travel, non-vattable items or items purchased from non-registered
vendors.
4] Once you are satisfied that the transactions
are correct, close the debtors and vendors accounts [Periodic
processes][End of Month] as well as the ledger [General
Ledger][Maintenance][Close Ledger Period] in order to prevent
any operator from inadvertently processing a transaction that has
VAT implications to the period you have just processed.
That's it!
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