cancel
Showing results for 
Search instead for 
Did you mean: 
Not applicable

How to enter VAT from Imported goods

We import goods into the UK from a number of countries, and I'm trying to enter the VAT we pay on those imports onto the system, so the values are deducted from our VAT that's due.
The method of entering those values has changed from the previous QB version I was using, and I can find no mention of it in the support documentation.
8 REPLIES 8
Frequent Contributor **

You will need to enter the invoices with vat code of O an...

You will need to enter the invoices with vat code of O and then when you get the clearing agents invoice for vat paid on import enter a vat only invoice for the vat.
You will need a new expense account called import Vat paid and add a line to the clearing agents invoice for zero value nett vat code of S and edit the vat box to include the vat paid.

Not applicable

Hi Graceman, I have entered the vat and admin invoice in...

Hi Graceman,

I have entered the vat and admin invoice in that way. It did work and the total vat figure can be seen in the VAT return report so it will be claimed back for Box 4.

However there is also a net amount figure being shown in the vat report. For example, I was testing it out on the sample company. The S Vat rate on that is 17.5%. I entered an invoice of wholly vat paid to DHL of 300.00. So while the 300 shows in the vat return to be claimed (box 4) there is also a net amount figure of 255.32 shown before it. Is that not artificially inflating the expense account?

The entry shows detailed in Box 7 as DHL invoice but with no figure at all. So is this net figure showing in Box 4 nothing to worry about?

My alternative was to just create a new VAT category called T - Total VAT and rate it at 100%. And use this as default for the Import VAT account. Is there anything wrong with doing that?

Thanks
Frequent Contributor **

you cannot have entered it correctly as the nett figure e...

you cannot have entered it correctly as the nett figure entered on the form against the expense account should be zero with vat code s and then edit the vat box to add in the vat of £300. You might find that entering the 300 into the vat box changes the nett to 255.32 so just clear it.
If the nett is set to zero this is what is recorded in the expense account.

You can create the vat code as you wish but remember you get two transactions one when you enter the invoice which is outside of vat and one for import vat paid. These are to two different suppliers but are related.
Not applicable

Ok, I didn't quite get your last bit. Are you saying in Q...

Ok, I didn't quite get your last bit. Are you saying in Quickbooks you have to somehow link the two, apart from me knowing they are linked?
Frequent Contributor **

Yes you know they are linked but if in 6 months are asked...

Yes you know they are linked but if in 6 months are asked would you remember this so use the option of creating an expense account called "import vat paid" and when you enter the clearing agents bill you add a line for the import vat by using this expense account with zero nett value S code and then edit the vat box to add in the full vat amount paid.
Use the C79 doc reference in the memo line to tie all this up same for the supplier invoice entry use the C79 doc ref, this document you will receive shortly after the goods are cleared.

The expense account will show zero value as the nett value posted is always zero.
Not applicable

Okay, so there's no actual technical linking apart from q...

Okay, so there's no actual technical linking apart from quoting the reference in the memo line?
Community Explorer **

Re: You will need to enter the invoices with vat code of O an...

Hi Gordon,

 

When you said "You will need to enter the invoices with vat code of O", is it ok to use the vat code 0.0% Z ? Or should we create a new vat code for it?

 

Thank you

Riza

Highlighted
QuickBooks Team

Re: You will need to enter the invoices with vat code of O an...

Good day to you, Riza!

 

There are preset VAT codes with zero rates in QuickBooks. You can select the one that applies to your business. If you're unsure about it, I would suggest reaching out to your tax advisor or accountant since we're unable to do tax advice here.

 

If you need to create a sales tax item with zero rate, you can follow these steps:

  1. From the Edit menu, choose Preferences.
  2. On the Preferences window, select Sales Tax then go to the Company Preferences tab.
  3. Click the Add sales tax item button.
  4. In the Type drop-down, select Sales Tax Item.
  5. Enter the tax name, rate, and select your tax agency.
  6. Click OK.

The Community team is always here for your questions.