I have scheduled monthly client invoices for which I use GoCardless to receive payments. All the GC mandates are imported so everything is automated. GC have announced that from September they are to start charging VAT on their fees so can you tell me how the automated process will work.
For example, if I have an invoice for £100 (incl vat), GC currently pays £99.90 into my bank account and QBO posts the £0.10 fee to my GoCardless Fees expense account.
Once GC start charging VAT, their deduction will be £0.10 + VAT of £0.02. So the net into my account will be £99.88. Therefore my question is, will the £0.12 all be posted to my GoCardless Fees account or will it be split as £0.10 to GoCardless Fees and £0.02 to VAT Control
Solved! Go to Solution.
Hello Community Users! We just wanted to come back to this thread to advise we updated the way the automation of Go Cardless fees accounts for the VAT now charged by them. So this should be posting correctly without needing to make any manual changes. Any questions just reply back here.
Hi Malc99 We have not been given any formal information in regards to the implementation as of yet. Your assumption is correct, that you will be notified once there is it is ready to be implemented.:clapping_hands:
Please can you confirm if there is any update on this issue? GoCardless are now charging VAT on their fees (as of 01/09/2020) and it would be helpful to know how this will be managed with the automatic processing of GoCardless payments & fees in QBO?
Hi ECaddy:waving_hand: At the moment it will be a case of manually accounting for this in QuickBooks as at the moment we've not been informed of any change to the integration of the app into QuickBooks. That's not to say there will be no change in the future, we've added your company to the list of users requesting the change to impact the app and how it pulls through fees.
Whilst I appreciate the update, it has been 2 months since I raised this issue and from the initial response Quickbooks have been aware of this for longer.
Given the prior notie of this change there must be a solution in the pipeline so can you advise when it will be delivered as manual adjustments are not a long term solution.
We understand the importance of this for you, however we aren't able to advise a specific timeframe as to when any changes to the process of the GoCardless integration within QuickBooks will be implemented. Rest assured your feedback is heard and our team are aware of the changes to the VAT on fees with GoCardless and are looking to adapt our system to reflect the accounting of this.
Has there been any update on this? I see the last reply was 2 weeks ago but we are in the same position. At the moment I am having to manually import American Express statements and manually adjust Go Cardless fees for VAT so Quickbooks is becoming quite cumbersome for a tool that is supposed to make accounting more efficient.
I also requested the formal complaints procedure from the support chat whilst logged in and was advised I should email that support agent and they would pass it on. I emailed the support agent my complaint on 14th August, had no reply so followed it up on 4th September and have had no reply to either email. For the money I pay each month it's a joke.
Hello AKUK, we can certainly contact the agent and make sure your formal complaint and email are answered from the case created by the support agent. Do you have a case number? There has not been an update on a future change to the Go cardless app to incorporate the changes to the fees. We' do take on board that it makes the feature more cumbersome. We want to reassure it's something our senior team are looking into what can be done in product.
I also contacted GoCardless support this morning about the same issue in case it was their fault rather than Quickbooks, their reply:
"I have checked this with the relevant team, yet it seems, in this case, I have to redirect you to QuickBooks itself to assist you as there must be internal settings that need to be adjusted to make sure VAT is shown correctly."
Can we get an urgent update on this? We need to account for VAT on GC fees but QBO seems to be automatically entering transactions (incorrectly).
If there's no update to the integration, how are people solving this manually? Where is the transaction that needs to be updated to include a VAT element?
I completely agree that it's not okay for Intuit to be taking so long on this, especially when they've been aware of the issue for months.
In the meantime I'm planning on getting a copy of the monthly invoice from GoCardless (click on the gear icon at top right, then Company Info and select the month you need from the dropdown in the Billing section), and then posting a manual journal in QB
A pain, but not sure what other option we have until Intuit pull their finger out.
I was fiddling around with this earlier and I think the easiest in the meantime is to find each deposit in your GoCardless Fees account, scroll to the bottom, change the additional deposits line to inclusive of VAT, and change to standard 20%.
What do you think?
I guess it depends on the volume of transactions. If you've 100s of deposits, the overhead of changing every one might be too great and a single journal could be more appropriate. Either way we're all going to have to find our own solution in the absence of a system fix.
Thanks for joining this thread. There has not yet been an update to the way the VAT is handled on GoCardless fees in QuickBooks since the introduction earlier this year. As a workaround in the meantime, you can locate the deposits in the Go Cardless Fees account and edit the 'additional fund's' line to inclusive of VAT, and set this to 20%. Please get back to us below if you have any Q's. :)
We are in the same position but for several companies. It is ludicrous to suggest a manual adjustment to every GoCardless deposit when we have to deal with 100s a month. The whole point of the GoCardless app in Quickbooks to avoid the necessity of manually dealing with large numbers of direct debit payments. We switched from a different online accounting package to get away from that. If we have to we will abandon Quickbooks too. On the other hand, a clear instruction on how to make a single manual VAT adjustment via a journal entry once a month or once a quarter will do for now.
Hi benspector You could however we recommend that you , allocate the VAT to the Go Cardless Fees account and edit the 'additional fund's' line to inclusive of VAT, and set this to 20%.
To everyone with this issue:
I tested changing the additional funds line to be inclusive of VAT and setting the VAT rate to 20%. However
I found that this does not change the amount of VAT due on VAT returns. I reported this behaviour to Quickbooks as the advice being given is clearly not giving the intended results. It seems like because the VAT part of the payment would get entered as a negative amount this is ignored in VAT calculations.
We decided that it would be better to make an adjustment when preparing a return, based on invoices from GoCardless.
I also suspect that this problem is also delaying Quickbooks from updating the integration, as otherwise it should be a simple fix for the developers to change the default VAT mode and percentage for the charges.
I hope this helps.
When I tested a few weeks ago it did show in the return but didn't change the VAT due amount. If you're going to adjust each payment I would just check first to see if its working for you (maybe it has been fixed).
I didn't test too much further at the time as we think making an adjustment manually on the return would be a lot faster for us than digging up and changing each payment anyway.
I'm no accountant but after some trial and error I think I may found a journal solution:
|GoCardless Fee Expense||[Net amount]||20% S (Purchases)|
|GoCardless Fee Expense||[Net amount]||----|
|GoCardless Fee Expense||[VAT amount]||----|
I also attach a copy of the GoCardless invoice as support.
The VAT return reflects the correct values in the VAT Due and Net value of purchases figures, so unless I've made a complete screw up, I think this is how I'll deal with it each month.
Happy to be corrected if this is wrong.