When preparing VAT returns, you may see a column titled Exception Amount in QuickBooks Online.
What are VAT exceptions?
The amounts in this column represent transactions you have previously filed for, but have since changed, deleted or added. This is to ensure that no VAT collected (or credits earned) are missed or duplicated.
A few reasons for exceptions are if you make changes to:
- A transaction in a filed period. For example, one that has been added, edited or deleted.
- A VAT code. QuickBooks will factor the difference between amount filed and the new value, sometimes this can be a net 0 difference. For example, changing VAT code 0% to be Exempt.
- The amount. Quickbooks will factor the difference between amount and filed and the new value.
- An income/expense account line. The net 0 difference will show.
- A customer/supplier. The net 0 difference will show.
How to create exceptions in QuickBooks
To create an exception:
- Delete a transaction to create a negative exception value
- Create a transaction to create a positive exception value
- Add another line item to an existing transaction
- Remove a line item to an existing transaction
- Change a VAT code (this may cause positive or negative exception values)
If you're unfiling a VAT return and need to create exceptions, you may want to consider moving them into your current VAT period, and setting the correct date once changes to the VAT return have been made.
What if I need to change the amount of my filing in QuickBooks Online and there are other factors that need to be accounted for?
How to determine if exceptions can be removed
Check the following options:
- What is the date of the first VAT filing in QuickBooks Online.
- Run the VAT exception report.
- Check if any of the exceptions are dated on or after the first filing.
If YES - These are classed as genuine exceptions and will not be removed.
If NO - please contact support to have a VAT exception removal processed.
If there is no date on the transaction, this would suggest the transaction has been deleted and you'll need to click into the transaction to find the create date.