My client is moving to QB from using a spreadsheet to comply with MTD.
Most of the opening balances will be balance sheet codes. They have already setup there bank account and connected and downloaded transactions, from what i understanding this will put in the opening balance for the bank accounts. Is that correct?
My concern is how to enter any VAT liability?
When you connect the bank this should automatically record the opening balance as a bank deposit within the account but you may need to reconcile this.
To see if this has been created, go to Accounting > Chart of Accounts > Edit against the bank account, and select the 'Date' column heading to reorder from oldest-newest posting. The bank deposit will show here as the first entry, with an 'R' in the check column to mark as reconciled.
You can use a journal entry to enter opening balances for the accounts. As QuickBooks Online uses two control accounts for VAT liability (VAT Control and VAT Suspense) which are generated when you enter transactions with the QuickBooks Online VAT codes, to post VAT liability you would need to either enter transactions with VAT codes applied or a journal entry with VAT codes on the account lines to hit the necessary boxes. Please note, if you create a journal directly to the VAT Control account this will not post to the VAT reports.
Hi userian, thanks for joining this thread. You can enter all opening balances using a journal entry, however, if you're unsure what specific account to offset this against on the journal we'd recommend reaching out to a bookkeeper/ accountant for best advise