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Level 1

How do I record VAT payment to HMRC for VAT filed under old software

I have just started using QB.  My last VAT return was submitted using a different software but the payment needs to be entered on QB.  I have entered an opening balance in the VAT suspense account for the VAT liability.  I cannot select VAT suspense when creating a bank payment as that is not allowed.  As I have not filed a return under QB the option to record payment under Taxes is not there.  Please help someone as this is driving me nuts and I am ready to cancel subscription!!!

 

Thanks

9 REPLIES 9
QuickBooks Team

Re: How do I record VAT payment to HMRC for VAT filed under old software

Hey ChampionT,

 

Welcome back to the Community Page for QuickBooks Online.

 

I've tested this in my account, and Instead of trying to add the bank deposit to VAT suspense from the Banking Screen. Click on the Plus Icon in the top right hand corner of the page and select Bank Deposit from there

 

Set Tax Selection both to "Amounts are NO VAT" on the right hand side of the Deposit.

Set the Date to match the Transaction in your Bank Account

Set the Account box as VAT Suspense and type in the Amount of the payment.

Press Save and Close.

 

This should allow you to save, without the restrictions on the Banking Screen. When you return to the banking screen, you should find a Match, providing the Date and Amount also match the banking screen.

 

Please let me know if i can help any further

Level 1

Re: How do I record VAT payment to HMRC for VAT filed under old software

Sorry but that just created a deposit into the bank account.

QuickBooks Team

Re: How do I record VAT payment to HMRC for VAT filed under old software

Hello ChampionT,

 

The VAT Control/Suspense accounts are not meant to be used for any VAT payments prior to using QuickBooks. Instead, you would create an expense account named VAT payment (or anything you would like) to record this payment against, as a one off. Delete opening balance you have created, as this will affect the account balance going forward, once QuickBooks starts posting to this automatically.

 

Thanks,

Talia

Level 1

Re: How do I record VAT payment to HMRC for VAT filed under old software

Surely there has to be an amount in the opening balance for VAT liability/suspense as this would be on the year end balance sheet from the previous software?

I have to say QB's is one of the most complicated pieces of accounting software that I have used to date.  The help facility just seems to be community only (which I am not knocking but you end up getting conflicting advise). Is there a start up help facility, showing you how to enter all the opening balances etc and what to do in circumstances such as this?  I am having to search for everything that I am trying to do. 

I use Sage, Xero and Kashflow for my other clients and have not come across any of these complicated issues.  It should all be simple and straightforward.  Frustrated!! Grrrr

QuickBooks Team

Re: How do I record VAT payment to HMRC for VAT filed under old software

Thanks for coming back to Online Community, ChampionT.


Allow me to share some further insight into recording VAT payments coming from your previous software.


The answers provided by @TaliaI  should help resolve your concern. Another way of handling this issue is to adjust the VAT account, so you can enter previous tax payments in QuickBooks.


However, perform the process per box to ensure the amounts are properly reported on the VAT return.


For box 1, 2 and 4:

 

  1. Log in to your QBO company, then go to the Taxes panel on the left.
  2. Choose VAT.
  3. In the Returns section, click on the Submit return link for the form you’re working on.
  4. Click on the Adjust link for the VAT line you want to change.
  5. On the Adjust VAT page, make sure to enter the correct Adjustment Date and VAT rate.
    NOTE: If you do not select the correct VAT code, the information will not be reflected in the reports or return.
  6. Select the correct posting account by clicking on the Adjustment Account drop-down.
    *If you are making the adjustment because you received credit and you owe less VAT to the government, choose an income account that you create for this purpose.
    *If you are making the adjustment to include a fine, penalty, or interest on a VAT return, choose an expense account, such as Interest Expense or Non-deductible Penalties.
  7. Input the amount in the Adjustment amount field box.
  8. Click on Save.

Once done, proceed to the other boxes. You’ll find the step by step process in the Adjust your VAT liability article and go directly to the adjust VAT box 6, 7, 8 and 9 section.


After completing these steps, the previous year transactions should show in QBO.


Please let me know how this turns out or if you need further assistance with these steps by leaving me a comment. I'll be right here ready to help.

 

Level 1

Re: How do I record VAT payment to HMRC for VAT filed under old software

Thank but I'm not sure why you have given instructions to submit an adjustment to VAT return. Please refer to my original question. The return was submitted in previous software which also coincided with financial year end. The VAT liability needs to be entered in QuickBooks as opening balance. The payment to HMRC was made after year end and also needs to be entered in QuickBooks. I am simply asking how to do both and for some reason it is clearly not as straightforward as it should be. Where can I find full instructions provided by QuickBooks to enter a simple opening balance and then create payment ?

QuickBooks Team

Re: How do I record VAT payment to HMRC for VAT filed under old software

Hello again, ChampionT.


I want to ensure you’re pointed in the right direction, so the VAT payment is recorded in QuickBooks.

 

Since the transaction was paid prior using the software, you'll have to create a journal to track it. This is to keep the records in tiptop shape. 

 

 

Every business is unique, I suggest reaching out to your accountant for additional guidance. They can ensure the correct account is used to debit and credit the transaction.


This should help you move forward. If you have any follow-up questions, please let me know by leaving a comment below. I’ll be right here to answer them.

 

Level 1

Re: How do I record VAT payment to HMRC for VAT filed under old software

This is not working for me. I have tried to do as you say and create the bank deposit but it credits the account the amount I need to deduct from there for the VAT payment I made during the time before quick books. Please let me know how I should record this payment for VAT to the HMRC

QuickBooks Team

Re: How do I record VAT payment to HMRC for VAT filed under old software

Hello Vik1,

 

The best way to record a past VAT payment is to create an expense account (Accounting > Chart of Accounts > New) and then record the expense against this account - going forward the system will use the VAT Suspense/Control accounts for future payments, however to record a payment for a past period, you can use this account as a one-off. 

 

Thanks,

 

Talia