Allow me to share some insights about your VAT for car leasing.
If your organization is VAT-exempt, such as an educational academy or an eligible charity, then different rules apply. In case you purchase some items for both business and personal use, you can only claim the VAT proportion that is related to your business. To support your claim, you must maintain records showing how you arrived at the business proportion of the purchase. Additionally, it is mandatory to have valid VAT invoices.
To start with, you need to create a VAT Payment with a VAT rate of 20%. Next, you should record your invoice for the Initial Rental amount of £3646.86, and apply the VAT you created earlier to get the total amount. After that, this would lead you to record a VAT Refund.
Here's how:
- Go to Taxes and select VAT (Take me there).
- Select the All returns dropdown menu, then choose the specific VAT period you need.
- Select the View Summary dropdown menu, then select Record Refund.
- Select the bank account the refund has gone into.
- Make sure you've selected Refund under Payment Type.
- Enter the refund date and amount in the appropriate fields.
- Add a memo if needed.
- Select Save.
This will create a new transaction in your books.
To ensure you record the account accurately, I recommend reaching out to your accountant.
If you want to record a VAT payment in QuickBooks Online, you will be recording it against a specific VAT period instead of transferring money to HMRC, here is an article: Record a VAT payment or refund in QuickBooks Online
Please do leave a reply if you have further questions or clarification, the Community is here 24/7. Keep Safe!
