Question

Post Brexit VAT codes and entry

Forum|Forum|5 years ago
March 24, 2021
1 reply
4 views

Confused about post Brexit VAT codes and entries... QB Desktop Premier 2021.

We have imported goods from USA for years - the supplier invoice is entered (in US$) with VAT code E (0%). We pay VAT and duty to air air shipper on arrival - VAT amount gets posted to box 4 .

We claim back in VAT return.

Net Zero.

Nice and simple.

Post Brexit - I had assumed goods coming in from EU would be treated the same way - but so far we have not been presented with any VAT bills on arrival. I assume all the importers assume we want to do the postponed VAT thing (I would rather not thanks).

I am entering my suppliers bills also as VAT code E (0%).

So purchase value is recorded in total net purchase value on VAT return - box 7.

But nothing in any other boxes.

Now I got (2 months after it arrived) a document today from FedEx for the VAT value on one shipment from France - nothing to pay but presumably I have to account for this?

Seems all rather pointless... I have to put this VAT amount so its recorded in boxes 1 and 4 - so just cancels itself out... Cant I simply ignore doing this ?!!

If I have to record it - how ??

QuickBooks Desktop

E

EmmaM

Level 10

Hello Skinnerneil, What boxes are you wanting to hit? If you do not feel the post VAT accounting applies you could maybe use a reverse charge code , though that would hit boxes 1 and 4, it may be worth confirming with an accountant or HMRC for guidance on which is the best code for you to use.

S

skinnerneilAuthor

A specific example raised itself today.

We have a shipment of products just arrived in from France.

Supplier invoices total € 45926.04. I have entered into QB using code E (0% VAT).

That value is entered only onto VAT box 7 on QB (converted to sterling) - total net value of purchases.

Our importer did the paperwork for clearance - VAT to pay was £ 7943.88. But this value is IMMEDIATELY offset under the postponed VAT system by the same value credited back (all linked to our EORI number apparently). So net zero VAT. Goods arrived . Nothing to pay.

The official HMRC advice is here - https://www.gov.uk/guidance/complete-your-vat-return-to-account-for-import-vat

That says the VAT figure should be entered into Box 1 (sales VAT) and box 4 (purchase VAT).

Thus cancelling each other out.

My point is how do I enter this ? I do not have a bill ?? Journal entry ??

S

sr1962dl

Are you on desktop or online ?

My workaround is for desktop (Premier 2021).

I did not activate any PVA VAT codes ?...

I simply posted a journal with the import VAT amounts so it posts the VAT value to box 1 and 4 on my VAT100 report...

See screenshot attached.

Thanks, we're on QBO.

Thanks for the screenshot and will have a look. Don't know why QB can't sort this out, in Xero there is an option to add in these adjustments when viewing the VAT return.

Incredibly frustrating!

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