Hi there, our vat transactions go to our main control account. We report certain countries VAT on separate returns so when i prepare the uk return i have to exclude these balances as reported separately. I put these reductions to the vat return as an adjustment in QB. This creates an automated journal by QB called VAT adjustments. My thought process was to then journal this adjusted balance to other country control accounts but the VAT adjustments seem to still inflate the balance sheet, what do i do?
Hello there, @SL100.
Let me share additional information about how QuickBooks handles the changes you've made to your VAT-related transactions.
When you exclude the balances for the countries you're filling separately, decrease your taxable amount. It will show under Exception Amount column when preparing your next VAT returns. This is to ensure that no VAT collected or credits earned are missed or duplicated. You can run the vat exception report. This way you'd see the details of the changes made in QuickBooks. Here's how:
Lastly, you can create a journal entry to correct your balance. I'd recommend consulting with an accountant so you'd be assisted properly with reviewing your VAT setup in QuickBooks and the manual adjustments you've made.
I've added these articles to give you more insights on how the VAT exceptions report works:
Get back to us here if you have other questions or concerns. I'm always here to help.
Hi there, SL100!
With the scenario you have, it would be best if we'll have visuals to it, so we can trace the transactions. Please contact our Support team during the usual business hours in the UK. That way, they can use a screen-sharing tool and guide you while you're both looking on the same page.
If you have other questions, you can always go back to this thread.