Hello, I just joined the community, and I have a question. I just started using Quickbooks pro for bookkeeping, I am used to sage account. In sage VAT payable to HMRC shows in liability nominal code, which when a company pays HMRC, it is posted to the nominal code to reduce the liability.
I don't know how to do this in Quickbooks, as the software have Vendors, where all account payable are or created. so If I do it as I understand, I would create VAT account on Vendors, create a bill, then pays it. This amount do not reduce the VAT liability. So I must be wrong. VAT returns are not submitted through Quickbook, I run VAT 100 report in Quickbook, then copy the figures to HMRC VAT return online.
Please how do I post VAT payment in Quickbooks, so that it can reduce the VAT liability. Thank you for your reply.
In Quick Books, you will need to set up HMRC VAT as a supplier. You do this by going to the Supplier Centre and find HM Revenue & Customs in the Active Suppliers list (when you set up VAT in Edit/Preferences in the VAT tab on the left side, then select Company Preferences, you will see the question "Do you charge VAT?". Here you select Yes and when you close the preferences box, this will create the supplier noted above.
In the HM Revenue & Customs supplier, you will need to double click on the supplier name, then go to VAT Settings. The check box Supplier is a VAT Agency should be set. The VAT registration number should be displayed - it is only editable though by going to Company/Company Information. In this tab, though, you can set the VAT quarterly reporting periods, and the accounts where VAT is controlled, although these will have been pre-defined when you set up VAT first of all.
When you run the File VAT command, this will generate the VAT 100 report and will also mark all the transactions included in the return you are submitting. Failure to do this task will mean that future VAT100 reports may well be incorrectly inflated by including transactions not previously so marked.
When the File VAT command is executed, QB will generate either an immediate bank payment or setup a creditor balance in the Pay Bills utility for the amount outstanding. Then when you make the subsequent payment in the Bank, you do this by means of the Pay Bills utility.