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REB1952
Level 2

VAT

Hi I am just starting on Quickbooks and my year goes from 1 June 2021. 

I appreciate I am behind and have some catching up to do.

I have gone to accounts and settings and put in my first month as June, I assume this automatically sets my financial year as 31 May 2022.

I have personalised my chart of accounts.

Next I am going to enter my opening TB as a journal dated 1 June, I assume this is the correct thing to do first.

Then I will create my bank feed and I will receive the last 90 days from my bank to post. 

I understand the previous 90 days I will be able to get as a CSV spreadsheet and upload into Quickbooks and then post.

I then want to connect to HMRC to file my VAT returns. Here I see a problem. My first VAT Return ends 31 July 2021. I have the creditor for May in my TB, but how will I be able to put in the May output VAT, Input VAT, net sales, etc. into my 31 July VAT Return?

I have asked HMRC to change My VAT quarter to correspond with my year end but they haven't done that yet.

Solved
Best answer November 16, 2021

Accepted Solutions
GeorgiaC
QuickBooks Team

VAT

Hi REB1952, the simplest way to do this for payments out is to create an expense (+ New > Expense) selecting the bank account under 'payment account', then choose the date that the payment was made, and enter the transaction details and amount (including any VAT) on the 'category details' line. 🙂

View solution in original post

21 REPLIES 21
Ashleigh1
QuickBooks Team

VAT

Hello REB1952, 

 

Welcome to the Community page, 

 

Yes what you have said is correct on what you need to do in Quickbooks this link here you may find helpful as well. In regards to your question about the VAT you can adjust the VAT return on the prepare return page in quickbooks in the taxes section if required 

REB1952
Level 2

VAT

Thank You. I just found it surprising that all you had to do to set up your financial year was enter a start month. What if you say changed your year end and had a long or short period, which does happen?

Presumably when entering my bank balance in the journal, I show it as "Opening Balance"?

In respect of the VAT, presumably the adjustments you refer to then do not effect my cumulative figures going forward? Is there a video I can watch on VAT adjustments?

EmmaM
QuickBooks Team

VAT

Hello Reb1952, When entering the bank balance as a journal, if it is an opening balance for that account yes you would use the bank account chart of account on line 1 and the opening balance equity account on the other(sometimes called retained profits balance forward). In regards to the financial year, if you changed the financial year so it was a different period then we could advise on how to amend that and close off the previous financial year, is this something that your accountant has advised you're going to be doing? The VAT adjustment option we do have an article on how to do that here 

REB1952
Level 2

VAT

Hi I have a whole list of assets and liabilities to enter to come to my retained profit, not just my bank balance do I do the whole thing direct in the chart of accounts?

Surely if I do one journal with about 25 entries it will all end up in the chart of accounts anyway?

REB1952
Level 2

VAT

Hi I am anxious that I get the opening bank balance entered correctly, as everything goes through my bank (a simple business) and I am aware that the opening bank balance is key because everything will reconcile back to this in future. I don't want to get going without getting this right!

Is it OK to enter all my opening assets, liabilities, equity, etc. (including my opening bank balance as journal number 1 date 1 June 2021, the start of my new accounting year.

MirriamM
Moderator

VAT

Hello again, @REB1952.

 

When creating a Journal entry, all the accounts affected will post on the Chart of accounts. Thus, either you enter one journal entry or multiple, everything will show on the Chart of Accounts. To verify, you can run your register. 

 

Here's how:

  1. In the left menu, click Accounting
  2. Go to the Chart of Accounts tab.
  3. Locate the accounts affected when creating the Journal entry.
  4. Under the Action column, click the View register link.

 

And when about to enter a Journal entry, you may consider consulting your accountant or accounting professional for guidance and what account receives the debit and credit side of the transaction.

 

For more details about this process, see this article: Create a journal entry in QuickBooks Online.

 

Keep me posted if you have any additional questions, as I'm always here to help. Take care.

REB1952
Level 2

VAT

Thanks. I fully understand Journals and debits and credits. No Problem. I just want to make sure that the opening bank balance appears as such in the bank account because I know Quickbooks then reconciles back to that figure.

Hence you are confirming that my opening journal dated 1 June 2021 of 25 entries, one of which will be "opening bank balance" say £100 credit, will be the opening balance for June that I will then reconcile to at the end of June?

MaryLandT
Moderator

VAT

Yes, you can credit the opening balance when you create a journal entry, REB1952.

 

However, let me provide additional insights about entering an opening balance for your bank.

 

Once you connect your bank, QuickBooks automatically creates an opening balance. The amount is based on the real-life bank account. Thus, it causes the incorrect balance in QuickBooks.

 

You need to check the Account history first to prevent double entries. Here's how:

 

  1. Go to the Gear ⚙️ icon at the right top.
  2. Select Chart of Accounts under Your Company.
  3. Locate the account, then click Account history under Action.
  4. Find the opening balance.
  5. You can either delete or edit it.
  6. Click Save and close.

 

Once done, you can continue creating the journal entry. Please know that we don't recommend journal entries, and that's we recommend consulting your accountant for some advice.

 

I'm also adding this link: Enter an opening balance for an account in QuickBooks Online to learn more about the process and when to enter it.

 

Keep me posted if you need additional information about entering an opening balance. I'm always right here to provide the information that you need.

REB1952
Level 2

VAT

Sorry, perhaps I should come clean, I am an accountant and therefore journals hold no fear for me, As yet I have entered nothing. This is my son's business and I am computerising his records to make it much easier for him going forward and to prevent him constantly getting into arrears as he is now.

Previously records have been done manually and I have an opening TB at 1 June 2021, which I need to enter by journal to get my starting point, with all my opening assets, liabilities, etc. including my opening bank balance.

However I have not used Quickbooks before. As I said it is a simple business and everything goes through the bank account.

I then intend to link to the bank account and I understand it will then download the last 90 days from let's say 15 September.

I will then down load 1 June to 14 September onto a spreadsheet and upload this to Quickbooks, which I understand is the best way to deal with the missing 3 months.

From what you say Quickbooks will automatically treat my opening bank balance as the balance at 15 September, the start date of the 90 day download?

In which case Quickbooks must post this somewhere in order to complete the double entry, presumably the P&L Reserve or similar?

If this is so then I will just need to do a journal to reverse this to bring everything back into balance, do you agree?

Once I have posted each month I should then be able to complete a reconciliation, but in reconciling say June 2021, I need quickbooks to show the opening balance as the one I enter by journal as of 1 June 2021, which is the correct balance.

 

MaryLandT
Moderator

VAT

Thanks for getting back to us, REB1952.

 

Yes, the opening balance is the start date of the 90-day download. For your manual entries, just make sure to record all transactions coming from the bank statements.

 

Once QuickBooks download transactions, you can simply match them to the one you've manually entered. That way, you'll be able to determine the ending balance for the first month of the Fiscal year.

 

The ending balance will then become the opening balance on your next reconciliation. If there's a discrepancy with the opening balance, you can enter a journal entry. Or just modify the opening balance entry from the previous reconciliation.

 

I'm adding these links in case you have issues with the reconciled accounts.

 

 

Stay in touch with me if you have follow-up questions about your entries in QuickBooks. Just leave a comment below, and I'll get back to you.

REB1952
Level 2

VAT

Hi I have given this some further thought myself and I wonder if perhaps the best thing will be to download the 6 months banking first and then do my opening journal?

What do you think?

Giovann_G
Moderator

VAT

Yes, I agree with that, REB1952.

 

You can import all of your bank transactions into QuickBooks before creating the opening journal. This is to ensure that your QuickBooks account and bank statement balances are identical.

 

Since most banks may only allow QuickBooks to download the previous 90 days transactions. You can get a CSV file from your bank for the past 6 months and manually upload them. I'll show you how.

 

  1. Sign in to your bank website and follow your bank's instructions to download CSV files.
  2. Log in to your QuickBooks account.
  3. Go to the Banking or Transaction menu.
  4. Select the Banking tab.
  5. Click the Link account dropdown and then Upload from file.
  6. Browse and select the file you downloaded from your bank, then Next.
  7. In the QuickBooks account dropdown, choose the account you want to upload the transactions into, then Next.
  8. Follow the onscreen steps to match the columns on the file with the correct fields in QuickBooks. Then select Next.
  9. Choose the transactions you would like to import, then hit Next and Yes to confirm.
  10. Once done, click Let's go.

 

You can refer to this article for more detailed information: Manually upload transactions into QuickBooks Online.

 

Once done, you can now start categorising and matching those transactions to put them into the correct accounts: Categorise and match online bank transactions in QuickBooks Online.

 

Let me know if you require further assistance with banking. We're always here to help you.

REB1952
Level 2

VAT

Hi,

I uploaded my bank transactions, but although I put in 1 June as the start date it actually downloaded from 2 June. Hence there are 10 transactions for 1 June (all payments) that are missing.

Can I simply enter these manually, which will be quickest for me as I do not have an excell spreadsheet facility on my computer or shall I get someone to upload the transactions from an excell spreadsheet for me?

Secondly the opening balance at 2 June does not agree with the bank statement - can I simply manually adjust this?

GeorgiaC
QuickBooks Team

VAT

Hi REB1952, thanks for your post! It's perfectly fine to enter these manually as expenses on the system, rather than importing a CSV of the missing transactions from your bank. As you are recording transactions from the 1st of June in QuickBooks, the opening balance should reflect the account balance at opening on this date.

 

You can manually edit the opening balance by locating this within the banks' Chart of Account (Cog > CoA > Account History > Click the 'date' heading to order from oldest > newest) and clicking on the transaction to edit the date/amount as required. Once this is correct, change the checkbox to 'R' to reconcile this - this will then show as the beginning balance when you come to reconcile the account. 👩‍💻

REB1952
Level 2

VAT

Hi Thanks.

What is the best way to enter them manually?

JessT
QuickBooks Team

VAT

Hi REB1952,

 

I've read the entire post, and I understand that you need help with entering your accounts' opening balances in June 2021. I'll continue to help you out.

 

You can go over the Debtors and Creditors accounts first. For Debtors, you can enter a lump sum invoice for each customer and enter all unpaid items in it. Make sure each item has the correct account assignments so that the amounts also reflect on them. For Creditors, create a lump sum bill for each vendor and use the unpaid items in the same way.

 

Alternatively, you can enter the customers' and vendors' opening balances as you add their profiles. QuickBooks will then create a lump sum invoice or bill with only one item, which means only one income or expense account is affected for each customer or vendor's balances. This works to some, but for some accountants, they want to have a breakdown of those balances. This is why I suggested creating an invoice and a bill listing all the unpaid items.

 

For Equity and all other Asset and Liability accounts, you can create a journal entry for each account type. I'll leave the entries with you since you're an accountant.

 

After dealing with the opening balances, you can start categorising and adding your downloaded bank transactions.

 

Any incurred amounts for income and expenses before June 1, can be entered manually via journal entry, so they will accomulate in your Profit and Loss report.

 

Lastly, I recommend checking your Profit and Loss and Balance Sheet reports as you enter transactions. Then, remember that you can always edit or delete any transactions if they are incorrect.

 

If you have other questions in mind, feel free to go back to this thread. Take care and good evening!

REB1952
Level 2

VAT

Thanks. I do not have a problem with my opening journal, but thanks for the explanation.

However you have not answered my question. What is the best way to enter my missing 10 bank payments from 1 June 2021 manually?

MaryJoyD
QuickBooks Team

VAT

I can share some information on how to add your missing transactions manually, @REB1952.

 

You can add your missing transactions through the WebConnect process. You’ll have to manually download the transactions from the bank. Then, upload the file to your account. 

 

 

Download bank transactions:

 

  1. Go to your online banking account to get your file.
  2. Check or follow your bank’s instructions to get a copy of the data and then save it on your computer.
  3. Ensure that the data range is at least one day before your oldest transaction to avoid duplicates.
  4. Please take note of the supported file format and size. It should be either a Comma-Separated Values (CSV) or a QuickBooks Online (QBO) file. 
  5. Download your transactions and save the file to your desktop.

 

To upload the file to your QuickBooks account: 

 

  1. Go to the Banking menu and select the bank where you’re uploading the transactions from the Banking tab.
  2. Click the Link account drop-down and select Upload from file
  3. On the window that appears, click the Browse button and choose the file that you’ll be downloading. 
  4. Click on Open, then Next.
  5. Follow the onscreen instructions. Match the columns on the file with the banking fields in QuickBooks, then select Next.
  6. Click on Let's go. QuickBooks will now add the transactions to your account.

 

Refer to this article for more information about getting transactions from your bank and import them into your account: Manually upload transactions into QuickBooks Online

 

After adding your transactions, you can now categorise and then reconcile them to ensure your books are accurate and there aren't any duplicate transactions.

 

Let me know if there’s anything else that I can assist with your bank transactions by leaving a comment below. I’m always here to assist. Have a wonderful day!

REB1952
Level 2

VAT

Can I refer you to the previous reply I received from Georgia:-

Hi REB1952, thanks for your post! It's perfectly fine to enter these manually as expenses on the system, rather than importing a CSV of the missing transactions from your bank. As you are recording transactions from the 1st of June in QuickBooks, the opening balance should reflect the account balance at opening on this date.

I would prefer to go this route because I do not have excel on my computer, I just want to know how to do this and if it will create any other problems?

GeorgiaC
QuickBooks Team

VAT

Hi REB1952, the simplest way to do this for payments out is to create an expense (+ New > Expense) selecting the bank account under 'payment account', then choose the date that the payment was made, and enter the transaction details and amount (including any VAT) on the 'category details' line. 🙂

View solution in original post

REB1952
Level 2

VAT

Hi

Just want to say a big thank you for all your help.

Everything now posted up to date, journals done and outstanding VAT returns done. Bank accounts reconciled.

THANK YOU

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