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Thanks for providing on-point details about your concern, @YYC.
Creating journal entries for prepaid expenses doesn't include the VAT calculation. This is the reason the VAT report shows R0.00 and your prepaid expense balance displays R90.00.
To help fix this, you'll have to delete the two journal entries. Then, let's use the Expense feature to make an advance payment worth R100 to your supplier. By doing so, you can effectively manage your supplier balances and tax amounts.
Please first make sure to have the supplier listed in the program. Once done, you can perform the steps below:
The first screenshot below shows you the last five steps.
To learn more about this process, go through this article: How to Record the Advance Payment Made to Suppliers.
Once done, you can create a bill to record the actual services of R11.50. Just make sure to choose Prepaid expenses as Category. Then, choose Inclusive of Tax in the Amounts are drop-down menu. Also, select Standard 15% as the VAT type. See the second screenshot below for your visual reference.
After that, go to the Expenses tab and locate the bill. Then, click Make Payment from the Action column (see the third screenshot below). This lets you apply the expense against the bill. Once done, save the transaction.
You can run the VAT Summary report to see the summary information for each box on your VAT return. This will help you as you complete and submit your return to your VAT agency. For more details about the filing and payment process, visit this article: File and Pay Tax/GST.
I'll be right here to help if there's anything else you need. See you around and take care always, @YYC.
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