Hi, Our VAT on purchases goes to a tax expense code in the P&L. How do I change it to go to the VAT receivable code in the balance sheet?

Good day, info,

QuickBooks Online uses the Suspense Account to record the purchased and collected sales tax. This is the reason why changing VAT on purchases to show in the Balance Sheet is unavailable.

By the end of the year, QBO will offset all the transactions from that account and will show the total sales tax to pay.

If you want to track sales tax on purchases, you can go directly to the Suspense account and check the decreasing side of it. Here's how:

1. Click Accounting on the left pane.
2. Select Chart of Accounts.
3. Locate Tax Suspense account.
4. Click Decrease on the menu to see all the transactions.

If you got additional questions about reclaimable tax, just leave a comment below.

hello -- i need to create IN/OUT vat for a NL based client with EU suppliers. currently, I can only set a VAT tax rate which inflates my accounts payable (100) while creating a VAT liability (21) and an Expense (79). The 21 should be offset against a VAT receivable as per EU Tax Treatise. How do I make affect this in QBO? 

Thanks for joining this thread, finacct1.

You can make an adjustment to increase your VAT liability covering the receivables in QuickBooks Online. To do that:

1. Go to Taxes, then select Prepare return for the period you want.
2. In the Vat line, select Adjust.
3. Enter the Adjustment Date and Vat rate.
4. Pick and Adjustment Account from the drop-down menu.
5. Add the amount to adjust, then click Save.

When you enter a tax adjustment, QuickBooks automatically adds a general journal entry to show the adjustment. And, it is shown in the related section of the Tax Detail report.

I've added this link for more details: Make tax adjustments in QuickBooks.

Let me know if you need anything else aside from your VAT returns. I'm always right here to help you.