1. The VAT Return

2. Session Objectives 1.Correctly extract VAT information from financial records. 2.Correctly prepare VAT accounts incorporating adjustments. 3.Correctly complete VAT returns incorporating adjustments. 4.Correctly identify the due date for a VAT return. 5.Correctly identify the VAT payment due date in a given scenario.

3. Source Documents/Records Revision

4. Due Dates VAT return & Payment Paper Return& PaymentLast day of the month FOLLOWING the period end. Online Return- As above PLUS 7 calendar days Payment by Direct Debit - As above plus 3 bank days Page 21 of reference material Give out calendar

5. Question 1 Due Dates VAT return & Payment VAT Period ending... Date if using Paper return (VAT100) (Inc pmt by chq) Date if using online return Due date of payment for online Date if HMRC have DD authority 31/1/20XX 30/6/20XX 31/12/20XX 28/2/20XX

6. Due Dates VAT return & Payment VAT Period ending... Date if using Paper return (VAT100) (Inc pmt by chq) Date if using online return Due date of payment for online Date if HMRC have DD authority 31/1/20XX28/2/20XX 30/6/20XX 31/12/20XX 28/2/20XX

7. Due Dates VAT return & Payment VAT Period ending... Date if using Paper return (VAT100) (Inc pmt by chq) Date if using online return Due date of payment for online Date if HMRC have DD authority 31/1/20XX28/2/20XX7/3/20XX 30/6/20XX 31/12/20XX 28/2/20XX

8. Due Dates VAT return & Payment VAT Period ending... Date if using Paper return (VAT100) (Inc pmt by chq) Date if using online return Due date of payment for online Date if HMRC have DD authority 31/1/20XX28/2/20XX7/3/20XX 30/6/20XX 31/12/20XX 28/2/20XX

9. Due Dates VAT return & Payment VAT Period ending... Date if using Paper return (VAT100) (Inc pmt by chq) Date if using online return Due date of payment for online Date if HMRC have DD authority 31/1/20XX28/2/20XX7/3/20XX 10/3/20XX 30/6/20XX 31/12/20XX 28/2/20XX Now it’s your turn! Complete the rest of the table

10. Due Dates VAT return & Payment VAT Period ending... Date if using Paper return (VAT100) (Inc pmt by chq) Date if using online return Due date of payment for online Date if HMRC have DD authority 31/1/20XX28/2/20XX7/3/20XX 10/3/20XX 30/6/20XX31/7/20XX7/8/20XX 10/8/20XX 31/12/20XX31/1/20XX7/2/20XX 10/2/20XX 28/2/20XX31/03/20XX7/4/20XX 10/4/20XX

11. VATAccount Revision of the

12. VATAccount VAT on Purchases (Input Tax) XVAT on Sales (Output Tax) X Less Credit Notes(X)Less Credit Notes(X)

13. VATAccount VAT on Purchases (Input Tax) XVAT on Sales (Output Tax) X Less Credit Notes(X)Less Credit Notes(X) VAT on ImportsX

14. VATAccount VAT on Purchases (Input Tax) XVAT on Sales (Output Tax) X Less Credit Notes(X)Less Credit Notes(X) VAT on ImportsXVAT on Scale ChargeX

16. VATAccount VAT on Purchases (Input Tax) XVAT on Sales (Output Tax) X Less Credit Notes(X)Less Credit Notes(X) VAT on ImportsXVAT on Scale ChargeX VAT Acquisitions (EU)X X

17. VATAccount VAT on Purchases (Input Tax) XVAT on Sales (Output Tax) X Less Credit Notes(X)Less Credit Notes(X) VAT on ImportsXVAT on Scale ChargeX VAT Acquisitions (EU)X X Bad debt reliefX

18. VATAccount VAT on Purchases (Input Tax) XVAT on Sales (Output Tax) X Less Credit Notes(X)Less Credit Notes(X) VAT on ImportsXVAT on Scale ChargeX VAT Acquisitions (EU)X X Bad debt reliefXVAT on Goods for own use X

19. VATAccount VAT on Purchases (Input Tax) XVAT on Sales (Output Tax) X Less Credit Notes(X)Less Credit Notes(X) VAT on ImportsXVAT on Scale ChargeX VAT Acquisitions (EU)X X Bad debt reliefXVAT on Goods for own use X Error AdjustmentsX X

20. Question 2 VATAccount

21. Question 2 VATAccount Sales Day Book

22. Question 2 VATAccount Sales Day Book5,600 If you are dealing with more than one month, split into months

23. Question 2 VATAccount Sales Day Book5,600 Sales Returns DB(320)

24. Question 2 VATAccount Purchase Day Book3,410Sales Day Book5,600 Sales Returns DB(320)

25. Question 2 VATAccount Purchase Day Book3,410Sales Day Book5,600 Purchase Returns DB0Sales Returns DB(320)

26. Question 2 VATAccount Purchase Day Book3,410Sales Day Book5,600 Purchase Returns DB0Sales Returns DB(320) Cash Receipts Book

27. Question 2 VATAccount Purchase Day Book3,410Sales Day Book5,600 Purchase Returns DB0Sales Returns DB(320) Cash Receipts Book400

28. Question 2 VATAccount Purchase Day Book3,410Sales Day Book5,600 Purchase Returns DB0Sales Returns DB(320) Cash Payments BookCash Receipts Book400

29. Question 2 VATAccount Purchase Day Book3,410Sales Day Book5,600 Purchase Returns DB0Sales Returns DB(320) Cash Payments Book705Cash Receipts Book400

30. Question 2 VATAccount Purchase Day Book3,410Sales Day Book5,600 Purchase Returns DB0Sales Returns DB(320) Cash Payments Book705Cash Receipts Book400 4115

31. Question 2 VATAccount Purchase Day Book3,410Sales Day Book5,600 Purchase Returns DB0Sales Returns DB(320) Cash Payments Book705Cash Receipts Book400 4,1155,680 Input VAT Output VAT VAT due £1565

33. Use info on return to help with what goes where

34. Box number Entry to be made in box 1 2 3 4 5 6 7 8 9

35. Box number Entry to be made in box 15680.00 (From VAT Account) 2 3 4 5 6 7 8 9

36. Box number Entry to be made in box 15680.00 20.00 (No trade with EU) 3 4 5 6 7 8 9

37. Box number Entry to be made in box 15680.00 20.00 35680.00 (Box 1 + Box 2) 4 5 6 7 8 9

38. Box number Entry to be made in box 15680.00 20.00 35680.00 44115.00 (From VAT Account) 5 6 7 8 9

39. Box number Entry to be made in box 15680.00 20.00 35680.00 44115.00 51565.00 (Box 3 – Box 4) 6 7 8 9

40. Box number Entry to be made in box 15680.00 20.00 35680.00 44115.00 51565.00 628000+2000-1600(SRDB) = 28400 7 8 9 Net Sales figures

41. Box number Entry to be made in box 15680.00 20.00 35680.00 44115.00 51565.00 628000+2000-1600(SRDB) = 28400 7(3525+1610) + (15000+3050) = 23185 8 9 Net Purchase figures

42. Box number Entry to be made in box 15680.00 20.00 35680.00 44115.00 51565.00 628000+2000-1600(SRDB) = 28400 7(3525+1610) + (15000+3050) = 23185 80 (No EU Trade) 9

43. Box number Entry to be made in box 15680.00 20.00 35680.00 44115.00 51565.00 628000+2000-1600(SRDB) = 28400 7(3525+1610) + (15000+3050) = 23185 80 90 (No EU Trade)

44. Question 3 1.Consider the information you have been given 2.Total up the day books & Cash books

45. Complete the VAT account Use a break down of months if you are given the information in this format

46. Question 3 VAT account

47. Question 3 VAT account Credit purchases March (PDB) 3600.00

48. Question 3 VAT account Credit purchases March (PDB) 3600.00 Credit purchases April (PDB) 3400.00

49. Question 3 VAT account Credit purchases March (PDB) 3600.00 Credit purchases April (PDB) 3400.00 Credit purchases May (PDB) 3200.00

50. Question 3 VAT account Credit purchases March (PDB) 3600.00Credit sales March (SDB)4600.00 Credit purchases April (PDB) 3400.00Credit sales April (SDB)4200.00 Credit purchases May (PDB) 3200.00Credit sales May (SDB)4800.00

51. Question 3 VAT account Credit purchases March (PDB) 3600.00Credit sales March (SDB)4600.00 Credit purchases April (PDB) 3400.00Credit sales April (SDB)4200.00 Credit purchases May (PDB) 3200.00Credit sales May (SDB)4800.00 Cash purchases March (CB)320.00 Cash purchases April (CB)480.00 Cash purchases May (CB)400.00

52. Question 3 VAT account Credit purchases March (PDB) 3600.00Credit sales March (SDB)4600.00 Credit purchases April (PDB) 3400.00Credit sales April (SDB)4200.00 Credit purchases May (PDB) 3200.00Credit sales May (SDB)4800.00 Cash purchases March (CB)320.00Cash sales March (CB)400.00 Cash purchases April (CB)480.00Cash sales April (CB)200.00 Cash purchases May (CB)400.00Cash sales May (CB)400.00

53. Question 3 VAT account Credit purchases March (PDB) 3600.00Credit sales March (SDB)4600.00 Credit purchases April (PDB) 3400.00Credit sales April (SDB)4200.00 Credit purchases May (PDB) 3200.00Credit sales May (SDB)4800.00 Cash purchases March (CB)320.00Cash sales March (CB)400.00 Cash purchases April (CB)480.00Cash sales April (CB)200.00 Cash purchases May (CB)400.00Cash sales May (CB)400.00 Total tax deductible11400Total tax payable14600

54. Question 3 VAT account Credit purchases March (PDB) 3600.00Credit sales March (SDB)4600.00 Credit purchases April (PDB) 3400.00Credit sales April (SDB)4200.00 Credit purchases May (PDB) 3200.00Credit sales May (SDB)4800.00 Cash purchases March (CB)320.00Cash sales March (CB)400.00 Cash purchases April (CB)480.00Cash sales April (CB)200.00 Cash purchases May (CB)400.00Cash sales May (CB)400.00 Total tax deductible11400Total tax payable14600 Less: Total tax deductible(11400)

55. Question 3 VAT account Credit purchases March (PDB) 3600.00Credit sales March (SDB)4600.00 Credit purchases April (PDB) 3400.00Credit sales April (SDB)4200.00 Credit purchases May (PDB) 3200.00Credit sales May (SDB)4800.00 Cash purchases March (CB)320.00Cash sales March (CB)400.00 Cash purchases April (CB)480.00Cash sales April (CB)200.00 Cash purchases May (CB)400.00Cash sales May (CB)400.00 Total tax deductible11400Total tax payable14600 Less: Total tax deductible(11400) Payable to HMRC3200

56. Box numberEntry to be made in box 1 (Output VAT) 2 (VAT due on EC Sales) 3 (Total box 1 & 2) 4 (Input VAT) 5 (VAT Due/Reclaimable) 6 ( Total of Outputs) 7 (Total of Inputs) 8 (EU Sales) 9 (EU purchases)

57. Box numberEntry to be made in box 1 (Output VAT) 13600+1000 = 14,600.00 2 (VAT due on EC Sales) 3 (Total box 1 & 2) 4 (Input VAT) 5 (VAT Due/Reclaimable) 6 ( Total of Outputs) 7 (Total of Inputs) 8 (EU Sales) 9 (EU purchases)

58. Box numberEntry to be made in box 1 (Output VAT) 13600+1000 = 14,600.00 2 (VAT due on EC Sales) 0.00 3 (Total box 1 & 2) 14,600.00 4 (Input VAT) 5 (VAT Due/Reclaimable) 6 ( Total of Outputs) 7 (Total of Inputs) 8 (EU Sales) 9 (EU purchases)

59. Box numberEntry to be made in box 1 (Output VAT) 13600+1000 = 14,600.00 2 (VAT due on EC Sales) 0.00 3 (Total box 1 & 2) 14,600.00 4 (Input VAT) 10200+1200 = 11,400.00 5 (VAT Due/Reclaimable) 6 ( Total of Outputs) 7 (Total of Inputs) 8 (EU Sales) 9 (EU purchases)

60. Box numberEntry to be made in box 1 (Output VAT) 13600+1000 = 14,600.00 2 (VAT due on EC Sales) 0.00 3 (Total box 1 & 2) 14,600.00 4 (Input VAT) 10200+1200 = 11,400.00 5 (VAT Due/Reclaimable) 14600-11400 = 3200.00 6 ( Total of Outputs) 7 (Total of Inputs) 8 (EU Sales) 9 (EU purchases)

61. Box numberEntry to be made in box 1 (Output VAT) 13600+1000 = 14,600.00 2 (VAT due on EC Sales) 0.00 3 (Total box 1 & 2) 14,600.00 4 (Input VAT) 10200+1200 = 11,400.00 5 (VAT Due/Reclaimable) 14600-11400 = 3200.00 6 ( Total of Outputs) 66000+2000+5000 = 73,000 7 (Total of Inputs) 8 (EU Sales) 9 (EU purchases)

62. Box numberEntry to be made in box 1 (Output VAT) 13600+1000 = 14,600.00 2 (VAT due on EC Sales) 0.00 3 (Total box 1 & 2) 14,600.00 4 (Input VAT) 10200+1200 = 11,400.00 5 (VAT Due/Reclaimable) 14600-11400 = 3200.00 6 ( Total of Outputs) 66000+2000+5000 = 73,000 7 (Total of Inputs) 44000+7000+6000 = 57,000 8 (EU Sales) 9 (EU purchases)

63. Box numberEntry to be made in box 1 (Output VAT) 13600+1000 = 14,600.00 2 (VAT due on EC Sales) 0.00 3 (Total box 1 & 2) 14,600.00 4 (Input VAT) 10200+1200 = 11,400.00 5 (VAT Due/Reclaimable) 14600-11400 = 3200.00 6 ( Total of Outputs) 66000+2000+5000 = 73,000 7 (Total of Inputs) 44000+7000+6000 = 57,000 8 (EU Sales) 0 9 (EU purchases) 0

64. Now try question 4 Answer next slide

65. Question 4 - Answer Box numberEntry to be made in box 14864.00 2 0.00 3 4864.00 4 2315.00 52549.00 625600 7 11575 8 0 9 0

66. Goods for own use Replacement cost MUST be used Dr Drawings Cr Sales Cr VAT on Sales NOT cash!

67. Purchase of Capital Items VAT Can be claimed with one exception – what is it?!?

68. Sale of Capital Items VAT must be charged on any capital item where input tax has been reclaimed. Example - Sale of a computer where VAT had been reclaimed should have output tax added to the sale price. What about cars?

69. Now try question 5 Check with Kate before moving on to questions 6 & 7