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T
T190
April 20, 2023
Question

QBO Ireland: VAT and not-for-profit entity

  • April 20, 2023
  • 1 reply
  • 0 views

Hi,

we are a not-for-profit in Ireland that must suffer the expense of input VAT on all purchases, and has zero output VAT as we provide an exempt service.

We must be registered for VAT in order to account for reverse charge VAT on EU intra-community purchases, and also on domestic Relevant Contracts Tax-able purchases.

We have recently migrated to QBO and the way we have set up VAT QBO is not recognizing input VAT as an expense (it seems it is assuming we are able to reclaim input VAT), so P&L reports are inaccurate. It also seems very likely that when VAT3 return is due for filing at end April it will also be inaccurate as a result.

Can anybody help with the correct way to set up VAT on QBO in our circumstances?

thanks

1 reply

JessT
JessT
April 20, 2023

Hi T190,

 

Thank you for reaching out to the QuickBooks Community.

I can see that you have a VAT setup that is uncommon in QuickBooks. It's best if you can reach out to our QBO Support team, so they can get your account details in a more secure environment. Then, they'll help you with the step while doing screen-share. In that way, both you and the supporting agent are looking at your QuickBooks and seeing the result in real-time.

 

  1. Click on Help icon.
  2. Choose the Search tab.
  3. Click Contact Us at the bottom.
  4. Enter a sentence or two to describe your concern or you can just say Need Help with VAT.
  5. Click Continue and select Chat with us.

 

On the other hand, you can also check about setting up VAT in QBO for your additional reference.

 

Feel free to go back to this thread if you have other questions in mind. Have a good one!

T
T190Author
April 20, 2023

Having contacted support, it seems that QBO is unable to deal with our circumstances - it's a software limitation. The only workaround we could come up with is to use the "Out of scope of VAT" code when posting vendor bills so that QBO thinks no VAT has been charged

 

This ensures VAT is recognized as an expense on P&L, and is not posted automatically to VAT control a/c.

 

Unfortunately it also means that those VAT items we have to track for reverse charge purposes are also not posted to VAT control a/c, and so we'll have to post journals for each of these.

 

And there will be no record at all of non-reverse charge input VAT in QBO - we sometimes have need of that info for other purposes.

 

So, it's less than ideal solution - if anyone in Ireland has a similar problem and has found a better solution please advise.

tks

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