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useraccount2
October 24, 2023
Question

VAT on profit

  • October 24, 2023
  • 1 reply
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based of the company's business model of e-commerce involving sales and display of company's products for commission. we would need the customisation of our QuickBooks app the capability of only recognising our margin as the revenue (not in line with IAS 18) instead of the entire revenue for the purpose of vat remittances. Whereas we accept payments from customers directly, we actually only take a commission and we pass on the purchase cost to the supplier subsequently. 

1 reply

MariaSoledadG
MariaSoledadG
October 24, 2023

Let me share a few information on how QuickBooks recognises revenue when accepting payments, Useraccounts.

 

For all businesses on an accrual basis, revenue is recognised when it is earned, not when money is exchanged. QuickBooks Online (QBO) is compliant in terms of its accounting practices and ensures it meets the International Financial Reporting Standards (IFRS). Therefore, the customisation of only recognising revenue not in line with IAS 18 isn't possible at this time.

 

However, when it comes to sales like when creating invoices, you can always choose among the option if you want to pay taxes or not. I've added a screenshot for reference:

 

On the other hand, when you purchase, I suggest reaching out to your tax advisor so they can guide you on what options to take or if you'll need to use other VAT codes for the transactions. Read this great resource for additional information: How Do I Set Up Sales GST/VAT Rates And Use Them On Forms?

 

Moreover, you may also want to consider checking out these frequently asked questions with your VAT rates: VAT Feature Update FAQ.

 

Feel free to get back to us if you have any questions about VAT taxes. The Community is always here to help you anytime. 

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