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How invoices affect VAT

Forum|Forum|4 years ago
July 12, 2021
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Hi all, I'm reaching out for some help with how the VAT figure is calculated in QB. I have a number of unpaid invoices which I have written off as bad debt, but the sales figure on the taxes page stays the same. If I add an invoice the figure increases no problem! How do I sort this? I have two invoices to sort for the current VAT quarter but there are also quite a few invoices from last year which I think we have paid VAT on when we shouldn't have.

Thanks in advance.

QuickBooks Online

Best answer by GeorgiaC

Further to this, I contacted the support team as suggested. I was on the phone for 1 hr 42 mins and for a lot of that time I was put on hold whilst the QB employee tried to work this out. The problem hasn't been resolved. Can anyone help??

Hi lisa180, if your VAT has been set to cash for the duration of your filings on QuickBooks, then creating the credit note with the same VAT code as the invoice and applying this will result in no net impact to the VAT return, as the VAT is only accounted for when the transaction is closed/paid.

Please get back to me below if you have any further questions 🙂

E

EmmaM

Hello Lisa180, What transaction did you do to write off the bad debt in QuickBooks? This will help us see why the VAT has not been affected. There are options we can go through to adjust the return once we know that. Thanks.