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H
Hazelnutsky
October 23, 2023
Question

Interim VAT

  • October 23, 2023
  • 1 reply
  • 0 views

Hello, I just started using Quickbooks today, so forgive me if I am asking a common question. 

I have also just registered for VAT, which is the reason I am using quickbooks.  Now in the 'interim' between applying for and getting a VAT number I am supposed to pay VAT on income, but I could not charge VAT without a number, which I only recently just got. My customer has agreed to pay a VAT-only invoice to cover the two invoices I was not able to charge VAT for. So how do I handle this in Quickbooks? Do I make up invoices with VAT on them, but only apply a partial payment? Then how do I account for the VAT payment when it arrives. I'm confused what to do here.

Thanks in advance. Hazel

1 reply

G
GeorgiaC
October 23, 2023

Hello Hazel, thanks for joining the Community

 

You can enter a VAT-only invoice for your customer by following the steps below:

 

1. Go to + New icon.
2. Choose Invoice.
3. On the first item line, select the default Sales account, enter 0.01 in the amount field, and select the 20% S VAT code
4. On the second item line below this, select the same Sales account and enter -0.01 in the amount field, and choose the Exempt code.

5. The subtotal should be zero. Edit the amount in the VAT field ('Includes VAT @ 20% on')
5. Click Save and send.

 

This will create a 100% VAT transaction that will show in Box 1 on the VAT return. 

 

You can then select receive payment on the invoice once the customer has paid this to you.

 

For further support on entering VAT-only transactions in QuickBooks Online, see here. 

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