We are a holiday letting business using QB Desktop Version and are on the Flat Rate Scheme. There appears to be a problem reporting VAT where temporary VAT rate is 5% and Flat rate is 0%. Credit notes appear to be ignored.I spoke to support and they told me to:Raise Credit notes for all the sales invoices (invoiced at 20%) that would be eligible for the new 5% VAT Rate from 15th July to 12 Jan 2021Added new “C19” VAT rate at 5%Changed VAT Flat rate from 9.5% to 0%Copied old invoices and changed VAT rate to “C19”When I run a VAT report for last VAT period it show £0 dueWhen I run a VAT report for current VAT period it show £0 due (think this should probably be a refund)To add to the complication we also raise a few invoices that are not eligible for the reduced 5% and remain at 20%I spent nearly 2 hours with Support yesterday and it is apparent that they do not understand the new VAT Regime. I had previously been asked to send a link to the new legislation which I provided. We are registered for MTD so cannot do a manual online return calculated using a spreadsheet.

Question

Temporary 5% VAT Rate for Hospitality Business's

Forum|Forum|5 years ago
August 19, 2020
2 replies
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We are a holiday letting business using QB Desktop Version and are on the Flat Rate Scheme. There appears to be a problem reporting VAT where temporary VAT rate is 5% and Flat rate is 0%. Credit notes appear to be ignored.

I spoke to support and they told me to:

Raise Credit notes for all the sales invoices (invoiced at 20%) that would be eligible for the new 5% VAT Rate from 15th July to 12 Jan 2021
Added new “C19” VAT rate at 5%
Changed VAT Flat rate from 9.5% to 0%
Copied old invoices and changed VAT rate to “C19”
When I run a VAT report for last VAT period it show £0 due
When I run a VAT report for current VAT period it show £0 due (think this should probably be a refund)
To add to the complication we also raise a few invoices that are not eligible for the reduced 5% and remain at 20%

I spent nearly 2 hours with Support yesterday and it is apparent that they do not understand the new VAT Regime. I had previously been asked to send a link to the new legislation which I provided.

We are registered for MTD so cannot do a manual online return calculated using a spreadsheet.

QuickBooks Desktop

A

Ashleigh1

Hello Gly PE,

Welcome to the Community page,

It sounds like when you have created the new VAT Code, you haven't assigned the VAT items to the VAT code.

These VAT items will show where the VAT is hitting the VAT return.

So it sounds like you just haven't put in where they want the VAT to essentially to go.

If you can please check this

list>VAT code list>edit C19 code>check taxable information for VAT item purchase/sales

G

Glyn PEAuthor

Thanks Ashleigh, have already made changes here with QB support but they could not get it to work correctly.

G

Glyn PEAuthor

UPDATE

First of all I want to say how totally disappointed I am with QB Desktop Support in Indonesia. I have wasted hours on the phone trying to get advice on this VAT Issue and have been promised I would be called back by the VAT specialist team leader on 2 occasions. I have waited in the office for 2 days for these callbacks. This is totally unacceptable support considering the now very high monthly cost.

SOLUTION

I have found a solution to reporting VAT under the temporary 5% Holiday Let concession. If anyone would like to know the process please reply to this post and I will write it up.