How is the VAT return calculated for “Cash VAT method”?

Zumzum Financials Knowledge Base

    How is the VAT return calculated for “Cash VAT method”?

    Many businesses using Zumzum Financials are VAT registered which means that each month or quarter they must produce and reconcile their VAT Return. This help article will assist you with the processes involved in reconciling your VAT Return.

    How the VAT Return calculates

    When using the VAT Cash Accounting scheme, the Zumzum Financial VAT Return calculates input and output tax from the VAT element of your bank customer receipts, bank receipts, customer payments on account, bank payments, bank supplier payments and supplier payments on account. When you post a bank customer receipt or bank supplier payment, Zumzum Financials refers to the original invoice to determine which tax code to use.

    The VAT Return also includes:

    • The VAT element of your bank, cash and credit card bank receipts.
    • The VAT element of your bank, cash and credit bank payments.
    • The value of any journal entries posted with an appropriate tax code.
    • The VAT element of any sales or purchases using the Reverse Charges tax code.

    The below table highlights the transactions that are included in each box of your VAT return.

     

    Box Transaction Type Tax Type
    Box 1 Sales receipt (SR) Standard Rate & Lower Rate.
    Box 1 Sales on Account (SA) Standard Rate & Lower Rate.
    Box 1 Purchase Invoice (PI) Reverse Charges
    Box 1 Purchase Credit (PC) Reverse Charges
    Box 1 Bank Receipt (BR) Standard Rate & Lower Rate plus
    Reverse Charges.
    Box 1 Bank Payment (BP) Reverse Charges
    Box 1 Journal Credit (JC) Standard Rate & Lower Rate plus Reverse Charges.
    Box 1 Journal Debit (JD) Reverse Charges
    Box 1 Sales Payment (SP) Standard Rate & Lower Rate
    Box 2 Purchase Invoice (PI) EC Acquisitions Goods Standard Rate & EC Acquisitions Services Standard Rate
    Box 2 Bank Payment (BP) EC Acquisitions Goods Standard Rate & EC Acquisitions Services Standard Rate
    Box 2 Journal Debit (JD) EC Acquisitions Goods Standard Rate & EC Acquisitions Services Standard Rate
    Box 2 Purchase Credit (PC) EC Acquisitions Goods Standard Rate & EC Acquisitions Services Standard Rate
    Box 2 Bank Receipt (BR) EC Acquisitions Goods Standard Rate & EC Acquisitions Services Standard Rate
    Box 2 Journal Credit (JC) EC Acquisitions Goods Standard Rate & EC Acquisitions Services Standard Rate
    Box 3 Auto-Calculation Box 1 + Box 2
    Box 4 Purchase Payment (PP) Standard Rate & Lower Rate
    Box 4 Purchase Payment on Account (PA) Standard Rate & Lower Rate
    Box 4 Purchase Receipt (PR) Standard Rate & Lower Rate
    Box 4 Purchase Invoice (PI) EC Acquisitions Goods Standard Rate & EC Acquisitions Services Standard Rate plus Reverse Charges.
    Box 4 Purchase Credit (PC) EC Acquisitions Goods Standard Rate & EC Acquisitions Services Standard Rate plus Reverse Charges
    Box 4 Bank Payment (BP) Standard Rate & Lower Rate plus EC Acquisitions Goods Standard Rate & EC Acquisitions Services Standard Rate as well as Reverse Charges.
    Box 4 Bank Receipt (BR) EC Acquisitions Goods Standard Rate & EC Acquisitions Services Standard Rate plus Reverse Charges.
    Box 4 Journal Debit (JD) Standard Rate & Lower Rate plus
    EC Acquisitions Goods Standard Rate & EC Acquisitions Services Standard Rate as well as Reverse Charges
    Box 4 Journal Credit (JC) EC Acquisitions Goods Standard Rate & EC Acquisitions Services Standard Rate plus Reverse Charges.
    Box 5 Auto-Calculation Box 3 + Box 4
    Box 6 Sales Receipt (SR) Standard Rate, Lower Rate, Zero Rated & Exempt Transactions
    Box 6 Sales Invoice (SI) EC Sales Goods & EC Sale Services
    Box 6 Purchase Invoice (PI) Reverse Charges
    Box 6 Sales Receipt on Account (SA) Standard Rate, Lower Rate, Zero Rated & Exempt Transactions
    Box 6 Sales Payment (SP) Standard Rate, Lower Rate, Zero Rated & Exempt Transactions
    Box 6 Bank Receipt (BR) Standard Rate, Lower Rate, Zero Rated & Exempt Transactions plus EC Sales Goods & EC Sale Services. As well as Reverse Charges.
    Box 6 Bank Payment (BP) EC Sales Goods & EC Sale Services plus Reverse Charges
    Box 6 Journal Credit (JC) Standard Rate, Lower Rate, Zero Rated & Exempt Transactions plus EC Sales Goods & EC Sale Services. As well as Reverse Charges.
    Box 6 Journal Debit (JD) EC Sales Goods & EC Sale Services plus Reverse Charges
    Box 7 Purchase Payment (PP) Standard Rate, Lower Rate, Zero Rated & Exempt Transactions
    Box 7 Purchase Payment on Account (PA) Standard Rate, Lower Rate, Zero Rated & Exempt Transactions
    Box 7 Purchase Receipt (PR) Standard Rate, Lower Rate, Zero Rated & Exempt Transactions
    Box 7 Bank Payment (BP) Standard Rate, Lower Rate, Zero Rated & Exempt Transactions plus EC Acquisitions Goods Standard Rate & EC Acquisitions Goods Zero Rated. As well as
    EC Acquisitions Services Standard Rate & EC Acquisitions Services Zero Rated plus Reverse Charges
    Box 7 Bank Receipt (BR) EC Acquisitions Goods Standard Rate & EC Acquisitions Goods Zero Rated. As well as
    EC Acquisitions Services Standard Rate & EC Acquisitions Services Zero Rated plus Reverse Charges
    Box 7 Purchase Invoice (PI) EC Acquisitions Goods Standard Rate & EC Acquisitions Goods Zero Rated. As well as
    EC Acquisitions Services Standard Rate & EC Acquisitions Services Zero Rated plus Reverse Charges
    Box 7 Purchase Credit (PC) EC Acquisitions Goods Standard Rate & EC Acquisitions Goods Zero Rated. As well as
    EC Acquisitions Services Standard Rate & EC Acquisitions Services Zero Rated plus Reverse Charges
    Box 7 Journal Debit (JD) Standard Rate, Lower Rate, Zero Rated & Exempt Transactions plus EC Acquisitions Goods Standard Rate & EC Acquisitions Goods Zero Rated. As well as
    EC Acquisitions Services Standard Rate & EC Acquisitions Services Zero Rated plus Reverse Charges
    Box 7 Journal Credit (JC) EC Acquisitions Goods Standard Rate & EC Acquisitions Goods Zero Rated. As well as
    EC Acquisitions Services Standard Rate & EC Acquisitions Services Zero Rated plus Reverse Charges
    Box 8 Sales Invoice (SI) EC Sales Goods
    Box 8 Bank Receipt (BR) EC Sales Goods
    Box 8 Journal Credit (JC) EC Sales Goods
    Box 8 Sales Credit (SC) EC Sales Goods
    Box 8 Bank Payment (BP) EC Sales Goods
    Box 8 Journal Debit (JD) EC Sales Goods
    Box 9 Purchase Invoice (PI) EC Acquisitions Goods Standard Rate & EC Acquisitions Goods Zero Rated
    Box 9 Bank Payment (BP) EC Acquisitions Goods Standard Rate & EC Acquisitions Goods Zero Rated
    Box 9 Journal Debit (JD) EC Acquisitions Goods Standard Rate & EC Acquisitions Goods Zero Rated
    Box 9 Purchase Credit (PC) EC Acquisitions Goods Standard Rate & EC Acquisitions Goods Zero Rated
    Box 9 Bank Receipt (BR) EC Acquisitions Goods Standard Rate & EC Acquisitions Goods Zero Rated
    Box 9 Journal Credit (JC) EC Acquisitions Goods Standard Rate & EC Acquisitions Goods Zero Rated

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