VAT Transfers

These instructions are relevant to UK VAT only.

After completing the VAT Return, the reconciled values from the Sales Tax Control Account and Purchase Tax Control Account should be transferred to the VAT Liability nominal code to show the value due to be paid to, or reclaimed from your tax authority.

On paying or receiving the VAT, a bank payment or receipt can then be posted to clear the VAT Liability nominal code.

You are able to create a manual journal entry or you may use the VAT Transfer screen to perform the transaction for you.

VAT Transfer Screen

The steps below will assist you in posting your ledger entries to transfer your VAT control account balances to your VAT liability account.

1. Complete your VAT return as usual.
2. Reconcile your VAT return
3. Ensure you have submitted your VAT return to your tax authority
4. For Sales, note the value from box 1 on your VAT return
5. For Purchases, note the value from box 4 less the amount from box 2 on your VAT return
6. Navigate to the Transaction tab.
7. Select the VAT Transfer icon.
8. Enter the Date of the transfer which will be the posting date
   • We recommend using the last date of the VAT period this transfer relates to so that all ledger transactions relate to the same period as your VAT period.
9. Enter the amount from the VAT return box 1 in the Sales field.
10. Enter the amount from VAT return (box 4 – box 2) in the Purchases field
11. Click Save.

The automated ledger entries are created for you.  You should go and review those using your ledger report to ensure you are satisfied with the outcome.   If you need to make any changes, you would need to reverse the ledger entries with a manual journal entry.

Manual Journal Entries for VAT Transfer.

The steps below will assist you in posting your manual journal to to transfer your VAT control account balances to your VAT liability account.

You have greater control over your journal as you will be able to unpost your journal should you make any errors or need to adjust.

1. Complete your VAT return as usual.
2. Reconcile your VAT return
3. Ensure you have submitted your VAT return to your tax authority
4. For Sales Tax Control Account, note the value from box 1 on your VAT return
5. For Purchase Tax Control Account, note the value from box 4 less the amount from box 2 on your VAT return
6. Navigate to the Transaction tab or go directly to the Journal tab.
7. Select the Journal icon or the New button on the Journal tab.
8. Enter the Date of the journal which will be the posting date
   • We recommend using the last date of the VAT period this transfer relates to so that all ledger transactions relate to the same period as your VAT period.
9. Enter a Reference to help you recognise the ledger entries.
10. Using your own nominal codes, please enter and Post the below journal

In this example, the value of box 1 is 10,000 and the net value of box 4 less box 2 is 5,000

Your journal and ledger entries will be created for you. You should go and review those using your ledger report to ensure you are satisfied with the outcome.   If you need to make any changes, you would need to reverse the ledger entries with a manual journal entry.