On the 1st July I need to change from the VAT Fixed Rate scheme to the Standard VAT Rate scheme.
If I amend my settings very early on the 1st July will all new transactions received into QuickFile be handled correctly at the 20% rate, plus when completing the June VAT filing, later in July, will that still be using the previous Fixed Rate VAT calculations?
Or should I wait until I’ve completed June’s VAT filing before changing the settings and will all of the transactions received from the 1st July be correctly processed at the 20% rate when I get to doing the September VAT filing?
If you’re not changing from cash to accrual accounting (or vice versa) at the same time then you should be able to switch your settings from flat rate to standard on 1st July so you can start recording VAT on purchases. Then when you come to do the last flat-rate return you’d have to temporarily switch your settings back to flat rate, submit the return, then revert to standard.
Being on flat rate doesn’t affect how you record your sales, you still issue your invoices as net + 20% VAT, the flat rate only comes into it at the point where you submit the return. However QuickFile doesn’t generally let you split out VAT on purchases when you’re set up for flat rate since you don’t usually claim back purchase VAT (apart from large capital expenses).
Are you able to advise on @ian_roberts comments regarding purchases and his suggestion that we switch to standard rate on the 1st July and temporarily switch back to flat rate just as we are about to do the June filing? Thanks.
Yes the way that @ian_roberts suggests would work.
If you were to wait until you’ve submitted the return to change the settings there is also an option to include the VAT on purchases, you would just need to remember to tick the box for those after 1st July:
