Correct category for import VAT

[clivem]

which would be the correct category for this import vat so it shows correct in profit and loss / balance sheet etc. please - currently as import duty but its not that, its import VAT

[QFSteve]

Hello @clivem

There is a wide range of process involved in processing vat on imports depending on the situation, you may wish to consult your accountant to get professional tailored advice as the support team are not registered accountants.

I did also find some threads in the forum which may help, you can also try searching the forum

Entering Import VAT

Hi I need to enter some invoices relating to import charges. The highest value is import VAT but I do not seem able to amend the VAT to any amount over the expected 20%. For example Invoice total 59,945.77 Import VAT 57,325.38 The remainder is made up of various shipping process charges. VAT registered so able to claim back and entry is on the C79 certificate. How should this be entered on Quickfile?

FedEx VAT on Imports

Hello, Previously, I entered purchases somewhat lazily without specifying the VAT (i.e., I simply entered the full amount). Now that we are registered for VAT, I’ve had to revisit these purchases and enter the pre-VAT amount. I adjusted the drop-down to 20%, which automatically calculates the final amount (the same as the full VAT amount previously entered). However, I’m encountering a challenge with an invoice from FedEx for duties and taxes incurred when importing supplies. For example, the …

[clivem]

thanks i have searched the forum already - not looking for professional advice - i am wanting to know which category on quickfile this should be placed under as Quickfile offers no VAT Category that i could find…

[ian_roberts]

If it allows you to enter like that then it doesn’t make any difference what category you choose as only the net amount goes onto the purchase category and in this case the net is zero. The VAT element will go on the control accounts to be reclaimed on your next return the same as vat on any other purchase.

[clivem]

ah! forgive my ignorance Ian but just to clarify what you are saying.

this is a ‘cost’ under import duty now but as soon as its claimed on Vat return then it results in a net Zero balance so wont add to any category on P&L etc - and hence doesnt matter quite where / which category is used now?

Many thanks for your reply

[ian_roberts]

Yes. When you create a purchase it’s only the net value (excluding VAT) that gets assigned to the category you selected for the purchase row. The VAT value goes on your balance sheet under the “purchase tax control account”, and is then netted off from there when you complete a VAT return.

In this case you’ve set a net value of zero, so there’s nothing to go on the “import duty” nominal.

[clivem]

brilliant - thanks for that ian