Hi, we’ve been accounting for our gift voucher sales the way detailed on the knowledge base - Handling gift vouchers
Our accountant tells us that legislation has changed and what we should be doing is paying VAT at the time of the voucher sale rather than the time of voucher redemption. The non VAT component then goes to a deferred sales account and is recognized when the voucher is redeemed.
Is it possible to tag part of a bank transaction to a VAT payable account and part to a Deferred Sales Account?
I wouldn’t try and split it at the bank transaction level, but create a sales invoice with two lines assigned to different categories and tag the bank transaction as payment for that invoice.
You’d create a new code somewhere under the assets & liabilities range and tick the option to allow the code to be used on sales invoices, then create an invoice with two lines, one on your new code for the voucher value at the appropriate VAT rate and the other for the rest of the sale value to General Sales. This should account for the VAT there and then and put the non-VAT component of the voucher value into your new nominal.
When the voucher is redeemed you’d journal the value across to General Sales at that point (or maybe create another new code in the sales range to separate voucher redemptions from normal sales).
Why would it need a two line invoice? If full amount is for the voucher i.e. 100 + 20 (VAT) = 120 voucher
I thought this might be straight forward but once a new code is set up and the box is ticked to allow it be used in invoices, how do I assign invoices to it? Invoices are still going to General Sales, and when looking at this nominal account, it is not possible to transfer over to the new nominal code that is a liability.
Invoices go to general sales by default but you can change the nominal code for an individual line by clicking the little cog wheel icon in the line description box.
And yes, a single line invoice would be fine if you’re only selling a gift voucher in that transaction, I was thinking from my shop point of view where I might be selling a few pounds worth of vouchers in amongst a few hundred other (general) sales and entering them all on one invoice - you need different lines for different nominals.
