Incorrect flat rate VAT calculation

I got the following VAT calculations using the VAT Flat Rate scheme.

I think boxes 4 and 7 should not have any values displayed. Any help with this would be appreciated.

Hello @csaba

There are certain things you can claim VAT back on with purchases, so the figure would depend on the invoices that are generating these figures.

If you download the calculations, do you have purchase invoices with VAT assigned to them?

Thank you for the quick reply. I know you may reclaim VAT on certain capital items when using the Flat Rate Scheme but I did not tick the option on any of the purchases entered, yet all purchase invoices with any VAT are listed on the return. We used the Flat Rate Scheme option in the past and it always worked great so far.

If the option isn’t ticked, you wouldn’t have the option to input the VAT for the purchase - it would be treated as if there was no VAT on it.

If an invoice is showing on the calculations download, I would recommend going back and checking those purchase invoices to ensure the option isn’t ticked. Just bear in mind that if you untick it, the VAT will be removed so the net value may be need to be adjusted to account for this - e.g. a £100.00 invoice with £20.00 VAT is £120.00 gross, but with VAT removed, it would save as £100.00 in total.

Got it. All these items were entered before the flat rate option was ticked. As they were originally entered with a VAT element, they now show up on the return (even though they should not be reported to HMRC).

That would do it.

You can either go back and amend the invoices, or manual adjust the VAT return (which may be quicker if there are quite a few purchase invoices).

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