I am having a problem filing my VAT return using MTD; I recognise that this is something to do with dates not reconciling between invoice and VAT return period but I cannot resolve. I seem to have this problem every time I go to submit a VAT return to HRMC. VAT is due on September 7 Help!
Hi @denney
We’ll certainly try our best to help. Can you give us a few more details in regards to what the issue, exactly, please?
If needed, we can take this private to discuss specific examples - just let us know if this is needed and we can do this before you share anything.
Thanks, Matthew; I sorted this out by changing the date that payment was made in the Banking section.
I just have to remember to do this every quarter!
Regards,
David
It should automatically put things in the right quarter depending whether your QuickFile VAT settings say cash or accrual accounting.
- cash accounting chooses the quarter based on the date of payment
- accrual accounting chooses the quarter based on the date of the invoice
New accounts default to cash accounting so if you want to do your vat on accrual basis you just need to change the setting (though if you’ve already submitted a cash accounting return then the changeover next quarter may be a bit fiddly).
Conversely if you want to use cash accounting then it’s normal for your quarterly sales total not to exactly match your vat return, since invoices raised near the end of one quarter but paid in the next are not supposed to be reported to HMRC until after they have been paid. This applies to both sales and purchases - the quid pro quo of cash accounting is that while you don’t have to pay your sales VAT to HMRC until after your customers have paid you, you also can’t reclaim VAT on your purchases until after you have paid your suppliers, even if that’s months after the date of their invoice.
Ian,
Many thanks for your note.
I am using cash accounting and in order to file my VAT return via MTD I have to change the payment date from the date payment was actually made.
For example, I sent my invoice to my Company on 30 June 2023 for Q2 (April/May/June). This Q2 invoice included the VAT which I have to pay HRMC on September 7.
I received my Q2 payment on 4 August 2023 but when I used this date I could not populate my HRMC VAT return.
It was only when I went to Bank Entry and changed the payment received date to 28 July 2023 that I could file my VAT return with HRMC.
I suspect that I will need to change the payment date every time my Company pays me sometime after 30 days from invoicing.
Is this correct?
Regards,
David
If you’re on cash accounting then the VAT on your invoice needs to be paid over to HMRC in the VAT return for the quarter that includes the date you were paid (4th August), not the date on your invoice.
Ian,
If you are right, I don’t understand why my Quickfile dashboard information on Pinboard tells me I need to file a VAT return and make payment by 7 September?
What are your VAT quarters? If you use quarters Feb-Apr, May-Jul, Aug-Oct and Nov-Jan then yes, you do have to submit a VAT return by 7th September, covering all sales and purchases for which payment happened between 1st May and 31st July. But if your 30th June invoice was paid on 4th August then the VAT on that one will be part of the return that is due on 7th December (for August to October), not the one that is due on 7th September.