Out of scope invoice appearing on MTD VAT return

I’m trying to submit my first MTD VAT Return. I have the date range set from 01/05/19 - 31/07/19.

The accounting method is set cash accounting.
VAT Period F,M,A,N
Start Date 1/5/19
When I look at the calculations it includes an invoice raised in 30/4/19 (paid on 27/05/19) that I have already included in the previous period submission and it’s excluded another invoice that I’ve just raised but hasn’t been paid. I accept this may technically not be the correct way to do it but I’ve always calculated my VAT on invoices raised rather than invoices paid.
So do I just make manual adjustments to exclude the invoice I’ve already paid and moving forward just include paid invoices??

Hi @shandyboy,

If you are Cash accounting then the VAT return is based on the actual cash that has changed hands rather than the invoices raised. So the invoice that you said has been included (Paid 27.05.19) this is because cash accounting looks at the paid date and not the invoice date of 30.04.19 which is why it has been included.

The same goes for those that haven’t been included. If they haven’t been paid then there is no Cash to account for, they will be included once the payment has been allocated to them.

hope this helps

1 Like

Thanks for the prompt response - I accept that the problem is my own making but to resolve it should I not have it set to Cash accounting or do I just this adjust this return to exclude the paid invoice and then moving forward it will then be right?

I can’t comment on whether or not you should have set it to Cash accounting as that depends on what you have signed up for.

You can do a manual adjustment on your return for the invoice that has already been included :slight_smile:

You should have it set to whatever scheme you are on. This will be on your VAT registration certificate or you can find out by logging into your HMRC account or giving them a call.

Thanks for your help

1 Like

This topic was automatically closed after 3 days. New replies are no longer allowed.