So it turns out that there are 8 transactions after 28/02 (trial balance date) that are purchases which included VAT, totalling £47.66 to reclaim.
These are standard UK transactions, not reverse charged, and not accounted for in the trial balance export as of 28/02.
That’s correct. That Barclays account is now closed, and QF is linked to the new (Starling) account, so any transactions from now will get pulled through.
If you mean the old current account: I included that in the trial balance export from Xero as of 28/02 which I imported into QF’s trial balance importer.
I’ve asked our current accountants whether I can just make adjustments for these transactions. If they reply affirmatively, I assume I would do this via journals?
Yes, so you do have a “bank account” in QuickFile that represents the Barclays account before it was closed, and you should be able to enter and tag these purchases in QuickFile as normal and they’ll be accounted for in your first QuickFile VAT return in the normal way.
The adjustments you would have to make on that return would be if any of the purchases you’re paying in March were actually invoiced by the supplier in February - you’ve said you’re switching to VAT cash accounting so QuickFile will reclaim VAT on your purchases based on the date when you paid for them, but under accrual accounting Xero will already have reclaimed the VAT on anything where the supplier invoice was dated February even if it was not yet paid. So on your first QuickFile return you need to deduct from box 4 & 7 anything where the payment was in March but the invoice was in Feb, otherwise you end up reclaiming the same VAT twice.
Likewise anything where you invoiced a customer in February but they didn’t pay you until March, Xero will have paid the VAT based on the invoice date and QuickFile will try to pay it again based on the payment date, so you’ll have to deduct any such items from box 1 and 6.
When the Barclays account closed the final transfer of the balance is presumably then a bank transfer to the Starling account.
Thankfully, the invoices/receipts and the bank debits are all within a day or two of each other (via automated card debit, etc.), so this is simple.
None of them are income, so no complications there.
Indeed - and this makes me realise that I have made an error:
When importing the trial balances, I assigned the balance of the old Barclays account on 28/02 to nominal 1200 (Current account). I now realise that this gives me an incorrect balance in that nominal account, because it represents the Starling account that now has the active feed set up (that amount plus the actual balance as of today shows as the balance, even though the actual balance is lower now).
I’m assuming that I should have created a new nominal for the old Barclays account, and mapped the trial balance to that …
Can I solve this by setting up that old account nominal and using a journal entry to correct, would you say? Or by editing the original journal entry created when I entered the trial balances, by creating a new nominal account there and re-saving it? I don’t want to make this worse …
The latter is probably the simplest - create a new bank account representing “Barclays account” which will get nominal code 1201 or 1202 or similar, then edit the original TB journal to change the 1200 to this new code.
Fine in this case, but you’ll still have to bear this in mind if there are any outstanding invoices that you issued through Xero that have not yet been paid. If any of these exist then the simplest trick would actually be that when you receive the payments for these, tag them direct to the debtors control account via “something not on the list”, instead of treating them as “payment from a customer”. These direct-to-nominal tags don’t affect the QuickFile VAT return at all, QF only takes VAT figures from sales and purchase invoices and their associated payments from customer/to supplier.
Our current accountant got back to us, suggesting that we change our VAT reporting quarter to start in April, and file a single month return in Xero. That way, the dates of our FY and VAT quarter tie up, and QF can handle everything from 01/04/2022 - which simplifies this whole thing.
Given that they can produce our accounts pretty quickly after 01/04/2022, I’ve deleted the journal entry which was produced from the existing trial balance imports, and I’ll go through that process again (armed with a bit more knowledge!) once our accounts are finalised and they can then produce new opening balances as of 01/04/2022 - which should make everything quite a bit easier.
It seems our current accountants are happy to assist us in getting this data into QuickFile as we part company with them, which is great.
Thanks so much for your help here - I’m very much learning as I go. I had hoped to have another week of teaching myself the basics before having to deal with any of this …
