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Vat & mtd

resolved
#1

If an invoice has already been submitted in the previous tax year, and the invoice has not been paid, but the client has promised to pay in a few months, how do i keep this from going into the VAT return seeing that it has already been submitted? or do i recliam it as a bad debt, then resubmit it?

Many thanks

#2

If you’re on cash accounting this should happen automatically as the vat is only due once you’ve received payment, if you’re on accrual accounting then the vat is due now even if you haven’t yet been paid.

#3

Thanks for your reply Ian, i do know the difference, but thats not what im asking. In this situation the previous bookkeeper was doing both kinds and has completely mucked it up coursing a cash flow issue, also clients have been failing to pay etc, i want to set it to cash accounting, but we have 5 clients who are not paying.

At this moment in time im unsure whether they will pay and as i want to straighten the accounts out i wondered if claim it back as a bad debt would be A, better for cashflow and B, sort out this issue and prevent it from re-entering the VAT quarter if they do pay.
That way if ive made a reclaim, if they pay in another 6 months etc i can resubmit with cash accounting etc

But if there was a way of preventing it from being submitted again, then that may be the option to go with. hope this makes better sense?

#4

Hi @Hayles,

I would say you need to seek advice from an accountant on this to make sure that you are processing everything correctly for your VAT return.

#5

I did actually do this, so its been approved by the accountant.

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closed #6

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