VAT Not Calculating Correctly Cash Accounting Period Key: 20A1

My VAT return is doing something strange.
I have to submit my return today. It has pushed quite a few paid invoices through to the next quarter. HELP!

I’m on cash accounting not had any issues before.
My return has not been submitted yet.

The next return is way over expected amounts

If the next return is way over expected amounts then surely the last return was way under.

So how is this an issue for you?

Unless of course your implying the same invoices were included in 2 different vat returns, but you don’t make that clear

Cash accounting records when a payment is received. If you either receive payment or don’t tag the bank transaction until after a submitted vat return. Then it will be added to the following one.

Check the vat settings to double check you have selected cash accounting.

Hi Paul,

My issue is all accounting has been made invoices paid and tagged correctly.
Quickfile has split them over 2 returns. I don’t know what I have done it’s never happened before. The return is due to be filed.

Basically Feb Mar Apr is showing light
May which is not due is showing wrong, Part of income for due quarter is some how processing in the next quarter not due. I haven’t sent anything off to HMRC as yet. I am on making tax digital system if that helps.

I go to create new return, so I can file. I’m showing 2 open returns
20A1 1 Feb 2020 30 Apr 2020. (missing paid invoices)
20A2 1 May 2020 31 Jul 2020. (missing invoices moved forward)

I hope this helps. I have no button to roll anything back.
If I untag a payment and re make it it is removed from May return not due. So I thought I had fixed it only to discover when I re do the payment it pops back in to the wrong qtr. The dates are correct it’s like it has locked the qtr too early and posted 40% to the next qtr.

I think its because you are not understanding something.

You will have two open returns under MTD, if the first one hasn’t been submitted yet, then the figures will show in the following return also.

Once the first return has been submitted, the second open return should remove the invoices that were included in the first submitted one.

What date were they paid on?

As Paul said above, on cash accounting what matters is the date of payment, not the date of the invoice. An invoice dated 28th April that was paid on 2nd May belongs in the May-July return, not the Feb-Apr one.

All Pre April invoices paid before 30th April
e.g.

14222 10/02/2020 Client £5,892.00 Net £1,178.40 VAT Paid 31/03/2020.

All tagged via bank download.

This transaction is showing on May/Jun/Jul Qtr (Not Feb/Mar/Apr)

:thinking:

Hi @cps

Can I just confirm a few things please?

Have you filed the Feb-Apr return successfully, and the invoices in question do appear in the calculations export of that return?

And then, the same invoices appear in the next return?

Hi QFMathew,

No return has been submitted
When I go to create return
Feb/Mar/Apr is open and in prepare mode.
May/Jun/Jul is open and in prepare mode.

Yes invoice 14222 is listed in both returns.

I have not submitted the return (now late) because I know something is not right. I don’t want to submit an incorrect return.

I have untagged all income for May so in theory there should be no VAT for May/Jun/Jul.

The way QuickFile works you can’t get an accurate view on a future quarter’s return until after you have submitted all the previous quarters. By design, when you submit a return for one particular quarter, any payments that are dated in a previous quarter but not already locked to a previous return will also be included in this one. Again, this is by design, to ensure that if you submit a return and then later find things that were missed out from it, you can enter those with their correct dates and be confident that everything will be corrected for in the next available return.

If every payment that should be showing in Feb-Apr is showing in Feb-Apr (again, it’s only the payment date that counts as you’re on cash accounting, the invoice date is irrelevant) then you’re good to go - once you submit Feb-Apr those things will stop showing under May-Jul because they will have been locked by the Feb-Apr submission.

If you want to do a dry run to be 100% sure, you can temporarily disable the online filing option in your QuickFile VAT settings which will let you “save” the Feb-Apr return without submitting it to HMRC, then you can prepare the May-Jul one and see that the earlier payments are no longer included. Once you’re happy, roll back the saved return, re-enable online filing, and do the Feb-Apr return again in the normal way.

P.S. your Feb-Apr return is not “now late” - you have until 7th June to submit a return for the period up to the end of April.

Thank you everyone I will do as suggested and do dry run to be sure.