Hi,
we have received a refund from HMRC after submitting a claim for Error Correction. This error applies to 2014/15 and was picked up during YE accounting. The refund has been paid into our bank account and needs tagging. How should I enter this refund as we are now on Flat Rate at 14% and this should not be entered in a way that will affect the current vat return?
Thanks
Nick
Was the original VAT return processed on QuickFile? If so you should be able to tag this as a tax refund from the bank:
Then select the option “VAT” refund.
Tagging this refund will not affect your next VAT return calculations in any way.
Glenn,
thanks. The original return was pre quickfile but I don’t think that is a big problem. I have tagged as a vat refund but this creates an imbalance in VAT Liability 2202. I’ll sort out a journal to balance this with the accountant.
Cheers