VAT returns

[joannacumm]

Is there any way to use the system for VAT reporting? If anyone has any tips on how this could be done I'm very grateful as looking into whether this is possible via this system.

[emm]

Hi,

It isn't possible to record VAT, other than what is charged by letting agents if you use them to manage your properties. I don't know of any work-arounds in this instance, I'm afraid.

Sorry!

[merstonman]

There is a way of "recording" VAT but its not ideal.

I have one property elected to tax and therefore have to charge VAT on the rent.

What I did so not to record the VAT as rent and pay tax on it I set the tenants rental payment and invoice at the rent excluding VAT.

I then set up a nominal ledger called VAT

Then raised a manual invoice to the same tenant for VAT posted to the tenant ledger and VAT account. So for this invoice the double entry is debit tenant ledger credit VAT.

The VAT ledger shows the VAT "collected".

In the end was too much hassle so I opened a separate bank account for this tenant to pay the rent into. My ledger in landlord vision still shows the net rent which I transfer over to the main bank account and treat as the rent paid. Im using different software on the separate bank account to deal with "making tax digital" so I record an invoice there send that to my tenant which shows the rent plus VAT and use that software for VAT reporting. I leave the VAT payable in the bank account and pay the VAT man from there.

You may struggle with the above method unless you have a good understanding of double entry. Also it would depend on the number of VAT invoices you are raising. As I dont reclaim any VAT on expenses on this property I didnt have to find a way of recording any expenses with VAT but I think it would be possible.

Regards

Fiona

[roy]

Hello Fiona

Thank you for your post

For completeness, the other workaround is as follows:

Set up a nominal ledger account called VAT (you only need to do this once)
Set up the tenancy to show the full amount payable by the tenant, ie rent + VAT
This will allow you to reconcile the bank account with the amount paid
Next, record the following journal in Account Manager > Journals

Account | Debit | Credit
Rental Income | 0.00 | VAT amount
VAT account | VAT amount | 0.00

Now your reports will show the correct totals

Kind regards
Roy