VAT Adjustment Journal

There will be times when you may need to change the VAT liability on a VAT return but again you may not need to enter a transaction such as a invoice, receipt or a bank transaction. This can be done using a VAT adjustment journal.

Creating the Journal

The first step is to enable the journal if you haven’t already done so, click here for more information on that. When ready, go to Journal > +Create. Using the options here;

  • Entry Date – this needs to be dated of the return your running and want to modify. For example, if you were running the return for Q1 2013 you need to date this journal between 01/01/2013 and 31/03/2013 otherwise it will not appear in the return.
  • Category – Select VAT journal
  • Comment – Enter in VAT Adjustment to help you easily identify this in future.

When ready, click Create Journal.

Create the Entry

From the next page enter in your adjustment between the VAT nominal codes. The nominal codes you would normally use on KashFlow are the following:

  • Input VAT – This is the VAT recorded on purchases and outgoings
  • Output VAT – This is the VAT recorded on invoices and money received
  • VAT control – This account keeps track of the VAT account balance

When ready, click Save Changes. If you are unsure what to enter here it is best to consult your accountant as this will affect your VAT return.

To Note:
The VAT Return will only consider Debits and Credits made to the Input, and Output VAT Control Codes and will not include anything you assign to any other code even if in the same Journal.

If you need to update the net amounts for sales and purchases (Boxes 6 to 9) please see this knowledge base article.

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