How do I empty my Vat accounts for year end?

article ID: 2023151 

 

The only VAT N/C that should contain enteries when you carry out Year End is account 2202 VAT Liability Account. All other VAT N/C's must be settled in the previous year. This ensures that the opening balance that is created for the new accounting year will only include what you owe or are owed in VAT.

Enteries in other VAT N/C's can be due to three circumstances:

  • Your latest VAT period has not been closed
  • Previous VAT periods have not been closed
  • A journal item that has been entered contans VAT transactions in period 13.

In regard to the first two issues, slect View - Accounting - Period End. You will close a previous VAT period when you close the last accounting period within a VAT period.

 

VAT Entries in Period 13

If you have made journal enteries in period 13 that contain VAT amounts, you must settle these manually. These items will not be included in the system generated VAT return. To find out how the settlement journal is posted go to View - Financials - Journal List and view the journal type VAT Settlement in the dropdown menu provided.

Here is an example based on having found a debit balance of £/€ 300 in account 2200 when printing out the Trial Balance report.

Accounting year: 2007

Period: 13

Date: 31.12.2007

Journal Type: Miscellaneous

Account Name Debit Credit
2200 VAT on Sales   3.00
2202 VAT on Liability 300.00  

 

This journal entry has now cancelled out the total account 2200 so that it is only the VAT Liability that will show a total at Year End.


Query words: VAT, year end,