Vat registration and Pastel

[CORMAC]

Hi everyone,

I am helping out a friend with their accounts. Their company was just registered for VAT and this has been applied retrospectively from 1/12/2013. It is my understanding that all processing will have to be re-processed to reflect this. I would like to know how on earth do I reverse supplier invoices that have already been paid so that I may account for the VAT?

Would it be acceptable if I merely credit the relevant expense by the vat amount and debit vat control?

Thank you to all in advance.

[Neville Bailey]

The best method, for the Supplier Invoices, would be as follows:

• Process Return Debits for each of the Supplier Invoices
• Enable VAT processing in Pastel, if it hasn't been done already (go to Setup...Tax)
• Recapture the Supplier Invoices and use the tax type 01 where applicable

With regard to any cashbook payments that were allocated directly to expense accounts, and for which VAT can be claimed, recapture the cashbook payments exactly as before, but with a minus sign in front of the amounts, and the recapture them again with the tax type 01 in the tax column, using positive amounts. If the tax column does not display, go the Settings button in the batch and tick the box named Tax Processing.

You will have a problem with regards to Customer Invoices, because you probably did not charge VAT to the customers, yet you will be liable for the VAT portion (1/1.14 x 0.14) of those invoices. These invoices need to be reversed by means of Credit Notes (using a tax type 00) and then re-invoiced with the tax type 01, using the total original value of the invoices as the inclusive amount.