Posted by AccountsPortal Gidon on 09 May 2011
These changes affect all VAT Registered users, regardless of your country, so please take a moment to find out how they may impact you.
New functionality has been introduced allowing full reporting of EU transactions for UK organisations. All transactions in which you specify a VAT Code will now have a new field called VAT Treatment. This field allows the user to indicate whether the VAT transaction relates to dealings with UK, EU or other International Customers/Suppliers. The VAT Treatment is then used to correctly compile your VAT Report and update the reporting Boxes relevant to transactions with non-UK parties.
How does this affect you? Well, that depends on your situation:
1. I am not registered for VAT
Jackpot! You are not directly affected by these changes. You will, however, need to download the new Import templates if you import Customers, Suppliers or Invoices.
2. I am registered for VAT but don't transact with EU Customers or Suppliers
Don't sweat, you'll hardly even notice! As above, you will need to download the new Import templates. There is one very important change you need to be aware. The new VAT Treatment field will be available on certain transactions and in most cases you can just leave the default. The one exception is if you are processing a refund or return using the bank transactions Receive Money or Spend Money (with Type 'General'). In such cases, you will need to change the default VAT Treatment. Please read more about this at the top of VAT UK - Box by Box.
3. I am registered for VAT and transact with EU Customers or Suppliers
Double jackpot! AccountsPortal now provides for full EU VAT Reporting. You are also affected by the items mentioned in 1. & 2. above so please review these before reading about the new EU VAT features.
If you have the time, we recommend you visit the HMRC website to find out more about VAT reporting requirements for international trade. VAT Reporting requirements for International trade can be quite complex and will depend on the nature of your business as well as the nature of your Customer/Supplier (are they individuals or VAT registered entities?). Our recommended approach is that you first determine your requirements and then review them against our VAT UK - Box by Box help document to get clarity on how these transactions should be entered.