Accounting for VAT for Councils registered for VAT

THIS FEATURE IS UNDER DEVELOPMENT AND HAS NOT YET BEEN MADE AVAILABLE

Most Councils will not be registered for VAT and will use the VAT126 form for reclaiming VAT on non-business purchases. However, there will be some Councils who are registered for VAT, usually because they make some taxable supplies upon which they need to charge VAT. For this we provide the facility to create data for a VAT100 form.

Note that we do not provide a facility to file VAT information via Making Tax Digital. Despite what you may have read elsewhere, Parish Councils with VATable turnover less than £85,000 can still submit VAT returns using the current method.

The facility is accessed from the appropriate menu under Managing VAT. You are requested to enter the date for the return (which will be the date required in your VAT registration) and when OK is pressed the appropriate VAT100 form is displayed.

It is important to note a couple of points:

  • Although Boxes 2, 8 and 9 are shown they will always be zero. At the moment we have no way of including overseas VAT
  • The output turnover does not include items that are out of scope or exempt. It is important that you label these items appropriately. Thus, the precept and bank interest should always be labelled as out of scope and, for example, cemetery fees charged by the Council will be exempt.
  • The input turnover includes items that are exempt but not out of scope. Again, it is important that the correct codes are used so that, for example, supplies of goods or services by a non-registered supplier will be exempt while salaries, PAYE and pension contributions are out of scope. Any interest paid will be out of scope but bank charges are exempt.

All payments made by the Council up to and including the chosen date are included; it is not necessary for this method of accounting for VAT that the VAT number is recorded for the supplier or the invoice date for the payment although you can record this information if you wish.