VAT adjustment journal
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There may be times when you need to change the VAT liability on your VAT return without amending sales invoices, purchase receipts or bank transactions. This can be done using a VAT adjustment journal.
Create the journal entry
You must enable journals before proceeding if you have not already done so.
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Go to Journals and select Create a new journal.
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In Comment, enter
VAT Adjustment. -
Edit the Date to any date within the applicable VAT period. For example, if you were running the return for Q1 2023 you need to date this journal between 01/01/2023 and 31/03/2023 otherwise it will not appear in the return.
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Select VAT journals from the Category list.
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Enter the VAT nominal codes and amounts.
Typically, the following codes are used:
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Input VAT – this is the VAT recorded on purchases and outgoings.
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Output VAT – this is the VAT recorded on invoices and money received.
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VAT control – this account keeps track of the VAT account balance.
If you are unsure what to enter here, it is best to consult your accountant as this will affect your VAT return.
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.
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Select Trade border type, and Save.