Entering Manual VAT Adjustments on the VAT Transfer Document
You may need to enter an adjustment on your VAT transfer document for things like partial exemption. Please note any manual adjustments will need to be calculated prior to entering the information on the VAT Transfer document.
Organisations using Making Tax Digital (MTD), any partial exemptions must be posted before creating the VAT Transfer document and making the submission.
For Claims being submitted through MTD, the system uses the values posted to the VAT Input nominal
To reduce the value of the VAT Input to be included in the VAT claim to account for the partial exemption, before submitting the claim, to reduce the value on the VAT Input nominal, post a General Journal (**GJ) as:
Credit — VAT Input Nominal
Debit — VAT Adjustment Nominal
A VAT adjustment transfers the adjustment amount from the VAT control to the nominated cost centre account as shown in the following graphic.
Prior to posting a VAT adjustment, you must have a suitable cost centre account to post the adjustment to. Please see Creating cost centre accounts.
To add a manual VAT adjustment:
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On the VAT Transfer document input select the Adjustment Account field.
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The Select Account dialog is displayed. Double-click the applicable cost centre to post the adjustment to.
If you do not have a suitable cost centre account, then you can set one up. See Creating cost centre accounts
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The Select Account dialog will close and you will return to the VAT Transfer input form. Click the Adjustment Value field and enter the adjustment value.
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Press F5 to post the document. The VAT Transfer document is posted and the adjustment value is posted against the applicable cost centre account.