How do I deal with VAT on imports?

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Revision as of 11:54, 18 December 2018 by Nigel Smith (talk | contribs) (Posting the invoice for Import duty)
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Summary

If you import goods from outside of the European Union you may be able to claim back the VAT using the reverse charge procedure. This article will explain how to deal with this in Platinum. You need to make sure that this is relevant to your business, check with your accountant to be certain, you will also only be able to do this if you have been sent a C79 VAT Certificate as this is needed to support your claim for Input tax.

More Information

Before you start dealing with this you will need to set up an accruals nominal code for the postings and also link this to a purchase center, the accruals nominal will need to be an Asset/Liability centre on your balance sheet. For more information on setting up the nominal code see here. For how to create a new purchase centre see here. You should also create an account on the purchase ledger for HMRC to deal with the C79 certificate. See here for how to create a new account.

Posting the invoice for Import duty

You will receive an invoice from your shipping company for the import VAT this should be posted in the same way as a normal supplier invoice with the value coded to your new purchase centre see here for how to post a purchase invoice.

The Invoice can be paid of in the usual manner.

Posting your C79 VAT certificate

The C79 VAT certificate should be posted as a VAT only credit, see here for how to create a VAT only credit.

Once you have posted the VAT certificate then you should pay this off to the new accruals nominal centre you created earlier.

This should bring you accruals nominal back to zero, if there is a difference between the charge for the shipping company and the VAT certificate you will need to be journal this to a cost of sale centre.

See also


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Keywords AND Misspellings
VAT, V.A.T, Import, Import VAT, reverse charge procedure,