Vat Return Calculations

[HJC]

I am using Sage 50 2012 and I am having trouble with my vat return calculations. I enter invoices using either T9 or T1, whichever applies and my journal entries are either T1 or T9. Everything appears correct however on my vat return the total sales amounts to 64,100.86 and it shows the vat amount due as 12,784.70 which is not quite right likewise the purchases at 16,319.96 shows vat of 3,363.63 both vat figures are out as vat is 20 %. I would be grateful of any ideas what is going wrong.

[brucedenney]

What journal are you doing on T1? that is very unusual, it would add to your VAT turnover without adding VAT, I suspect that you don't really want to be doing that. If you tell me what it is for I might be able to suggest a better way.

If you drill into the figures on the VAT return, you will see what makes them up. (You can also use the details reports).

Are you on standard VAT accounting or Cash accounting?

[HJC]

It's cash accounting, (I think, I've taken over from an ex employee) I work in a hotel so the journal entries for T1 are the figures for accommodation, food and drink sales, the T9 figures are the monies received in payment. As far as I know they have always been that way.

[HJC]

I also process Petty cash purchases. I use T1 for the vat (code 2201) and T9 for the remaining, will this cause a problem?

[brucedenney]

Yes, you should do them as bank(petty cash) payments as T1 with a vat amount associated with them.
For the non VAT transactions you should not normally be using the T9 tax code (unless it is wages) as they should be reported as part of your turnover.

Journalling into the VAT account does not put anything on the VAT return in the way of VAT it just puts an amount in the control account.
If you used the T1 tax code on a journal then the value of that journal will be reported as part of your taxable turnover.