Hi Paul,

Thank you for the response.

1)Good to hear that this is incorporated in 8.5

2)I believe it is a legal requirement for the tax payer to maintain records that support the returned values see VAT Notice 700 para 19.2 and VAT Notice 700/21. The VAT Outputs and Inputs are fine as the Hansa records that support the numbers declared are driven directly by the two nominal accounts and it seems the VAT listing supports the net value of sales, it is the net value of purchases where we seem to have a problem.

Without a definitive list of transactions that support the net value of purchases then on a compliance review the HMRC officer would not be able to confirm which purchase invoices have been included and which have not. Without information to explain what is incorporated in net purchases then HMRC could issue an assessment based on the industry average of VAT recovery based on the declared purchases. On every VAT compliance visit I have attended I have had to explain why the VAT on Sales is not 20% of the net sales declared and without a detailed report I would not have been able to do so. It is therefore entirely likely that HMRC could ask for the same explanation where the VAT on purchases as a % of net purchases declared is inconsistent with the industry average. Without the detailed report to explain any deviation we could face an unwarranted tax liability and possibly penalties.

I really think this should be a standard report available within Hansa, otherwise the software just does not comply with the legislative requirements.

Thank you.

Gary

Hi Paul,

The nominal report for VAT Inputs in the discrete quarter agrees perfectly to the VAT return. There is a small prior period entry that means the closing balance does not but hopefully with the changes you mentioned in the previous reply where invoices will be electronically date stamped when they are submitted this will become easy to track down.

My problem is with the Net Inputs (Box 6 on the VAT return) where there is no report to support the numbers presented in the return. It seems I am lucky that the Net Outputs (Box 7 on the VAT return) is fully supported by the VAT listing but I could imagine there are Hansa users where this may not be the case. I guess if Hansa are looking at a report to support the Net Inputs then they may as well do Net Outputs as well!

Kind regards.


Gary