q&a on the vat rate changes
We've listed below some of the common questions we get asked. Just choose the section you're interested in.
If you have any other questions about the effect of the VAT changes in your TAS program, then please email our Software Support Team and we'll answer your questions here.
- I already have 21% VAT rates in TAS. Can I just use these rates, or do I need to set up new VAT rates?
You may already have 21% VAT rates in your TAS program, as this was the standard rate before 1 December 2008. If you already have 21% VAT rates you can use those and you won't need to set up new rates. Don't forget to follow through the rest of the advice to make sure that your default VAT rate is set correctly, etc. - Do I need to use a different VAT rates in TAS? Why can't I just amend my existing standard rates to be 21%?
Yes, you need to use a different VAT rates for 21% Resale and Non-Resale Standard Rate VAT - if you just amend your existing rates you might find this causes you problems later on. For example; if you receive a late invoice from a supplier, if you have to issue a credit note to customer that relates to an invoice from before the VAT rate change, or if you need to edit a transaction for any reason. Using a different VAT rate in TAS will help prevent a transaction accidentally being recorded with the wrong VAT rate. - I need to issue a credit note to a customer, but it relates to an invoice issued before the VAT rate change. What VAT rate do I show on the credit note?
When issuing a credit note, you should always use the same VAT rate that was used on the original invoice. - I've issued an invoice with a 21.5% VAT rate, and now realise the rate should have been 21%, what should I do?
If you've issued an invoice with an incorrect VAT rate, you can create a VAT only invoice for the difference in VAT amount. When you receive the customer's payment, you can then allocate the payment against both invoices.
Alternatively, if your customer requires an invoice showing the new VAT rate, enter a Credit Order to reverse out the original transaction at the old VAT rate, then enter a Sales Order with the correct details and the new VAT rate. - How can I ensure new products I create use the new VAT rate by default in TASBooks (or TAS BOOKS 2 and 3)?
To ensure the new VAT rate is used by default when you create new products, from the menu bar select Central > General Company Information > TASBooks Configuration (option 012, or option 011 in some older programs). In the left-hand pane select Default Settings and in the right-hand pane scroll down to the Product section. In the Product section select VAT rate, and from the drop-down list, select the 21% Resale VAT rate. Click OK then click Yes to save the entry. - How can I ensure new products I create use the new VAT rate by default in FirstBooks (or TAS BOOKS 1)?
To ensure the new VAT rate is used by default when you create new products, check you've followed the instructions on our website to select the new VAT rate in the Default Standard Rate in Company > Company Information > VAT Scheme. For this rate to be used by default, you should also ensure you create your products using the New Product Wizard, either by selecting File > Wizards > New Product Wizard, or by clicking Products from the toolbar then selecting Create a product. - I use Reverse Charge VAT for RCT construction transactions in TASBooks. Do I need to make any other changes?
No. If you have followed the instructions on our website to select the new 21% VAT rate as the Default Standard Rate in Central > VAT Rates and Reporting > Maintain VAT Rates (option 031), then the correct amount of VAT will be calculated for all reverse charge transactions. - I've made the VAT changes as recommended on your website, do I need to do anything different when I run my VAT Return?
No, the change in Standard Rate of VAT doesn't affect the way you run your VAT Return at all. If you have used your 21% VAT rate transactions with a tax point on or after 1 January 2010, this will automatically be picked up when you run the return, as will any transactions where the old 21.5% rate applied. You don't need to do anything different.
Note: If you use the Moneys Received basis and have unallocated cash posted prior to 1 January 2010, the 21.5% VAT rate will apply to these entries. If at a later date you allocate this cash against invoices with a 21% VAT rate, the VAT will be adjusted on your next VAT Return, which is perfectly correct. - How do I know which VAT rate has been used for the transactions on my VAT return?
If you want to see the transactions which are included on your VAT Return, click the View Detail button in the TASBooks VAT Return Manager (or if you use any other program, select 'Yes, show me the underlying details as well' in the VAT 3 Submission Wizard). The VAT 3 Report then displays each transaction included on your return, with the VAT rate applied. If you need to, you can even edit the transactions from this report, for example, if you have applied the wrong VAT rate to a transaction. Simply double-click the transaction you want to change.