Final vat return

[sinewove]

As above,have deregistered for vat(I was in cash accounting scheme) and am filling in final return,end date 13/11/20.
It seems,I have to account for vat on sales invoices unpaid on 13/11.Do I enter the entire invoice details or just the vat
content for the final payment?Also for inputs,can I reclaim vat on goods bought prior to 13/11 if not payed for at that
date?Thanks for any help,
Regards,
S

 

[plugsandsparks]

Never de-registered but the principles are straight forward. As you were using the cash method (which i use) , then there are going to be transactions in the pipeline which would normally go to the next quarter but as this is your last one this cannot happen. The risk for you is that any invoice you have not been paid yet is a debt risk and also a VAT risk. So i would be seeking some re-assurance that you will actually be paid.

To answer your specific question, i would hope whatever form you are filling in has some guidance notes, but whatever, be very consistent with VAT raised (invoice) and VAT reclaimed (purchases) .

If the date is the 13th, then any unpaid invoice that you have raised VAT for you will have a liability to HMRC and any purchase that you have not yet paid for prior to the 13th, can be used to offset that liability.

If it were me i would do the math first on a bit of paper, work out my remaining liability then use the HMRC form to make sure the numbers tally.

If you try and upload the form i can have a look at it.

cheers
P&S

 

[sinewove]

Never de-registered but the principles are straight forward. As you were using the cash method (which i use) , then there are going to be transactions in the pipeline which would normally go to the next quarter but as this is your last one this cannot happen. The risk for you is that any invoice you have not been paid yet is a debt risk and also a VAT risk. So i would be seeking some re-assurance that you will actually be paid.

To answer your specific question, i would hope whatever form you are filling in has some guidance notes, but whatever, be very consistent with VAT raised (invoice) and VAT reclaimed (purchases) .

If the date is the 13th, then any unpaid invoice that you have raised VAT for you will have a liability to HMRC and any purchase that you have not yet paid for prior to the 13th, can be used to offset that liability.

If it were me i would do the math first on a bit of paper, work out my remaining liability then use the HMRC form to make sure the numbers tally.

If you try and upload the form i can have a look at it.

cheers
P&S

Thanks P and S,
So just taking the inputs,I can reclaim vat on purchases made before the 13th,even if I pay for them at the
end of December.So cash accounting does not apply to final return?
Regards,
S

 

[plugsandsparks]

Yes the date is the date. Your supplier invoice must be before 13th, it does not matter when you pay it.

Also your customer invoices will also be before the 13th BUT you may not get paid, that is the risk.

 

[sinewove]

Yes the date is the date. Your supplier invoice must be before 13th, it does not matter when you pay it.

Also your customer invoices will also be before the 13th BUT you may not get paid, that is the risk.

Thanks for the help,
Regards,
S

 

[Darkwood]

I would also advise you do not deregister until all income has been received, if you have stopped trading then as you are cash accounting in method you need to ensure all invoices are paid and then do the final VAT calculation in next quarter.
If in doubt ask your accountant if you have one or contact HMRC and simply ask... the issue here is if any customer defaults on payment, goes bust etc then you would lose out by paying it upfront hence it is best to wait until all invoices are settled before you deregister.
Just to add the customer reclaiming VAT on your invoice needs you to be registered to legally reclaim, if you are no longer registered you could be causing issues for the customer, as long as you remain registered at the time they pay the invoice then they are not going to have a accounting headache.

 

[sinewove]

I would also advise you do not deregister until all income has been received, if you have stopped trading then as you are cash accounting in method you need to ensure all invoices are paid and then do the final VAT calculation in next quarter.
If in doubt ask your accountant if you have one or contact HMRC and simply ask... the issue here is if any customer defaults on payment, goes bust etc then you would lose out by paying it upfront hence it is best to wait until all invoices are settled before you deregister.
Just to add the customer reclaiming VAT on your invoice needs you to be registered to legally reclaim, if you are no longer registered you could be causing issues for the customer, as long as you remain registered at the time they pay the invoice then they are not going to have a accounting headache.

Have not stopped trading,so income is ongoing.From the 13th no vat was charged on invoices and vat number dropped,so hopefully any customer (registered)can reclaim vat before that date,
S

 

[Darkwood]

Have not stopped trading,so income is ongoing.From the 13th no vat was charged on invoices and vat number dropped,so hopefully any customer (registered)can reclaim vat before that date,
S

In that case then just be careful in that you notify all VAT registered companies you do business with and invoice to that they are aware of your impending VAT deregistration, I assume this won't affect many of your customers given your choice to do so as many VAT registered companies will not contract in non VAT registered tradespeople as it stops them claiming back on your invoices, I can only assume if you are continuing trading that you are concentrating on the domestic market which is the only reason I could argue deregistering, domestic is the only market VAT registration has a negative impact and puts you at a disadvantage when quoting for a job.