When you need to move values between ledger accounts, you use journal entries. Normally, journals don't show up on the VAT return. However, if needed, you can include VAT in your journals and report them on the VAT return. The table below shows which box on the VAT return gets updated after you enter a journal. The update depends on the ledger account and whether the journal line is a debit or a credit.  NOTE: If you use the Flat rate VAT scheme, you can't create a journal that directly affects Box 1.
| Ledger Account | Default Nominal Code | Credit or Debit | Affects the VAT Return | | VAT on sales | 2200 | Credit | Increases Box 1 | | VAT on sales | 2200 | Debit | Decreases Box 1 | | VAT on purchases | 2201 | Credit | Decreases Box 4 | | VAT on purchases | 2201 | Debit | Increases Box 4 | | Any income account | 4000 to 4940 | Credit | Increases Box 6 | | Any income account | 4000 to 4940 | Debit | Decreases Box 6 | | Any expenditure account | 5000 to 9999 | Credit | Decreases Box 7 | | Any expenditure account | 5000 to 9999 | Debit | Increases Box 7 | | Any other ledger account | | Credit | Increases Box 6 | | Any other ledger account | | Debit | Increases Box 7 | Related articles |