Tax code finder: Import of goods when accounting for postponed VAT accounting - Sage 50 Accounts v27.0 and below

When using postponed accounting, imports of goods where import VAT is charged affects boxes 1, 4 and 7 of your VAT Return. As the import VAT and duty may not always be charged at exactly the same time as the goods you're importing, you may need to record the different elements separately.

Net + VAT - Goods and import VAT

• The imported goods plus import VAT affects boxes 1, 4 and 7 of your VAT Return.
• To do this you must create a customer account to contra the purchase invoice against.
• To record this, post separate purchase invoices for the NET and VAT amounts to the supplier, and a sales invoice to the customer contra account created, as follows:
  

  Type	Net	T/C	VAT
  Purchase invoice	Goods amount	T0	Zero
  Purchase invoice	Zero	T1 - Standard rate	Import VAT amount
  Sales invoice (Contra account)	Zero	T1 - Standard rate	Import VAT amount

• Once posted you must then contra the VAT transactions against a contra bank account:

   NOTE: If you regularly post this type of transaction, you may prefer to create a dedicated contra bank account to post the payment and receipt transactions to.

  Type	Bank account	Payment
  Purchase payment, allocated to the VAT only purchase invoice	Contra	Import VAT amount
  Sales receipt, allocated to sales invoice	Contra	Import VAT amount

   NOTE: Alternatively you can post and allocate NET only T9 Credit Notes to a Contra Nominal Code.

• If you receive a separate invoice for import duty plus VAT, record this in the same way.

Net only invoice - Goods only

• The net value of the imported goods should appear in boxes 7 of your VAT Return.
• To record this, post a purchase invoice as follows:
  

  Type	Net	T/C	VAT
  Purchase invoice	Goods amount	T0	Zero

VAT only invoice - Import VAT only

• The import VAT should appear in boxes 1 and 4 of your VAT Return.
• To do this you must create a customer account to contra the purchase invoice against.
• To record this, post a purchase invoice to the supplier, and a sales invoice to the customer contra account created, as follows:
  

  Type	Net	T/C	VAT
  Purchase invoice	Zero	T1 - Standard rate	Import VAT amount
  Sales invoice (Contra account)	Zero	T1 - Standard rate	Import VAT amount

• Once posted you must then contra these transactions against a bank account:
  
  

   NOTE: If you regularly post this type of transaction, you may prefer to create a dedicated contra bank account to post the payment and receipt transactions to.

  Type	Bank account	Payment
  Purchase payment, allocated to purchase invoice	Contra	Import VAT amount
  Sales receipt, allocated to sales invoice	Contra	Import VAT amount

   NOTE: Alternatively you can post and allocate NET only T9 Credit Notes to a Contra Nominal Code.

The balances within the Sales & Purchase Tax Control Accounts are resolved after the VAT journal has been posted following the Reconciliation of the VAT Return.

When using postponed accounting, imports of goods where import VAT is charged affects boxes 1, 4 and 7 of your VAT Return. As the import VAT and duty may not always be charged at exactly the same time as the goods you're importing, you may need to record the different elements separately.

For net values you need to create a new Tax code with the following attributes:

Net + VAT - Goods and import VAT

• The imported goods plus import VAT should appear in boxes 1, 4 and 7 of your VAT Return.
  
  NOTE: Box 7 on your VAT Return will not update until the T98 invoice has been paid.
  
  
• You must also create a customer account to contra the purchase invoice against.
• Then, to record this, post separate purchase invoices for the NET and VAT amounts to the supplier, and a sales invoice to the customer contra account created, as follows:

  Type	Net	T/C	VAT
  Purchase invoice	Goods amount	T98	Zero
  Purchase invoice	Zero	T1 - Standard rate	Import VAT amount
  Sales invoice (contra account)	Zero	T1 - Standard rate	Import VAT amount

• Once posted you must then contra the VAT transactions against a bank account:
  
  

   NOTE: If you regularly post this type of transaction, you may prefer to create a dedicated contra bank account to post the payment and receipt transactions to.

  Type	Net	T/C	VAT
  Purchase payment (contra bank), allocated to the VAT only purchase invoice	Zero	T1 - Standard rate	Import VAT amount
  Sales receipt (contra bank), allocated to sales invoice	Zero	T1 - Standard rate	Import VAT amount

• If you receive a separate invoice for import duty plus VAT, record this in the same way.

Net only invoice - Goods only

• The net value of the imported goods should appear in box 7 of your VAT Return.
• Then post a purchase invoice as follows:
  

  Type	Net	T/C	VAT
  Purchase invoice	Goods amount	T98	Zero

VAT only invoice - Import VAT only

• The import VAT should appear in boxes 1 and 4 of your VAT Return.
• To do this you must create a customer account to contra the purchase invoice against.
• To record this,post a purchase invoice to the supplier, and a sales invoice to the customer contra account created. Plus a purchase payment and purchase receipt as follows:
  

  Type	Net	T/C	VAT
  Purchase invoice	Zero	T1 - Standard rate	Import VAT amount
  Sales invoice	Zero	T1 - Standard rate	Import VAT amount

• Once posted you must then contra these transactions against a bank account:
  
  

   NOTE: If you regularly post this type of transaction, you may prefer to create a dedicated contra bank account to post the payment and receipt transactions to.

  Type	Net	T/C	VAT
  Purchase payment, allocated to purchase invoice	Zero	T1 - Standard rate	Import VAT amount
  Sales receipt, allocated to sales invoice	Zero	T1 - Standard rate	Import VAT amount