How to record a VAT Refund - UK only

NOTE: Before you record the refund, you must reconcile the VAT Return and complete the VAT transfer.

When a refund is due, a debit balance appears in the VAT Liability nominal account. This occurs when the amount of purchase tax that can be reclaimed exceeds the amount of sales tax that is to be paid.

To record the refund, a bank receipt is posted using the VAT Liability nominal code.

In this example, a refund of 1,250.00 has been received.

1. Click Bank accounts and click Bank receipt.
2. Enter the relevant details on the Bank Receipts window:
   
   

   Bank	1200
   Date	Date of the refund.
   Ref	VAT
   N/C	VAT liability nominal account, by default 2202.
   Dept	If required enter a department.
   Details	VAT Refund
   Net	1250.00
   T/C	Non-vatable tax code - Find out more >, by default T9.
   Tax	0.00

3. Click Save and click Close.

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