Post journals to affect your VAT Return - UK only

How to post journals in Sage 50 Accounts to affect your VAT Return correctly.

When you post transactions like invoices, payments and credits, the tax code you use affects the VAT Return. You can also adjust the VAT Return by posting journals, if your accountant advises to do this. The impact of the journals on the VAT Return depends on the nominal code and tax codes you use.

When adjusting the VAT Return, you can't reduce values in a box. You have to increase the values in the opposite box. For example, to decrease the value in Box 1, increase the value in Box 4

The VAT Return includes an Adjustments option as an alternative to posting journals.

TIP: See our post a nominal journal article for more information.

To post a journal

1. Go to Nominal codes then click Journal entry.
2. Enter your journals using the table below to post to the correct boxes on the VAT Return.

The default nominal codes are 2200 for the Sales Tax Control account and 2201 for the Purchase Tax Control account.

Box to affect	Journal Credit/Debit	Nominal code	Tax code
Box 1	Journal Credit	Sales Tax (2200) or Purchase Tax (2201).	T1
	Post the other side of the journal to the nominal code affected by the net amount.
Box 4	Journal Debit	Sales Tax (2200) or Purchase Tax (2201).	T1
	Post the other side of the journal to the nominal code affected by the net amount.
Box 6	Journal Credit	Any nominal code other than the Sales Tax (2200) or Purchase Tax (2201).	T0, T1, or T2.
Box 7	Journal Debit	Any nominal code other than the Sales Tax (2200) or Purchase Tax (2201).	T0, T1, or T2.
Box 8	Journal Credit	Any nominal code other than the Sales Tax (2200) or Purchase Tax (2201).	T4
Box 9	Journal Debit	Any nominal code other than the Sales Tax (2200) or Purchase Tax (2201).	T7 or T8.

3. Click Save.

Use a T9 tax code to avoid affecting the VAT Return.

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