Change VAT Scheme from Cash Accounting to Standard

Find out how to move from the VAT Cash Accounting scheme to Standard VAT.

Before you change your VAT scheme

1. Enter all transactions under the Cash Accounting scheme. For example, if your old VAT scheme ended on 30 September, enter all transactions with VAT dated up to 30 September.
2. Don't enter any transactions that won't be subject to VAT. For example, from 1 October.
3. Allocate or delete all outstanding Payments on Account. This ensures that all invoices are paid on a Cash Accounting VAT scheme.
   Find out how to allocate or delete transactions:
   
   • Allocate transactions
   • Delete supplier payments on account
   • Delete customer payments on account
   • Delete a purchase credit note
   • Delete sales credit notes
4. Submit your final VAT Return under the Cash Accounting VAT scheme. Understand how to create or submit your VAT Return.
5. Delete all transactions dated after your final VAT Return
   This is to ensure no transactions remain from your old VAT scheme. You can't change VAT schemes when you have transactions from your old VAT scheme. This is because we assume these transactions will have to go on a VAT Return first.

Change to Standard scheme

1. Select Settings and then select Business Settings.
2. Select Accounting dates and VAT.
3. Use the VAT Scheme dropdown to select Standard.
4. Select Save.
5. If you deleted any transactions before changing your VAT Scheme, you can re-enter them now.

Any unpaid invoice or credit note amounts will create Scheme Transfer transactions in your account. You can view these transactions by reviewing the Audit Trail report. This means that any VAT amounts for the unpaid invoices and credit notes will move from your holding accounts. The VAT will become payable or reclaimable at that time. Your next VAT Return will include these transactions as of the date of the scheme change.

If you have been using the incorrect VAT Scheme

This usually happens when you set up the wrong VAT scheme or choose Not Registered by mistake.

To correct this, change to the right VAT scheme. Understand what to do if you've been processing on an incorrect VAT Scheme.