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VT Transaction+

Navigation: Value Added Tax

Changing the standard VAT rate

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Background

It is important to note that the standard VAT rate set up in VT Transaction+ is used as an aid to calculation only. What actually matters is the amount of VAT entered in the VAT boxes in the transaction entry dialogs.

 

Changing the rate

To change the standard VAT rate in a company ('the company VAT rate'):

1.Open the company (for instance using the File>Open Company command)

2.Choose the Set Up>VAT command

3.Click the VAT rates tab

4.Enter the new rate and click OK

You need to do the above for each company/business data file.

 

Entering transactions at the old and new rates

Depending on the time of supply, you may have to enter some transactions at the old rate, while entering others at the new rate.

Once you have changed the standard rate, you can set up an additional rate as the old rate. This will allow you to select either the new standard rate, or the old rate, when entering a transaction.

The only exception to this is if you are using VT Transaction+ to issue and print sales invoices. The VAT on these invoices is calculated at whatever rate is set up for the company.

To create an additional VAT rate:

1.Open your company (using the File>Open Company command)

2.Choose the Set Up>VAT command

3.Click the VAT rates tab

4.Click on Number of VAT rates and increase the number

5.In the newly created VAT rate box, enter the old VAT rate.

For details of determining the time of supply for VAT purposes, you should refer to HMRC guidance here.

 

Issuing invoices to customers

If you are using VT Transaction+ to issue and print invoices, you must set the company VAT rate to the correct rate. If you have to issue an invoice or credit note at the old rate, you need to temporarily change the company VAT rate back to the old rate. However, if a credit note is for an entire invoice, it is easier to create it by clicking on the invoice in any report with the right mouse button and choosing Raise Credit Note from the pop-up menu. The VAT rate on the credit note will be the same as the original invoice and hence there is no need to temporarily change the company VAT rate.

If you edit a saved invoice by clicking on it with the right mouse button and choosing Edit Transaction from the pop-up menu, the VAT rate set up when the invoice was entered will be retained. However, there is an Update VAT rates option in the Edit Transaction dialog. This changes the rate to the current company VAT rate.

 

New company/business data files

When you create a new data file using the File>New Company command, the company VAT rate is initially set to whatever is set up in the chart of accounts template that was selected. The rates in these templates will be updated by VT Software when you next install a new version of VT Transaction+. If you want to update the rate before then:

1.Open the template by choosing the File>Templates>Open command

2.Choose the Set Up>VAT command

3.Click the VAT rates tab

4.Enter the new rate and click OK

Repeat the above for each template.