|article ID: 2024915||last updated: Wednesday, June 15, 2011|
Mamut Business Software version 14.5 includes a new methodology for handling Cash VAT.
The new solution:
Mamut has replaced the existing Cash VAT handling within the software with a new system. This takes place on upgrade to MBS 14.5. This new system records the VAT in a “clearing” account where the VAT is recorded as not due, until the cash element of the transaction takes place and the amount is then transferred to the normal VAT accounts. This offers a very clear list of all the VAT transactions in the system and shows clearly if VAT is due to for payment or if it is actually still outstanding due to the money not being paid or received.
Two new accounts have been added to the system to allow for this:
2208 VAT not due – High rate
2209 VAT not due – Low rate
Each of these accounts is a combination of both purchase VAT and Sales VAT. However the VAT amounts are separated based on the rate of VAT paid.
· Part payments will report correct VAT
· Reversing journals will report correct VAT
· Easier to manually fix transactions if there is anything wrong with the VAT report
· Better overview of the transactions that the VAT reports are based upon
Important: With the new Cash Vat handling the field Code (VAT report code) on the journal line decides if and where the amount will appear on the VAT report. We recommend that all users choose to show this column both in Journal Entry and Financial. This setting is enabled through User settings in each module.
With Sales and Purchase invoices, the VAT used will determine how the VAT report code is used on the corresponding payment.
A Sales invoice journal will typically look like this:
When you pay this, the journal will look like this:
What you have to do before upgrading:
· Print out the VAT report and check that this is correct
· Transfer your unprocessed journals in the journal entry to Financials
What you have to do after upgrading:
Existing customers using Cash VAT will have to use two different VAT reports in a transitional period. In VAT periods where payments have been recorded both before and after the upgrade, users will have to print and sum up the values on both the old VAT reports and the new ones to get the final and correct numbers.
· Payment journal where only Bank/Petty cash and sales-/purchase account is used:
Ø This must be entered using the Double entry column in Journal entry, please see example below. This is the only way to get the correct automatic VAT report code on the journal lines. Alternatively you have to manually choose the correct VAT report code on the journal lines.
The journal will then look like this:
Query words: cash vat accounting scheme