Reverse Charge VAT and MYOB

[Chris]

Anybody have a clue how to account for reverse charge VAT using MYOB?

-- Chris

 

[Troy Steadman]

Anybody have a clue how to account for reverse charge VAT using MYOB?

-- Chris

Okay "reverse charge VAT" - are we talking "Self-Invoicing"?


--

 

[Chris]

No

My webhost is in the USA so bills me without VAT but I have to reverse
charge the VAT on my VAT return (just about to do the 1st one hence the
question!)

Although MYOB has a nice system for doing this for intra EC trading, I can't
seem to find a way to do this for non-EC purchases

-- Chris

 

[Peter Saxton]

No

My webhost is in the USA so bills me without VAT but I have to reverse
charge the VAT on my VAT return (just about to do the 1st one hence the
question!)

Why do you have to "reverse charge" and what is it?

 

[Jonathan Bryce]

Why do you have to "reverse charge" and what is it?

When someone supplies electronic services to a customer within the EU, they
are required to charge VAT on the supply. If the supply is to a
non-business customer, then they charge it to the customer and pay it over
in the normal way.

If however, the supplier is outside the EU, and they are supplying to a
business within the EU, then the customer can make a declaration to the
supplier that they are a business, and the supplier will not charge VAT on
the invoice. Instead, the customer will declare it on their VAT return,
and claim it back if necessary. If they aren't a VAT registered business,
then they have to send their payment to Customs by some other means.


To answer the original question, he is going to have to somehow enter an
sales invoice into MYOB, and, since he presumably wants to claim it back as
Input VAT, somehow enter a purchase invoice.

I'm not familiar with MYOB, but if it is anything like Sage, the procedure
would be as follows:

Set up a sales ledger account called Sales Ledger Suspense
Set up a purchase ledger account called Purchase Ledger Suspense
Set up a bank account called Bank Suspense
Set up a nominal ledger account called Suspense

Enter a standard rated sale for the amount of the purchase which debits the
Sales Ledger suspense, and credits VAT and the Nominal ledger suspense

Enter a standard rated purchase for the same amount which credits the
Purchase Ledger suspense and debits VAT and the Nominal ledger suspense


The VAT return will now be correct, but the sales and purchase ledgers will
be out. To correct this, pay the debtor on the sales ledger suspense into
the suspense bank account, and use this money to pay the purchase ledger
suspense creditor.

 

[Peter Saxton]

When someone supplies electronic services to a customer within the EU, they
are required to charge VAT on the supply. If the supply is to a
non-business customer, then they charge it to the customer and pay it over
in the normal way.

If however, the supplier is outside the EU, and they are supplying to a
business within the EU, then the customer can make a declaration to the
supplier that they are a business, and the supplier will not charge VAT on
the invoice. Instead, the customer will declare it on their VAT return,
and claim it back if necessary. If they aren't a VAT registered business,
then they have to send their payment to Customs by some other means.

Isn't it if they are VAT registered rather than being a business?

To answer the original question, he is going to have to somehow enter an
sales invoice into MYOB, and, since he presumably wants to claim it back as
Input VAT, somehow enter a purchase invoice.

I'm not familiar with MYOB, but if it is anything like Sage, the procedure
would be as follows:

Set up a sales ledger account called Sales Ledger Suspense
Set up a purchase ledger account called Purchase Ledger Suspense
Set up a bank account called Bank Suspense
Set up a nominal ledger account called Suspense

Enter a standard rated sale for the amount of the purchase which debits the
Sales Ledger suspense, and credits VAT and the Nominal ledger suspense

Enter a standard rated purchase for the same amount which credits the
Purchase Ledger suspense and debits VAT and the Nominal ledger suspense

Shouldnt a normal purchase ledger supplier account be used?