Anybody have a clue how to account for reverse charge VAT using MYOB?
Why do you have to "reverse charge" and what is it?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
When someone supplies electronic services to a customer within the EU, theyPeter said:Why do you have to "reverse charge" and what is it?
Isn't it if they are VAT registered rather than being a business?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.
Shouldnt a normal purchase ledger supplier account be used?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
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