Sales Tax/Vat refund from Government

[Maf. King]

As an addendum - your VAT Paid & VAT Due accounts should both head to zero 
every time you do a VAT return.  Of course, they may not get there because of  
the time lag between end-of-quarter and actually doing the return, but they 
certainly shouldn't be ever-increasing.

I'm speaking about the UK, by the way! YMMV elsewhere in the world...

Maf.


On Friday, 3 February 2017 13:40:23 GMT John Whitmore wrote:
> I really thought I had my head around Sales Tax, VAT where I am, but my
> accountant threw a spanner in the works, earlier today.
> 
> He saw that I had an Income account for Vat refunds and said that that was
> wrong as I'd get taxed on an Income and it's not. He said that the refund
> from Government should go into the Liabilities:VAT account, which I think
> is totally wrong as well.
> 
> So I think that VAT Refunds should go somewhere else. Maybe an asset
> account?
> 
> My Problem with getting a refund and applying that to a Liability account
> means that my laibility is increasing, that's not correct at all.
> 
> Man accounting is simple algebra but it don't half get complicated.
> 
> Cheers for any thoughts on the matter.
> 
> John
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