Why are you seeing incorrect values in the VAT 100 VAT Return report in Dynamics GP?
The reason is linked to the way in which the VAT 100 module has been designed.
In essence, it looks like Microsoft decided that you should not have too much control over the values, and they they would figure this all out for you, in the same way that most of the basic low-end accounting systems do, but then realised that they needed to account for different countries.
So, they also included a set of parameters which relies on the country codes of customers and suppliers to determine whether which boxes the tax values and net values should be placed in.
This is all good and well, but, in practice, it doesn't seem to work. This is for two main reasons:
1) Most customers and suppliers, if they are located in the same country as your own, won't be setup with a country code, as this just adds an extra manual step to the setup process, and is therefore usually ignored.
2) All transactions related to customers or suppliers without country codes are simply ignored when producing the VAT Return because the algorithm doesn't know how to treat those transactions - even if the transaction has a tax schedule assigned. Furthermore, you don't get any details or print outs as to what has been includes, and what has not.
So, reconciling the suggested VAT 100 report's results with the 'real world', is almost impossible.
If you find yourself in this position, then I feel for you! All the additional manual effort required to get the proper results just takes so much time.
I know of clients that used this module, and it used to take them 3 days to complete their VAT Return!
Just because they could not trust what the system was telling them.
And in the end, they just typed in the values that they wanted to submit, and ignored the values suggested.
The whole point of a VAT Return module is to save you time, and from our experience, the VAT 100 module in Dynamics GP does nothing of the sort.
How do I produce a VAT Return in Dynamics GP with correct values?
Our strong recommendation is to use the Dynamics GP VAT Daybook module.
The VAT Daybook module in Dynamics GP gives you full control over the Tax Details that you want to add into each of the VAT Return boxes, as well as those tax details (like the ones you use for internal transactions or those that are out of scope) that you want to exclude from the VAT Return.
The thing our clients love the most about it, is that you get a complete, itemised breakdown of every transaction that is included on the return, what values are added to which box, as well as a set of reports showing you want has specifically been excluded.
These reports give you full visibility, and therefore trust, in the reports, and gives you the opportunity to correct tax mistakes (such as when transactions have been assigned to the incorrect tax codes), and add the adjustments you need via the GL too.
This saves loads of time in comparison with the VAT 100 report. The clients that used to spend 3 days running the VAT Return now complete the process within two or three hours - fully submitted to HMRC.
Leave us a comment below if you have any questions, or check out our training videos (subscription required) to see how to setup this up and run it.