The Receipt screen is used to record receipts of monies from external parties which will generally either represent a customer payment NOT related an invoice, a customer payment on account, income, cash takings or a receipt from a supplier (refund). VAT accounting can be completed if appropriate.
The Receipt screen can also be used to record miscellaneous deposits arising out of non-trading activities such as loan repayments from an employee, a grant or commercial loan to the organisation.
Enter any reference to be associated with the transaction.
The date of the transaction. Dates can either be entered manually or selected from the pop-up calendar by clicking on the icon. Dates must be entered in the format DD/MM/YYYY, for example, 01/01/2000.
When entering dates manually, a date guessing routine speeds up the input by taking the user input and assuming the missing month and or year based on the current date as the user leaves the field i.e.
the date today is 30th October 2009.
- User enters 15 or 15/ and tabs - field displays 15/10/2009
- User enters 15/9 or 15/9/ and tabs - field displays 15/9/2009
In most instances you would define the 'From' as the customer from whom monies are being received but the are cases where it would be related to another party such as supplier (refund), employee, company/LLP member, or a tax authority (HMRC).
If the receipt isn't to be associated with a counterparty it may be left blank.
NOTE - not-for-profit users recording donations should record them under the Donations menu option.
Auto-complete field names
Rather than a drop-down to select from a list, simply start typing and the system will identify any occurrences of the combination of characters entered and you select from that shorter list. As an example, type 'able' and the system will offer:
Adding new customers / suppliers
If the combination of characters you enter does not provide any results, press tab and the system will know you need to add the customer/supplier and ask you to confirm the details. At this point add address, email contact etc if required.
Select the Bank Account associated with the transaction.
A default may be displayed if it has been set on a Bank Account Details Record. This default may be overwritten.
To set a default, if it has not already been done, navigate to the Bank menu and hover over the Bank Account that is to become the default and click Configure Account.
Tick the Default Box and then SUBMIT.
Note there can only be one default so if another Bank Account was previously set as the default its status will be reset to be not the default.
ADD ITEM button accesses the line item input. Select the Item from the drop-down.
SAVE ITEM button saves that line item in the screen. Clicking ADD ITEM button on each occasion allows user to enter further line items. UNDO ITEM cancels the current line item data.
The account drop down list is used to associate the line item of a transaction with an account from the chart of accounts.
- If nothing is displayed either
- simply start typing an account name or ledger code and the system will provide a list of potential selections; choose the required account by clicking on it.
- or click the icon
- to display a list of document-type sensitive account possibilities. Note to change to other account-type options click the small down arrow at the base of the screen
- If an account is displayed
- In many instances once a counterparty (customer, supplier or employee etc) has been selected the account box will display a default learned account. For other associated learned accounts click the icon. Note to change to other account-type options click the small down arrow at the base of the screen
The net amount associated with the item.
When recording purchases, if you have a gross amount and want liberty to calculate the net amount and vat amount simply enter the gross amount in this field, select the appropriate VAT code, and type "g" in the VAT amount field.
The appropriate VAT rate for the account must be selected. Default VAT rates can be associated with an account via the Account Maintenance screen which is available from the chart of accounts view.
If the business is on the HMRC Flat Rate VAT Scheme, as defined on the VAT details tab of the Business Profile, the VAT rate will default to "Out of Scope" for all purchase transactions. This can be changed if necessary. Exceptions may apply for purchases of capital assets of significant value, please consult your professional advisor.
Current VAT Rates
20.0%, 5% & Zero, used for normal UK VAT transactions.
Used when a transaction is an exempt supply; such as the purchase of insurance. See the VAT Guide (Notice 700) for more details or visit the Revenue and Customs site at www.hmrc.gov.uk
Ended 31/12/2020 except for Northern Ireland - EU Acquisition
Used when you purchase goods from a VAT registered supplier in an EU member state. Make sure that the VAT code is set to EU Acquisition, and that the VAT amount shows the VAT which would have applied if the purchase had taken place in the UK. The correct country must be set on the supplier record to ensure correct reporting of the transaction.
No longer in use , kept for historical record only - EU VAT
Only used if you have you have incurred VAT in an EU member state, (i.e. local VAT). This CANNOT be recovered as input tax for UK VAT. You may make a claim for refund from the member state. A scheme exists to do this known as "Refunds of VAT in the European Community for EC and non-EC businesses" The details are in notice 723, refer to the Revenue and Customs site at www.hmrc.gov.uk Use of this VAT code is described more fully in the "VAT and Liberty Accounts" user guide.
Out of Scope
Used when a transaction is not in the VAT system at all. For example payments into a money purchase pension scheme are out of scope because they are equivalent to savings. Recording a payment of VAT to HMRC is a common example where Out of Scope should be used, as are salary payments and repayments of director loans. Using this code will result in no VAT reporting impact.
This code is used where there is no VAT on a purchase transaction, typically from a supplier who is not vat registered. This is not the same as zero rated, exempt or out of scope. The impact is that the value of the purchase is included in box 7 of the VAT 100 return.
20% and 5% Domestic Reverse Charge (Used on Sales Invoices only)
Use either of these codes when a sales invoice is being raised that is subject to domestic reverse charge VAT. This has the impact of not adding a VAT amount to the invoice total but annotates that domestic reverse charge applies.
Where domestic reverse charge apples to a customer (receiving a bill with domestic reverse charge notification) see the special note below.
This code can be used where there the transaction is recording an aggregation of mixed VAT codes in a single entry with the VAT amount manually set as required.
Import VAT (Used on Purchases only)
This code is used if the organisation buys goods from outside of the UK for use in the business then it may use a system called postponed VAT that allows it to account for VAT on the VAT 100 return rather than paying VAT immediately at the point of entry. This is a potentially complex area and so we strongly advise you consult with your advisor.
Special Note - Reverse Charge VAT
Reverse Charge VAT
Reverse Charge Procedure (for services from foreign suppliers)
If you are a VAT registered business in the UK and receive services from suppliers in other countries you may have to account for VAT to HMRC. This is known as reverse charge. The system provides a procedure for dealing with this.
Enter the transaction normally and select an appropriate Standard Reverse Charge VAT rate that would apply if the purchase had taken place from a UK supplier. The appropriate entries are made to the VAT100 report and any VAT transaction reports.
The system impact is to add to the VAT control account an amount of output tax (as if a sale) calculated on the full value of the supply received, at the same time add (subject to the normal rules for deduction of input tax) the same amount of VAT as input tax to the VAT control account. The net impact on VAT is zero; additionally the VAT100 return also displays sales and purchase values in the appropriate boxes.
Domestic Reverse Charge
Domestic reverse charge is essentially an anti-fraud measure and applies to a range of goods and services transacted between UK VAT registered suppliers and customers and includes:-
- Mobile Phones
- Computer Chips
- Wholesale Gas, Electricity and Telecommunications
- Emission allowances and renewable energy certificates
- Building and construction services, both buying and selling (from 1 March 2021)
For customer receiving a bill subject to domestic reverse charge
Enter the bill or payment in the normal way select an appropriate Domestic Reverse Charge VAT rate that would normally apply as notified on the bill. The appropriate entries are made to the VAT100 report and any VAT transaction reports.
The system impact is to add to the VAT control account an amount of output tax (as if a sale) calculated on the full value of the supply received, at the same time add (subject to the normal rules for deduction of input tax) the same amount of VAT as input tax to the VAT control account. The net impact on VAT is zero; additionally the VAT100 return also displays sales values in the appropriate box.
Note that the system distinguishes between domestic and non domestic reverse charge by the country stored on the supplier record.
The amount of VAT charged on this item is automatically calculated based on the vat code selected but can be changed.
When recording purchases, if you have a gross amount and want liberty to calculate the net amount and vat amount simply enter the gross amount in the net amount field, select the appropriate VAT code, and type "g" in the VAT amount field.
If required select an appropriate branch or fund (in the case of a Not for Profit Organisation) to which the transaction is analysed.
If required select an appropriate activity to which the transaction is analysed.
Departments, Activities and Funds
Line item entries may be analysed to Departments and/or Activities where this has been activated. In addition, for Not-for_profit Organisations a Fund must be selected.
In each case use the drop-down to choose the analytical area appropriate to the line item. If no selection is needed just leave the field or select Not Applicable.
For information about analysis areas see Sites, Departments and Activities
When ready click SUBMIT to complete the transaction.
Once a receipt has been created and stored, a user Opening the transaction will see , just below the header area, an action box symbol. This provides quick access to: -
- Memorise and Schedule
to open a screen to set up a memorised or scheduled transaction based upon this transaction. More information is available from this Memorised Transactions link.
to open a transaction audit report that provides a non-editable history of the transaction and its accounting impact. The report details which user recorded the initial transaction together with the date and time as well as the details of any subsequent amendments.
- to remove the receipt. Note if a receipt has been included in a filed Cash VAT return the delete option will not be available.
Dealing with Church Collections
Most churches will have at least weekly collections of cash, cheques, gift-aid envelopes and perhaps card reader postings. This topic Regular Church Collections and Cash/Undeposited Receipts offers some help for dealing with the mix of income in an efficient manor for both the user and the system.