VAT reporting and submissions are key things your business needs to do correctly in order to stay compliant. Sage Intacct has a defined process for helping you with this – find out more about it by reading our latest Tip of the Week, or watching our video demonstration!
Note: Though this article will go through VAT reporting and submissions with the UK tax solution, Sage Intacct also has tax solutions for the following:
- Australia GST
- Canadian Sales Tax
- South Africa VAT
PKF SCS is also able to build out tax solutions for other countries – like Ireland, France, and Germany – on request.
Components Involved in the VAT Reporting and Submissions Process in Sage Intacct
| Object | Description |
|---|---|
| Contact Tax Group | This allows different tax rates to be applied to customers and suppliers, based on what jurisdictions they are in. A customer, supplier or contact can only belong to one contact tax group. |
| Item Tax Group | This lets you apply different tax rates to your items. As with the Contact Tax Group above, an item can only belong to one item tax group per tax solution. Mainly useful if you’re using Order Entry or Purchasing to enter invoices. |
| Tax Schedule Map | When the Contact Tax Group and the Item Tax Group combine their information, a Tax Schedule Map is created. |
| Tax Schedule | This identifies the Tax Detail that’s applied once the map is used. |
| Tax Detail | This also identifies the GL account for posting tax. |
The following diagram is a visual representation of how all the components listed above work together when you create a VAT tax return:
The Contact Tax Group
In the top level of Sage Intacct, click Accounts Receivable, then Customers.
Click Edit next to the record of the customer you would like to edit the Contact Tax Group of.
On the next screen, click into Additional Information.
Scroll down to the section labelled Tax Calculation. Under this section, make sure that:
- The check box marked taxable is checked
- The tax solution and tax group are correct.
The Item Tax Group
In the top level of Sage Intacct, click Order Entry, then Items.
Click Edit next to the item of the customer you would like to edit the Item Tax Group of.
If you only have a UK tax solution, you will only see one check box reading Taxable, and a drop down to pick a tax solution.
However, if you have multiple tax solutions, you’ll see an entire separate tab called Item Tax Groups.
Here, you’ll find an editable table where you can alter what tax solution you’ll use for each tax group.
Note: If you need to, you can override the tax figures given by the solution by going into an invoice and editing it from within the Tax Summary section.
VAT Reporting
There are two ‘out of the box’ VAT reports you can do in Sage Intacct – the VAT Detail Report and the VAT Summary Report.
The VAT Detail Report shows all transactions where VAT applies. It’s itemised by the tax detail – useful if you want to identify mis-coding in VAT.
The VAT Summary Report pulls together all your VAT totals into one report, and is good to have when you’re looking to reconcile back to General Ledger control accounts.
You can find both of these reports in Intacct by going to Reports > Custom Reports.
When you click Run on either of the reports, two radio buttons will let you choose whether you want the output as Detailed or as a Summary.
Partial Exemptions
To set up Partial Exemption, go to Company > Entities > Choose Your UK Solution > Edit.
Scroll down to the Partial Exemption section. Tick the box labelled Enable Partial Exemption.
In the drop down underneath that, select your unrecoverable tax account and write in the effective date.
Once you’ve saved these changes, you should see the Partially Exempt box ticked on relevant items, and should also see it reflected in the figures.
VAT Submissions
Step 1: Prepare & Transmit Source Tax Data
In Intacct, go to Company > Taxes > All > Tax Submissions.
Then, in the corner of the screen, click New Tax Submission.
On the next screen, fill in the relevant details before clicking the Prepare Tax Data button.
Intacct will ask you to specify an email address that will be notified once the tax return is complete.
Step 2: Creating Your Tax Return
After entering the credentials, select Open Obligation Period & Create Tax Return. Intacct will then create a tax return, emailing it to the address you specified earlier.
The system will also notify you if there are any late transactions from the last tax period that you need to add.
Step 3: Submitting to the Government
Once you’re happy with the submitted figures, export the reports (and adjust them if needed). You can then submit your VAT return to the government.
You can also make manual adjustments, including to journal entries and VAT liability journal entries.
Posting the VAT Journal
When posting a VAT journal, your postings will be:
- Debit Sales Control
- Credit VAT Liability
- Credit Purchase Ledger Control
- Debit VAT Liability
In the webinar recording, we mentioned an Excel document that we would make available to you to help you with VAT reporting and submissions. Please find it below!
In addition to the above resource, we also have a video guide available, so please reach out to one of our consultants if you would like this.
Other Frequently Asked Questions
Can I do group VAT submissions in Sage Intacct?
Yes! If multiple entities have the same tax code, they will fall under the same submission. If not, you will need to combine them manually.
How long does it take to build a custom tax solution?
Though this does depend on the specifics of the project, usually it takes around 2-4 weeks including testing time.
What happens if I move to Intacct in the middle of a VAT period?
Manual adjustments are your friend here! So for example, if you were doing a quarterly VAT submission and you moved to Intacct after your first VAT period for a quarter has passed, you would do your VAT submission as usual, adjusting afterwards to add in previous figures from your legacy system. You can also include notes or screenshots to help with auditing.
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