How VAT Return boxes calculate

Summary

Understand how each VAT Return box calculates in Sage Accounting. This helps you check why transactions appear or don't appear in your return.

Description

If your business is VAT registered in Ireland, you must submit a VAT Return to Revenue Online Service (ROS), usually every two months.

Sage Accounting calculates your VAT Return using the VAT values recorded in your transactions. The values included depend on your VAT scheme and tax rates.

If a transaction has no VAT, it doesn’t contribute to VAT totals.

Resolution

▼ Invoice basis

If you calculate VAT on an invoice basis, the VAT Return calculates from the VAT element of your:

Invoices and credit notes
Other payments and receipts made through the Banking option
Journals posted to the relevant VAT nominal codes

How the VAT Return calculates:

T1	The total VAT on sales – This includes the VAT element of: Sales invoices Sales credit notes – Credit notes deduct from the value in this box Bank, cash and visa receipts Journal debits or credits posted to the VAT on sales nominal code The VAT Return includes reverse charge VAT for standard or lower-rated services purchased from EU or non-EU suppliers.
T2	The total VAT on purchases – This includes the VAT element of: Purchase invoices Purchase credit notes – Credit notes deduct from the value in this box Bank, cash and visa payments Journal debits and credits posted to the VAT on purchases nominal code NOTE: Zero-rated purchases of goods for resale will show here too.
T3	The total amount of VAT payable. If the amount in T1 is greater than the amount in T2, the difference appears here and is payable to Revenue.
T4	The total amount of VAT that’s repayable. If the amount in T2 is greater than T1 the difference appears here, and you can reclaim from Revenue.
E1	The total value of the sale of goods to VAT registered EU customers, excluding VAT. The Net value of destination VAT sales for OSS goods.
E2	The total value of purchases of goods from VAT registered EU suppliers, excluding VAT.
ES1	The total value of the sale of services to VAT registered EU customers, excluding VAT.
ES2	The total value of purchases of services from VAT registered EU suppliers, excluding VAT.
PA1	The value of goods imported under postponed accounting.

▼ Cash basis

If you calculate VAT on a cash basis, the VAT Return calculates from the VAT element of your:

Customer receipts, refunds and any payments on account
Supplier invoices and credit notes
Other payments and receipts made through the Banking option
Journals posted to the relevant VAT nominal codes

The VAT Return calculates tax at invoice, not payment, for goods or services bought or sold to EU or non-EU VAT-registered parties.