The VAT return is calculated based on:
- the VAT information you’ve added to your income and expense transactions in Bookkeeping
- if you’re in Great Britain (GB) or Northern Ireland (NI)
- any VAT adjustments you have made
- and the information in your VAT settings (including the VAT scheme you’re on).
Taking this into account, we calculate the boxes on your tax return, as explained below:
- Box 1 – VAT due on all income transactions and other outputs (which includes reverse charge VAT, and postponed VAT accounting).
- Box 2 – VAT due on acquisitions from the EU (NI only)
- Box 3 – the total VAT due (i.e. the sum of boxes 1 and 2).
- Box 4 – the VAT reclaimed on expense transactions and other inputs (including acquisitions from the EU, reverse charge VAT, Import VAT and Postponed VAT). It can include any input VAT on an expense transaction that you’ve identified as recoverable VAT or through cross border VAT reporting.
- Box 5 – the net VAT to be paid to HMRC or reclaimed by you from HMRC (i.e. the difference between boxes 3 and 4).
- Box 6 – the total value of net income (i.e. total sales and all other outputs), excluding any VAT.
- Box 7 – the total value of expense transactions and all other inputs, excluding any VAT.
- Box 8 – the total value of all supplies of goods and related costs, excluding any VAT to the EU. (NI only)
- Box 9 – the total value of acquisitions of goods and related costs, excluding any VAT from the EU. (NI only)