Hello,
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I've been paying VAT on income aligned to the month I did the work. However I operate under a self billing agreement and the Invoice Date shown is after the month end that I am being paid up to.
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I've seen this situation with agency work with a payment a few days after the month end and an invoice some time after. Even though your company delivered the work in the earlier month this is not necessarily related to the invoice date. How the services are billed should be in the contract somewhere.
- In Sales enter the invoice using the invoice date as shown on the invoice
In Current Account enter the date that appear on the bank statement
In both use a common narrative (e.g. "Month X services") and invoice number.
The VAT liability will be calculated based on the month sheets used in sales and purchases.
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I have been entering the sales date in the sales spreadsheet as the month end date.
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This should really be the invoice date.
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I need the income for the last month of the co. year to be shown in the accounts to balance with the VAT (period end coincides with co. year).
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It's normal to have a year end showing some outstanding liabilities. By using the sales invoice date there will only be a VAT liability where there is also income.
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Can I include income in the accounts where the invoice date is after year end?
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You shouldn't include this in sales, but you can include a payment received from an invoice that is not yet issued. This can end up giving you a negative trade debtors balance (you owe customers money) which is messy and it used to upset HMRC's online filing validation. If the a payment did occur early and is recorded in the bank statement the only thing to do would be record it in the accounts.
Thanks,
Antony.
