Hi Everyone
I work for a limited company and early last year we sought permission from the Revenue to start working on a cash receipts basis, permission was granted and cashflow improved for about 2 vat periods, then it was back to normal which our accountant told us to expect....but in the last few months our turnover has increased slightly and will probably come in above the €1m threshold, if only slightly, so again we've notified the revenue of our intention to change back to Invoice Basis. Still waiting to hear back.
My question is....how do i calculate the difference? Will there be invoices im missing out paying the vat on? For example: If we've used CR basis up until 1st April 2011, then changed over to Inv Basis from 1st May....ive obviously paid the vat on all lodgements up to 1st April but not on all invoices issued up to 1st April? Im working on Sage so will it do the calculations automatically? Is it as simple as calculating the vat on both CR and Inv Basis over a period of time and seeing what the difference is? Ive done this already and theres actually very little difference at all, in fact we seem to have overpaid by about 500euro, could that be possible? Just to note: we've now started buying smaller quantities of stock from Irish suppliers to improve cash flow, whereas before we would have bought container quantities from Denmark/UK etc so our vat on purchases have dramatically increased also!
Sorry for the long post!! Hope someone can clarify!
I work for a limited company and early last year we sought permission from the Revenue to start working on a cash receipts basis, permission was granted and cashflow improved for about 2 vat periods, then it was back to normal which our accountant told us to expect....but in the last few months our turnover has increased slightly and will probably come in above the €1m threshold, if only slightly, so again we've notified the revenue of our intention to change back to Invoice Basis. Still waiting to hear back.
My question is....how do i calculate the difference? Will there be invoices im missing out paying the vat on? For example: If we've used CR basis up until 1st April 2011, then changed over to Inv Basis from 1st May....ive obviously paid the vat on all lodgements up to 1st April but not on all invoices issued up to 1st April? Im working on Sage so will it do the calculations automatically? Is it as simple as calculating the vat on both CR and Inv Basis over a period of time and seeing what the difference is? Ive done this already and theres actually very little difference at all, in fact we seem to have overpaid by about 500euro, could that be possible? Just to note: we've now started buying smaller quantities of stock from Irish suppliers to improve cash flow, whereas before we would have bought container quantities from Denmark/UK etc so our vat on purchases have dramatically increased also!
Sorry for the long post!! Hope someone can clarify!