How to account for incoming VAT from my life before Bullet

Account for incoming VAT – Free Online Small Business Accounting Software Questions & Answers

I have a problem and I’m hoping someone can help.
Like many small businesses I am allowed to pay VAT in the period it was received as opposed to when the sale took place. This covers my 60+ days credit that I work to.
So, I started using Bullet in January 2015. I’m going to use example figures to highlight what I mean.
In the period Jan/Feb 2015 I took in €200 in VAT from Jan/Feb sales and spent €300 in VAT in purchases for the same period. So Bullet thinks I have a €100 repayment due to me from Revenue.
But, in the period Jan/Feb 2015 I received €1000 in VAT from sales that occurred in 2014, but where payments for those sales were made in 2015. These payments were deposited into my ‘main’ business account. At the end of the tax period I moved the relevant amount into my ‘tax’ account.
So, my actual return to revenue was €900, which I paid from my ‘tax’ account. The transaction has now appeared on my bank statement and Bullet is asking what this is for, as it doesn’t match the €100 refund it was expecting.
I cannot figure out how to let Bullet know about this.
I had previously setup new (chart of account) accounts to handle incoming payments and liabilities from 2014, but can’t figure out a way to handle this problem as the account reconciliation function wont allow me take something from each side of the balance sheet to make a figure that matches the payment.
Please help Bullet community!

2 answers

Peter Connor Staff April 1, 2015

Hi Finn,
I’ll get back to you on this tomorrow.
The best advice would be to leave the chart of accounts alone. Use a bank account for company and personal. Bullet gets connected to the business account and then you wont have these rec issues. Use Bullet to tell you want tax you owe from that account, and the rest can be used for everything else. 
I’ll be back tomorrow. 

john_bullet Staff April 3, 2015

Bullet expects all VAT-able items to be recorded as Invoices and Bills in the system.  Our advice to people moving to Bullet is to enter the invoices they have which are currently outstanding and record them in Bullet.  When you then receive the payments, we have invoices to record the payments against.
Bullet won’t look at manual journal entries for information relating to VAT, as there isn’t enough details in the journal entries (tax rates, location of client/supplier etc), so we’d recommend you use Invoices and Bills to track the VAT thats you owe/is owed to you.
Let us know if you’d like any additional information on this Finn.


Please login or Register to Submit Answer