How your VAT return is calculated

Every figure on your VAT return comes from records you keep in Kontala. There is nothing to calculate by hand - the return is worked out for you, and you can trace every number back to its source.

What feeds the return

• Invoices you raise add VAT on sales and your net sales figures.
• Bills and expenses add the VAT you can reclaim and your net purchases.
• Explained bank transactions count too - money in on the sales side, money out on the purchases side. See Explain a transaction.

Imported bank transactions you have not explained yet are not in the return. Items marked out of scope are left out entirely, and exempt items count towards the net totals without any VAT. Credit notes and refunds reduce the totals rather than adding to them.

Your accounting basis

Your VAT Accounting Basis in VAT Registration decides when things count:

• Invoice - invoices and bills count from their document date.
• Cash - invoices and bills count when they are actually paid, and a part payment counts a proportional share.

When figures update

The return recalculates every time you open it, so a correction to an invoice, bill, expense, or bank explanation flows straight through. Figures keep moving until you file - after that, the return is a frozen snapshot and the period locks.

To see what each box means, read VAT boxes explained, then review your return before filing.