Record VAT reimbursement to impact accrued accounts and bank without affecting VAT reports on prior period

 

Scenario:

1.    Sales is charged with VAT

2.    Government automatically deducts VAT on Sales from bank account. This is recorded in the account as Debit to VAT Sales/Expenses and Credit to Bank Account.

3.    Government issue VAT reimbursement through wire transfer.

 

There is currently no feature to record reimbursement credit or checks from tax vendor agencies. Users may choose from below alternatives:

 

 

1. Record the refund as vendor credit and apply it on future vat payments.  

2. Create a journal entry to reverse the impact of the transaction record that was posted to record payment of accruals accounts.