When does VAT go in the cash book?
The cash book has a VAT column, but only for sales and purchases that never went through a day book. Learn which entries use it.
This path is practice in how the records and the sums work. It is not tax advice. Any rate or allowance in a question is an example for that question, so check GOV.UK for the current figures.
Task 1Receipts3 questions
An analysed cash book has a VAT column. It is used only when the cash book is the first place a sale or a purchase is recorded.
- A cash sale over the counter: split it into net and VAT in the cash book
- A receipt from a credit customer: nothing in the VAT column, because the VAT was recorded when the invoice went into the sales day book
| Details | Bank | VAT | Cash sales | Trade receivables |
|---|---|---|---|---|
| Till takings, all at 20% | 1,080.00 | 180.00 | 900.00 | |
| Hopscotch Play Café | 426.00 | 426.00 |
Putting VAT in the cash book for a credit customer's payment would count the same VAT twice.
Task 2Payments4 questions
Task 3Posting the VAT columns2 questions