In advance of VAT registration, the system can be set up to display VAT breakdowns of any fees taken or revenue calculated based on the users' client account.
1. Becoming VAT registered
When a business becomes VAT registered, the system must be updated with the VAT registration details, including the VAT registration number, VAT registration date, and VAT rate.
To add this information to the system, a super user should complete the following steps:
Go to Admin > View all employees
Click the Admin page in the top right side
Select Account
Fill in the VAT number and the VAT rate sections
The VAT rate should be set at 20, see below
Click Update at the bottom of the page
Please contact the Financial Support Team ([email protected]) before becoming VAT registered and provide the VAT registration date. If management fees are VAT exclusive, please include this information when notifying the Financial Support Team so the management fees can be updated accordingly.
Examples:
If the management fee is currently 12% inclusive of VAT, it will appear as 10% + VAT, which results in a total charge of 12%.
If the management fee is currently 12% exclusive of VAT, it should be updated to 12% + VAT, which results in a total charge of 14.4% (12% + VAT).
2. General guidance
SME Professional would advise users to complete the following steps before becoming VAT registered:
2.1 Statements
Once VAT registered, the system will be updated to show VAT where applicable. Any future statements generated for periods before VAT registration will also show VAT on fee deductions.
As a result of this, it is recommended that users process statements and payments for all owners before going VAT registered, for payments where VAT does not apply.
For example, a user becomes VAT registered on the 1st of October. The user will generate custom annual summary statements for all landlords for a date range up to the 1st of October.
This is recommended as we cannot guarantee that VAT settings can be temporarily changed to regenerate individual landlord statements without VAT after registration has been completed.
2.2 Profits
Please ensure that any profits are transferred before VAT registration and generate the necessary reports. This will ensure that this change will only apply to future fees.