Creating a VAT summary: how to prepare your return more quickly

Preparing your VAT return using separate PDFs, Excel files and a calculator takes up an unnecessary amount of time. Creating a proper VAT overview doesn’t start at the end of the quarter, but the moment you draw up an invoice.

Record your VAT for each invoice line and keep all invoices in one place. Then, at the end of the period, select a summary, check for any exceptions and submit it. A VAT summary serves as the supporting documentation for your return, not the return itself.

What do you need to create a VAT summary?

To create a usable summary, you’ll need all the invoices sent during the relevant period. For each invoice, it must be clear which VAT rate applies to which line item. This is particularly important if you have line items with different rates on a single invoice.

Therefore, ensure your records include the following details for each invoice line:

• the invoice date;
• the amount excluding VAT;
• the applicable VAT rate;
• the VAT amount;
• any corrections via a credit note.

Don’t choose the VAT rate on a whim. Whether a particular rate can be used is a tax assessment that you or your accountant must make. Your accounting system must then correctly apply the rate you select for each line item.

If you work with invoices in Klantly, you can select the VAT rate for each line item. The totals are broken down by rate. This saves you from having to add them up manually and makes it much easier to keep your invoices organised.

How do you choose the right period for your VAT return?

Always start with the period for which you’re filing your return, for example a quarter. Then filter your invoices by that period. This prevents an invoice from the previous or next return from being accidentally included.

Don’t just look at invoices you still need to send or that are saved as draughts. A draught does not yet belong in a final statement. So check carefully which status you’re including and make sure you’re working with the invoices that have actually been sent.

A set procedure helps:

1. First, select the tax return period.
2. Open the overview of turnover and VAT by rate.
3. Check for unusual amounts and invoices with multiple rates.
4. Then look at credit notes separately.
5. Export the overview for your own records or for your accountant.

This way, you don’t have to review every invoice again. You only check what stands out or differs.

Why do you need to check credit notes separately?

A credit note corrects an invoice that has already been sent. Examples include a delivery that was partially cancelled, incorrectly invoiced materials or an agreed correction. Rather than quietly amending the old invoice, you issue a credit note that refers back to the original invoice.

For your VAT return, the date of the credit note is particularly important. A credit note is deducted in the period in which you issued it. As a result, a correction to an old invoice may end up in a later quarter.

You should therefore always check, before exporting your data, that all credit notes in the selected period make sense. An unexpectedly high or low total is often not due to a calculation error, but to a correction you had lost track of.

Example: an installer with labour and materials on a single invoice

Suppose you complete a job in June and send an invoice with separate lines for labour, materials and an additional part. For each line, you select the VAT rate that applies to your situation. Your accounts then add up the turnover and VAT for each rate.

In July, it transpires that a component does not need to be supplied. You issue a credit note for this. That credit note no longer belongs to your VAT summary for April to June, but to the summary for the period in which you send the credit note.

At the end of the quarter, you won’t need to go through all the invoices again. You simply select the period, view the turnover per VAT rate, check the July credit note in the next statement and export the data. This allows your accountant to see how the turnover is broken down, without first having to go through a pile of documents.

How do you export a VAT overview for your accountant?

An export is useful if your accountant is filing the return or if you want to carry out a check yourself first. Select the period, check the amounts and then export the summary to send on or save.

In Klantly, the VAT summary shows turnover and VAT by rate, including credit notes. You can export the summary by period. This gives you clear supporting evidence for your sales invoices, rather than a folder full of loose documents.

That doesn’t mean your accountant no longer has anything to do. Your VAT return covers more than just sales invoices. Purchase invoices, other items and the final tax assessment are also part of it. The summary therefore helps you to prepare the turnover side properly.

If you want to spend less time searching, start by designating a fixed location for invoices and rates. See how invoices and VAT summaries in Klantly can help you structure your accounts.

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