VAT Changes for Hospitality, accommodation and attractions
To help businesses in the hospitality, holiday accommodation and attractions sectors, the Chancellor has temporary reduced rate of VAT to 5% from the 15 July 2020
In Sage 50 Accounts you can edit and add tax codes in the software. You can create a new tax code to represent the temporary 5% VAT rate, making it easier to identify transactions you have entered during this temporary reduced VAT rate period for reconciliation and analysis purposes.
Create a new tax code
You can use a new tax for transactions that qualify for the reduced VAT rate. Sage recommends using T15, if T15 is already in use, use the next available code.
- On the menu bar (top of screen), click Settings, then click Configuration then click Tax Codes.
- Select tax code T15 or the next used available code and click Edit.
- Complete the Edit tax code window as follows:
Rate : Enter the required percentage – 5%
Include on VAT Return : To ensure the transactions are picked up by the VAT return, select this check box.
Reverse Charge : Leave as “No”
EC Code settings : Leave the check box unticked
Description : Enter this description: Temporary Reduced VAT Rate.
- Click OK, then click Apply.
- Click Close, then if prompted to Save the changes, click No.
Your new tax code is now ready to use from 15th July.
Remember there are various parts of your program which will need to be updated.
- Recurring entries – Invoices and Credits
- Recurring entries – Bank transactions
- Memorised batch invoices and credits
- Memorised bank payments and receipts
- Outstanding Orders and Invoices
- Customer, Supplier and Product Records
You will need to processes items up to the 14th July before applying the changes.
If you would like help creating a new tax code or amending any other part of your Sage or need any other help etc. or would like a quote or to purchase an upgrade please contact us