How to Generate the VAT Liability Report
The VAT Liability Report provides you with the data needed to know how much you owe the government in tax, making it a very useful tool for your bookkeeping and accounting needs.
Note: If you have questions beyond the information presented in this article, we advise that you talk to your accountant or CPA, or contact your government tax agency.
Access Your Report
To access the VAT Liability Report, go to your Financial Reports section, located in the company section in the left navigation, and click the View Report button next to the VAT Liability Report.
Generating Reports for Accrual or Cash Accounting
You can generate a report using either cash or accrual accounting methods.
- When using accrual accounting, the report is based on the total VAT amount of your invoices, paid, partially paid, and unpaid. This includes invoices that have been issued, marked as paid, and have been sent to clients. However, draft invoices, deleted invoices, or invoices that have been voided are not included in this report. The reference document date in the report is based on the created date.
- When using cash accounting, the report is based on invoices that have been paid or partially paid. The reference date in the report is based on the payment date.
To switch accounting methods, use the dropdown at the top of the report and select the desired method. Make sure to click Generate Report to apply the changes and update the report.
The report will display the total VAT that you owe to the government for the time period you've selected, along with a breakdown of the taxes for each tax rate that you have set up. You can also filter the report based on the dates, tax rates, and projects.
Export to Excel
You can export the report as a spreadsheet by clicking the Export Excel button on the top right.
To learn more about financial reports on Houzz Pro, see this article.
Frequently Asked Questions
1) I pay VAT to suppliers, should I deduct the prepaid VAT from the total I pay the government?
Our VAT liability report does not include prepaid VAT deductions. Most governments require you to report VAT on the full selling price to the customer, regardless of whether VAT was paid to the supplier or not. We recommend you track the VAT paid on your purchase orders in Houzz Pro. Then you can use the data to calculate your deduction when filing your tax return. However, we always advise that you talk to your accountant, CPA, or contact the relevant tax authority to see how to handle prepaid VAT and ensure you are properly reporting VAT.
2) How do I calculate the total VAT amount I have already paid to suppliers?
Run an Outgoing Transactions by Project report for the time frame you're wanting to account for, then scroll to the far right of the report where you'll find the VAT Amount column. At the bottom of the VAT Amount column you will see the total VAT amount you've paid directly to suppliers.