Why Am I Showing VAT on a Purchase When the Stock Has Been Cancelled?

This issue may arise due to how the vehicle cost was reversed. Specifically:

• If the original cost was posted with VAT but the reversal did not include the VAT element, the system might show that the VAT has not been properly reversed.

How to Correct This Issue

1. Post a Journal Entry:

   • Clear the difference by transferring the balance from the VAT account to the vehicle stock account.

2. Verify the Balances:

   • Run a transaction report filtered by stock number.
   • Sort the report by nominal codes to identify discrepancies and ensure the reversal aligns with the original posting.

Key Considerations

• Always ensure that both the cost and VAT elements are reversed simultaneously to prevent such issues in the future.
• Use the transaction report as a reconciliation tool to confirm all entries are balanced and accurately reflect the stock cancellation.