Which Nominal Codes Populate the VAT Return

This guide explains which nominal codes are used by the system when generating your VAT return, and how each code is populated through your daily transactions.

Why This Matters

Understanding which nominals feed into your VAT return helps you trace VAT figures back to their source transactions. It also helps identify where incorrect VAT entries might come from when reconciling your accounts.

VAT Control Nominals Used

The system uses three key VAT control nominals when processing transactions:

0.0.70.3 – VAT on Sales (Outputs)

• Used for VAT on sales transactions.

• Populated when you raise sales invoices for:

  • Parts

  • Jobs

  • Vehicles

• This code represents output VAT – the VAT you charge customers when you sell goods or services.

0.0.60.4 – VAT on Purchases (Inputs)

• Used for VAT on purchases.

• Populated when you:

  • Purchase vehicles, or

  • Post purchase invoices for expenses, stock, or supplier goods.

• This code represents input VAT – the VAT you pay on goods and services purchased for the business.

0.0.70.91 – VAT on Deposits

• Used as a holding account for VAT on deposits received.

• Populated when you take a deposit receipt.

• When the final invoice for that deposit is raised, the system automatically:

  • Reverses the VAT out of this nominal, and

  • Transfers it to 0.0.70.3 (VAT on Sales).

How These Codes Affect the VAT Return

Your VAT return totals are built primarily from the following nominals:

• 0.0.70.3 – VAT on sales (output VAT)

• 0.0.60.4 – VAT on purchases (input VAT)

These figures combine to form your full VAT report.

• Output VAT (Sales) is the VAT you’ve collected from customers.

• Input VAT (Purchases) is the VAT you’ve paid to suppliers.

The difference between the two determines whether you owe VAT to HMRC or are due a refund.

Example

Summary

• 0.0.70.3 – VAT on Sales (Outputs)

• 0.0.60.4 – VAT on Purchases (Inputs)

• 0.0.70.91 – VAT on Deposits (Holding Account)

These accounts work together to ensure accurate VAT reporting and reconciliation within your system.