Vintro Pro
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Vintro Pro
NL · FR · EN
No law in the UK tells you how to number your accounts: your accounting package picks the range. Here is how to give margin-scheme sales a sales account of their own, and what HMRC expects alongside it.
The short answer: on a sales account of its own, numbered from your package’s range.
The UK has no statutory chart of accounts like Belgium’s MAR or France’s PCG. The Companies Act 2006 only asks for “adequate accounting records”, enough to show and explain the company’s transactions (s.386). The numbers your accounts carry are set by your accounting package.
A separate sales account for the margin scheme is therefore not required, but it helps. HMRC wants the margin per item in your stockbook and these sales shown separately on your VAT return. On an account of their own, you find them at a glance.
sales in the 4000s; for the margin scheme, a free code such as 4010
up to ten characters, like “200” or “SALES”; pick a free code next to your standard sales
account numbers are off by default; switch them on under Account and settings, Advanced, Chart of accounts
Always check your own chart of accounts first to see which code is free. The codes on the cards are examples.
VAT Notice 718 no longer exists: HMRC withdrew it on 23 December 2021. The rules are now in the VAT margin schemes guide on GOV.UK.
One-sixth (16.67%) of the difference between selling and buying price. HMRC’s example: bought for £1,500, sold for £2,000, VAT £83.33. (Overview)
Stock number, purchase and sale dates, invoice numbers, prices, seller and buyer, description, margin and VAT due. Keep for six years. (Keeping records)
Total price with no separate VAT, the stock number, and wording such as “margin scheme - second hand goods”. (Keeping records)
Box 1: the VAT on the margin. Box 6: the full selling price less that VAT. Box 7: the full purchase price. (VAT return)
HMRC’s example: bought for £1,500, sold for £2,000
Box 1
£83.33 the VAT on the margin: one-sixth of £500.Box 6
£1,916.67 the full selling price less that VAT.Box 7
£1,500 the full purchase price.Add a sales account of its own to your chart of accounts, such as “Sales – margin scheme”, with a free code. Note that Xero has no tax rate of its own for the margin scheme: the list of tax types in Xero’s API contains none. Agree with your accountant how the margin VAT is then posted.
In Vintro Pro you enter that account code and tax rate once under Company settings → Connections and accounting, under Margin scheme. Every draft invoice Vintro Pro creates in Xero then uses them.
From Xero to your invoice
In Xero
A sales account of its own Such as “Sales – margin scheme”, with a free code.With your accountant
The tax rate Xero has none for the margin scheme. Agree how it is posted.In Vintro Pro
Enter it once Under Margin scheme. Every draft invoice in Xero then uses them.below that you choose, such as 700200
the RGS is a voluntary standard
sub-accounts allowed, such as 7071
Sage, Xero and QuickBooks each number their own way
This is an explanation, not accounting advice. Run your own chart of accounts past your accountant.
No. The Companies Act 2006 (s.386) requires adequate accounting records but prescribes no account numbers. Each accounting package uses its own range.
Sage puts sales in the 4000 to 4999 range. Xero lets you pick a free code of up to ten characters, such as 200. QuickBooks works with account names; account numbers are off by default.
One-sixth of your margin, 16.67%: the difference between selling and buying price, for standard-rated goods. Bought for £1,500 and sold for £2,000, that is £83.33.
Among other things the item’s stockbook number, the total price with no separate VAT, and wording such as ‘margin scheme - second hand goods’ or ‘margin scheme - collectors’ items and antiques’.
No. HMRC withdrew it on 23 December 2021. The rules are now in the ‘VAT margin schemes’ guide on GOV.UK.
Vintro Pro creates the draft invoice straight in Xero, using the account code and tax rate you enter once for standard sales, margin-scheme sales and exports. With Sage or QuickBooks you download your invoices as a CSV file.
30 days free, no card number.