1. Objective and Scope

1.1. Objective of this Operation

The VAT reporting obligations in scope for the United Kingdom are is the following:

• VAT return - Quarterly
• ESL - Monthly
• Intrastat (Arrivals and Dispatches) - Monthly
• Monthly or quarterly

The ESL and the Intrastat are described in specific procedures.
This procedure is to be used by RtR (change RtR) as the VAT team as a step-by-step guideline to report the VAT related to the operations made by Solvay entities in United Kingdom.

1.2. Scope

The entities for which RtR (change RtR) is the team is responsible for the preparation of the VAT in the United Kingdom are the following:

2. Definitions

See Finance Glossary:

• ESL - EC Sales lists which are used to collect information on all sales from UK VAT registered traders to VAT registered traders in other EU Member States
• Intrastat

3. Tasks description

3.1. Periodicity

RtR (change RtR): 'VAT return excel file' should be sent till the 10^th working date of the period through a Freshdesk ticket. 

Local Accountants will apply final validation and ensure the electronic filling and payment. Copy of the submitted VAT return will be addressed to RtR (change RtR) for archiving.

2. Tasks description

2.1. Periodicity

The deadline for submitting the return online (by MTD platform) is usually one calendar month and 7 days after the end of an accounting period. This is also the deadline for paying HMRC. You need to allow time for the payment to reach HMRC’s account.

The payment of the return can be made through MC tool (when applied) or requested to the CAM of the Company. 

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.2. I calculate the VAT return

The procedure starts by extracting the monthly or quarterly data from SAP PF1 or WP1 system. The figures will be pasted into the 'VAT return excel file'.
In the file, besides the sheet with automatic links that calculate the quarterly figures, there's a sheet with a reconciliation to be done by RtR (change RtR).

2.2.1. I extract the SAP reports

Tcode: S_ALR_87012357

Variants:

Variants for UK (0240&4265&5872) in GBP

STEP 1

OUTPUT

UK OUTPUT VAT

STEP 2

OUTPUT

UK OUTPUT EA

STEP 3

OUTPUT

UK OUTPUT EE

STEP 4

INPUT

UK INPUT VAT

STEP 5

INPUT

UK OUTPUT EQ

Variants for BE (SCI 0005) in GBP

STEP 1

OUTPUT

SCIOUTPUTVATGB

STEP 2

OUTPUT

SCIOUTPUTEAGBP

STEP 3

OUTPUT

SCIOUTPUTEEGBP

STEP 4

INPUT

SCIINPUTVATGBP

STEP 5

INPUT

SCIOUTPUTEQGBP

Variants for BE (SCI 0005) in EUR

STEP 1

OUTPUT

SCIOUTPUTVATER

STEP 2

OUTPUT

SCIOUTPUTEAEUR

STEP 3

OUTPUT

SCIOUTPUTEEEUR

STEP 4

INPUT

SCIINPUTVATEUR

STEP 5

INPUT

SCIOUTPUTEQEUR

After selecting the variant, enter the appropriate posting date to determine the reporting period.

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Example for UK: 

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2.

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Save the files with names that allow you to keep track of what they include.

2.2. I fill in VAT report file

Pick up the 'VAT return excel file' used for last quarter data at google drive folder: 2.8 C-IBUKIT. (please link to the file. Upload the file in AOdocs?)

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For UK there will be only one file. For BE there will be 2 files (one in EUR and other in GBP). Save the file updating the reporting period in its name.

Examples: (missing something?)

Each file contains several sheets. Consider the following:

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Replace in each one of the 5 'step' sheets, the data from the 5 files obtained from the 5 variants based on valid VAT Tax Codes. 
Example:

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Then go Go to sheet "VAT RETURN" and check the cells highlighted in yellow.
Make sure they are picking up the correct figures from each 'step' sheet.
The figure to pick up from each 'step' sheet is the total. 
Consider the colour coding to help you look for the right 'step' sheet. 
The colour used in the 'VAT RETUN' (return?) sheet cells is the same used to identify each 'step' sheet.

Example: the sheet "Step5" is coloured purple. Therefore its total figures, for 'Tax base amount and 'Balance', are to be reported in the lines coloured purple in the sheet "VAT return":  (missing something?)

The figures from sheet "VAT RETURN" fill in a draft for the VAT return declaration in the sheet 'Final VAT return':

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make sure that each tax code is correctly assigned to each box of the declaration (as described next to each one).

The final value of the declaration should be reflected on box 5 and reconciled with accounting.

2.2.3. I perform the VAT return

(please confirm the title)

reconciliation

2

.2.3.1. File: VAT UK

The reconciliation for UK is made in GBP; BE 0005 is made in EUR with comparison to GBP for FX rate validation.

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Update the date and the accounts balance (open items at the end of quarter).
Check if the 'Current month VAT payment' matches the figure from sheet 'Final VAT return'. 
Comes from VAT RETURN tab.

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TCode: F.01
Variant: UK VAT RETURN
Choose Special evaluation tab to select quarterly reporting period.

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Consider the accounts according to companies as follows:

PF1 Accounts for UK:

• VAT Receivablereceivable: 2411030044 
• VAT payable: 2451030044
• VAT centralization: 2451040000
• VAT centralization: 2411040000

WP1 Accounts for UK:

• VAT receivable: 44700100
• VAT payable: 44900200 

Then reconcile the accounts open balances with the ''Current month VAT payment'. Occasionally, there are items to reclaim VAT, they could be found, for example in PF1, in account 2451040044 / 2411040044 and should be included in the VAT return template as well. 

Check if manual adjustments need needs to include the following (check to be done only for UK):

• Deferred (import)- certificate VAT C79: In VAT account, 2451040000 (using SAP transaction FS10N or FBL3N – G/L display balances, with open items until the last day of current quarter); filter the document type G2 and check if the documents have PDF documents attached; report the amounts retrieved from G2 documents only if they have PDF documents attached (on Excel file VAT template for UK) in cell I24 of the tab "VAT return";
• Reclaimable VAT on bad debts (very rare); 
• VAT reclaimed on pension scheme payments; in Vat account 2451040000 for document type M1 or R1 with text "Mercer VAT rec"; include the total amount (on Excel file VAT template for UK) in cell J24 of the tab "VAT return"; cell J36 will be automatically computed. ;
• CO2 Car emissions (for 7771).

Tip: To find the outstanding items do clear the difference: look in the accounts' open items:

• TCode: FBL3N
  
  • Account: 2451040000
  • Check for: Doc type: M1 – pension fund payments; G1 – Duty Refund, and all Assignments DEFER VAT etc.
  • This items will combine as manual adjustment that should be included in VAT return and VAT reconciliation. 

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2.2.3.2. VAT UK

0005 GBP

Accounts for BE0005:

• VAT centralization GB: 2451040044 
• VAT centralization GB: 2411040044 

Please, follow reconciliation instruction tab to process data validation. 
Reconciliation of BE on file - VAT UK BE 0005 GBP - will represent last quarterly amount to be paid to authorities, based on advance monthly payments made (n/a in 2022, but to checked year by year) in this period . 

Tip: In case of struggle to find the 'outstanding items', go see past reconciliations for ideas and patterns. 

2.3. I

submit the VAT return

The submission of the VAT return is made as previously mentioned through MTD platform.

Although in order to retrieve the pdf of the declaration, you need to access the HMRC website (view my submitted returns).

2.4. I send data to CAM's ("gift box")

The files should be sent to the CAM via email. 

2.5

The files should now be sent to the Local Accountants thought (through?) a Freshdesk for review. 
The ESL figures should be sent in the same email, please follow 'OP ESL United Kingdom' (remove OP?) in order to obtain the ESL files. 
Follow up with the local contact person to confirm the package receipt. 
Request a copy of the submitted VAT return for archiving, as well the ESL declaration. 
Till you receive these documents it is advised not to close the case but to pending.

Examples: 

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. I upload the files in google drive

When the VAT and the ESL declarations of submission are receivedsubmitted, make the upload into designated location for archiving in google drive (VAT SU google drive). (link to the location?)

End of document.