Irish VAT3 return - anyone using Manager to generate info?

Any one here using manager to gather data for the VAT3 return used in Ireland?

The VAT3 Return requires the value of purchases to be split by purchases for resale and other purchases

Just looking for advice


I believe you are misunderstanding the law or the operation of Manager, or both.

When I look at the VAT3 form, it is a very standard VAT return, on which input VAT (paid on purchases) is offset against output VAT (collected on sales). The difference is either paid to the tax authority or received from the authority, depending on which category is greater.

Manager posts all tax amounts to Tax payable, a liability account. When the balance of Tax payable is positive, you owe the authority. When it is negative, the authority owes you. The summary of purchases and sales and associated taxes is contained in the Tax Summary under Reports.

I find no requirement to separate purchases made for resale and purchases for other purposes. If an item is resold, you will collect VAT on it that is offset against the VAT you paid when you purchased it. If you do not resell it, there will be no offset.

There have not been any comments on this forum from other Irish users having any difficulty with Manager’s tax scheme. And many businesses throughout the EU use Manager successfully to calculate taxes.

I recommend creating a test company to enter some sample transactions with appropriate Irish tax codes. If you have specific questions, please ask, illustrating them with screen shots. Also read the Guides having to do with tax codes.

Sorry, I should have been more precise. I was just wondering how others went about getting their VAT return data and was wondering whether I had over-complicated my use of the system or not.

I have tried to explain below but my figures aren’t of great help because our financial year runs from Mar to Feb and the tax return is Jan to Dec. I haven’t entered data for Jan/Feb 2017 so figures don’t quite work as they should.

I have created the following 4 tax codes

which provides me with the following Tax report

This provides the information to file the VAT3 return (which is simple, as you pointed out) where
T1 is the VAT collected, T2 is the VAT paid and T3/T4 are the VAT due or VAT refund


But you also have to fill in the Trading Details return with details of the sales and purchases (sorry it isn’t very clear). In essence, the net sales and purchases are listed by rate (4.8, 9 & 13.5, 23 and 5.4%) and by sales, purchases from EU, purchases for resale and other purchases

You did not specify, but it looks like at least your last two tax codes are custom codes. You should be using the built-in Irish tax codes. Manager will automatically understand whether the tax applies to a sale or purchase and report it accordingly on the Tax Summary. You should not be using different tax codes for sales and purchases.

You can fix this by installing the proper built-in tax codes. Then revisit every transaction where you used a custom code and change it. (The invoices, receipts, payments, and such will not change because the percentages will be the same.) After the transactions are corrected, you will be able to delete the custom tax codes you created. Then your Tax Summary should be correct.

Now, it may be that the program needs addition Irish tax codes to account for EU versus non-EU sales. Look, for example, at all the Netherlands codes in the list when creating a new tax code. But that is a separate issue. If these are needed, please provide a link to official documentation about them. The developer is committed to having built-in codes for VAT systems around the world rather than having users generate their own custom codes. New codes are constantly being added, and it happens quickly.

OK, i’ll try that.

But I don’t see that will enable the Tax summary to distinguish between purchases for resale, taxed at 23%, from other purchases, also taxed at 23%.

The overall amount owed will be correct but I will need a further report to get extract the information on the split of the purchases between resale and other. The value of Goods for Resale will do, I suppose.

I do not want to use the inventory model as it isn’t appropriate.

This might be the root of your confusion. If you are buying goods for resale, that is the very definition of inventory. The Inventory Value Movement report would give you the figure you need for your VAT Return of Trading Details form. If you aren’t going to use the inventory management features built into Manager, you cannot expect it to provide information about inventory management. There are other ways to account for inventory, but you’re on your own then for reports.

You are right - but our sales come from Bar sales in a club and are less than € 1,500 pa with the cost of sales being around € 750 whereas our overall income is around € 35,000 from subscriptions and space rentals.

We do not have the technology to keep track of the sales of individual glasses of beer, wine and spirits and to deduct these from our inventory of cases of beer and wine or bottles of spirits so I guess I’ll continue experimenting with testing different methods to see what works best for us.

Otherwise I am extremely happy with the software, or at least, the desktop version as it mets our needs almost 100%

So keep track of inventory outside of Manager, such as by visual counts. Post your purchases of alcoholic beverages to a dedicated expense account. That account’s balance will give you the number you need for the trading details form. As long as you are complying with local regulations (including beverage licensing and reporting requirements), which I do not know, you will be fine. From an accounting perspective, you would be treating the alcohol as consumable supplies.

You don’t need to keep track of individual drinks to use the inventory system. When you purchase the drinks put then into inventory.

At the end of each period (month / quarter) print off the inventory on hand report and also record on that report a stocktake count of the unopened drinks.

The variation between the report and the stocktake is then entered via a zero value Sales Invoice, that is, you list the inventory items to be adjust with the quantity but with no money values. This will transfer the inventory from on hand to cost of goods sold.

Now all your required tax calculations should work correctly when using the in-built tax codes.

Very clever - hadn’t thought of that. I will give it a try in a test business to see how that works in real life and check the reporting results.

Looks good, though

Thanks Tut and Brucanna

I tried Brucanna’s idea and while it worked I think I’ll stay with Tut’s for now, which is what we were doing, anyway.

It meets our requirement for now and requires a little less effort at the cost of less information about our sales and stocks.