By using the accounting data from your forecast, we’ll estimate your upcoming VAT payments. If you make a change to the forecast, it will automatically update that transaction.

To be able to predict VAT in Fluidly, you’ll need to be:

  • On an Accrual (Xero), Standard (QuickBooks) or Cash VAT scheme

  • Paying VAT quarterly

  • Recording VAT payments on the default accounts 820 or 2202 if you’re using Xero

How does Fluidly automatically calculate VAT estimates?

We use a combination of:

  • The Balance Sheet liability: any invoices or bills in that period

  • Predicted transactions: any regular and one-off transactions or monthly total adjustments

Our analysis also depends on where you are in your VAT period. Here’s three scenarios:

1. VAT period has ended and a payment is due: We use the Balance Sheet liability only

2. You’re in the middle of a VAT period: We use the Balance Sheet liability for the quarter so far and any remaining predicted transactions

3. The VAT period is in the future: We use predicted transactions only

To make sure we don’t calculate VAT unnecessarily for any predicted transactions (e.g. payroll), we look at how VAT is applied to an account line:

  • Xero users: Predicted transactions will use the default tax rate on that account line

  • QuickBooks users: Predicted transactions will use the average VAT that’s been applied to previous transactions on that line

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