VAT Group Reporting Receives an Upgrade

VAT group reporting from Business Central used to require manual calculations and consolidation. Fortunately, Microsoft have now introduced functionality into Business Central to automate group submissions.

VAT Group Management setup

VAT Groups are commonly used amongst mid-size businesses. They are formed of individual companies with a single VAT registration number. A single VAT return is made which consolidates the VAT liabilities for all the relevant companies. From the perspective of VAT reporting, tax authorities treat a VAT group as one company. Up until now, group VAT reporting in Business Central or NAV required manual intervention to consolidate the figures into a single group return. Fortunately, Microsoft have amended this, making the process far simpler.

What has changed?

With the 2020 release wave 2 of Dynamics 365 Business Central, VAT groups have received support, making reporting straightforward and seamless. The new feature uses inter-group communication to consolidate VAT data. Regardless of whether the companies are in Business Central online or on-premise, they are supported. To make it even easier, there is Assisted Setup to make the setup as simple as possible. You can designate one of the companies as the group representative whilst the other companies prepare their VAT returns in the normal way in Business Central. The only difference is that they then submit the return to the group representative, not HMRC.

Once all the submissions have been received in the group representative company, they can be reviewed on the VAT Group Submissions page. After the usual manual sanity checks, the combined submission can be transmitted to HMRC.

Make sure to see the full list of the changes made in Business Central’s release wave 2 of 2020. Don’t hesitate to put forward any recommendations for other changes you would like to see in Business Central and we will voice these across to Microsoft. Before you go, why not take a look at our other blogs?