XERO Accounting Ebay Sales Paypal Monthly Summary and VAT Threshold

[mjkelly]

Hi, I have a few questions which i would be grateful for any help with.

My first question does the VAT threshold include refunds. So for example if I was to make £83,000 in sales but made £10000 in refunds, would I be required to register for VAT yet? as my actual sales would only be £73,000 or is it simply based on the sales with no regards for the refunds?

My second questions is i am trying to enter a monthly summary in to XERO for my eBay sales. I am doing this as I read it would be easier than importing every individual transaction from PayPal.

Should my monthly receive money transaction in XERO for monthly sales be the total payments received before any deductions like refunds?

I was going to make the following monthly spend money transactions in XERO

PayPal Fees
Dispute Activity
Refunds Sent

and the following receive money transactions in XERO

eBay Sales

 

[Clare@ClarityTaxation]

The VAT threshold is net of refunds. Be careful though as the limits are based on a rolling 12 months, not your financial year: https://www.gov.uk/vat-registration/calculate-turnover

As far as Xero goes I would put in all sales and then all refunds, not just the net difference. This makes your records complete, and it will be much easier to trace any transactions.

 

[mjkelly]

Hi, sorry please could you explain what you mean by "net of refunds" when you say the VAT threshold is net of refunds.

Do you mean the VAT threshold is total sales before or after the refunds have been deducted?

Thankyou

 

[Scalloway]

Do you mean the VAT threshold is total sales before or after the refunds have been deducted?

Thankyou

After refunds are deducted.

 

[mjkelly]

Hi, thankyou for your quick reply it is much appreciated.

Should PayPal Chargebacks and disputes also be deducted from this figure?

 

[Scalloway]

I would treat those as refunds.

 

[mjkelly]

Thankyou