Bookkeeping & VAT (2024)

Now in 2024, I am still wrestling with how to effectively incorporate VAT in a spreadsheet bookkeeping system. This article is based on two Dutch single-owned (ZZP) administrations that I maintain:

An IT/marketing service company. Customers are located in NL (always 21%), suppliers worldwide
An art production company. Customers in NL (21%) and mostly outside EU (0% VAT). Hardly any suppliers.

VAT submission is more than only bookkeeping accounts

Maybe useful as a start: For VAT submissions, I need more data than just straighforward bookkeeping-related information.

Examples:

Export to countries outside the EU: That's a subset of revenue
Sales to countries within the EU: Again, a subset of revenue
On the opening and closing balance, I need to incorporate those figures from the previous year.

Don't use same names as on VAT submissions

Maybe kinda weird remark, but I fing it quite messy to use the exact same wording as what the Belastingdienst uses on their VAT submission webforms.

Review: VAT submission

It's the VAT submission at the Belastingdienst website, where everything comes together. So let's review what's needed there:

Page 2: Domestic achievements

Information needed at VAT submission - Page 2: Domestic
Category	Field	Name & Description	Consequences concerning bookkeeping
1 - Domestic achievements	1a	Domestic revenue - High Domestic revenue (without VAT) charged at high VAT rate and corresponding VAT amount. There is no distinction between services and products here	Initially, this is simply the sum of the bookkeeping fields Revenue – NL - High over the designated period This becomes more complex if corrections on errors from earlier periods, need to be corrected - This will come later Account VAT Due - High
1 - Domestic achievements	1b	Domestic revenue - Low As 1a, but now when the lower VAT rate is applied, e.g., for sales of original art work (which has never happened so far) → Not relevant	Not relevant
1 - Domestic achievements	1c	Domestic revenue - Other	Not relevant
1 - Domestic achievements	1d	Private use	Not relevant
1 - Domestic achievements	1e	Domestic revenue - 0% or similar	Not relevant
2 - Reverse domestic VAT	2a	Reverse domestic VAT	Not relevant

Page 3: Abroad

Information needed at VAT submission - Page 3: Abroad
Category	Field	Name & Description	Consequences concerning bookkeeping
3 - Achievements abroad	3a	Products exported outside EU This is quite a strange entity, and actually not business economy-related. Appearantly, Belastingdienst just wants to know for what amount products have been exported to other EU countries. It's only about products, not services. Also, no VAT amount is asked for (export outside EU is always free of VAT) Here, products mean physical products. This can be deduced from following this wizard, which has several questions about how the goods are transported, and where the goods at the moment of sales. 'Somewhere in the cloud' isn't an option This is not relevant. I thought it was relevant for the art business, but it isn't: It never involves physical goods	Not relevant
3 - Achievements abroad	3b	Products/services exported inside EU Both products and services delivered to customers inside the EU (but outside NL). The VAT amount isn't asked for here The actual VAT submission should be done through the EU unieregeling [1], [2] Not relevant for IT/marketing or the Art business: The former only sells domestically, and the latter only outside the EU	Not relevant
3 - Achievements abroad	3c	Distance sales EU	Not relevant
4 - Incoming foreign achievements	4a	Incoming achievements outside EU Belastingdienst assumes that these achievements are always charged without VAT You have to calculate and apply VAT here yourself: What would be the VAT rate and amount if it was a domestic achievement? Also include this VAT amount at pretax on the last screen, so you effectively don't pay any VAT In reality, quite some achievements outside EU do include some kind of locale VAT, sales tax, federal tax or whatever. There is a procedure to fix this, but that procedure is complicated and requires the cooperation of the selling party. This makes this procedure quite infeasable Solution: Include here the amounts that were actually payed, regardless whether they were ex- or including whatever local tax. Effectively, those taxes are outside issues	See section Accounts below
4 - Incoming foreign achievements	4b	Incoming achievements within EU	Same as 4a

Page 4: Pretax

Information needed at VAT submission - Page 3: Abroad
Category	Field	Name & Description	Consequences concerning bookkeeping
5 - Pretax	5a	Due VAT categories 1-4 This is simply the sum of due VAT from earlier categories - You can't enter anything here	--
5 - Pretax	5b	Pretax The pretax that has been incured by the company. No further details are requested	One account pretax, regardless of origin of the costs or the VAT rate

Accounts

From the tables above, we end up with the following accounts. These are only the accounts that I actually use. Note how few they actually are:

Accounts needed because of VAT submission requirements
Category	Field	Accounts
1 - Domestic achievements	1a	Account Revenue - NL - High Account VAT due - NL - High Implied: Account Revenue - Non-EU
4 - Incoming foreign achievements	4a	Separate account for each supplier (sales amounts). No need to specify whether VAT is included or not: Just treat the sales amount as ex VAT Account VAT Due: Non-EU Account VAT Pretax: Non-EU
4 - Incoming foreign achievements	4b	Separate account for each supplier (sales amounts) Account VAT Due: EU Account VAT Pretax: EU
5 - Pretax	5b	Account VAT Pretax: NL Here, enter the sum of VAT Pretax: NL, VAT Pretax: EU and VAT Pretax: Non-EU

One nett account or multiple accounts?

One account

In a bookkkeeping system, some entities have just one account, for both additions and subtractions. An example is the account Private withdrawal: It's used for withdrawing money from the business, but in the rare situations that I need to shore up finances, I use this same account to transfer money from private to business - And it works fine.

Two accounts

Some entities have different accounts, depending on whether transactions are positive or negative. Accounts receivable and Accounts payable is probably the best example. Rather than knowing the nett difference, I want to be able to track each entity on its own.

Bookkeeping & VAT (2024)

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