Important: If you have filed VAT in QuickBooks 2008 before upgrading to Release 3 (R3), this information applies to you.

When updating your QuickBooks 2008 company file to R3, a window titled "QuickBooks VAT Return Information" is displayed. This window contains a link open a copy of your last VAT return in PDF format ("Click here to open the VAT return for the last filed period.").

The PDF that is launched by this link displays figures in boxes 6 to 9. In many cases, these figures may contain very large amounts (that is, in the hundreds of thousands or even millions of Pounds). This is because the box 6 to 9 figures on this PDF are cumulative totals for the net value of sales and purchases in your company file. That is, they are for all historic periods from day 1. (This action addresses an issue with the product in Release 1.)

This product issue, which was identified in QuickBooks 2008 Release 1, has now been corrected in QuickBooks 2008 Release 3. To ensure that numbers in boxes 6 to 9 are correct in the future, you must enter the numbers from the PDF report in the "QuickBooks VAT Return Information" window. Please do NOT use the numbers from any other source, such as your paper-based VAT return. You must use the VAT figures from this PDF regardless of the amounts.

In QuickBooks 2008 Release 1, net amounts (boxes 6 to 9) on the VAT 100 were based on transactions within the date range of the VAT report. This meant that transactions that were added or modified outside the date range (we call these "exceptions") — such as in a previously filed VAT reporting period — would not be reported in the current filing period.

QuickBooks 2008 Release 3 (R3) ensures that the net sales and purchase amounts reported in boxes 6 to 9 on the VAT 100 report include transactions that were added or modified in a previously filed VAT reporting period: "exceptions".

When opening a company file for the first time upon applying the R3 patch, QuickBooks will update the company file to work with the new release. During this process, you will be asked to enter "VAT Return Information". The information you enter will be used to zero out the figures in box 6–9 on the VAT 100 report as of your last filing date, therefore providing a clean starting point for all future VAT reports created in QuickBooks 2008 R3 and higher. This clean start enables us to accurately bring forward all back dated additions and changes to transactions ("exceptions") into the current VAT reporting period.

Related Article: After installing the QuickBooks 2008 R3 update, why are the net amounts in boxes 6 to 9 of my VAT returns so large? How can I fix this?