120 Checklist: reconciliation of VAT outputs to sales per annual accounts
In view of possible penalties, reconcile each VAT return to the accounting system when the return is prepared, rather than carrying out the reconciliation when the annual accounts are available. The reconciliation must consider any unusual circumstances. Any significant discrepancy must be accounted for by:
(1)deducting items that are included in sales, but excluded from outputs; and
(2)adding any items included in outputs, but excluded from sales.