From invoice to VAT return: close your month with confidence

A return is only as good as the records behind it. Before you look at the totals, go through these points:

• Every sales invoice of the period is entered, including credit and debit notes.
• Every purchase bill with VAT is entered, with the VAT amount and the supplier’s VAT number.
• The VAT category of each line is right: standard rate, zero rate or exempt.
• The dates fall inside the period you are closing.

Choose the period and open the worksheet. It groups your sales and purchases by VAT category and shows the amounts and the VAT for each, then the net VAT: what you owe or what you can recover for the period.

The categories follow the way the return is laid out, so you can read the numbers across to the form. Small differences between your figures and the form can come from rounding or from entries dated in another period, so check those first.

Open the sales list for the period and compare its total with the sales figure on the worksheet. Do the same for purchases. If a figure looks wrong, open the entries behind it. A missing credit note is the most common reason for a difference.

If you have a spreadsheet of sales and purchases from another system, our free VAT return helper can add up a CSV file by VAT category and month, as a second look.

Before you close the month, glance at the income statement, the balance sheet and the trial balance. They show whether the books hang together: the trial balance must balance, and the VAT accounts should agree with the worksheet. A sales figure that is far from last month, or a customer balance that looks odd, is worth a question before you file anything.

When you are satisfied, copy the figures from the worksheet into your return on the ZATCA portal, or hand the worksheet to your accountant. Keep a copy of the worksheet and the supporting invoices together with the filed return. Saudi rules require you to keep tax records for several years; your accountant can tell you how long applies to you.

For the rules and deadlines, read the VAT return checklist. Dates and rates change, so check the current ones on ZATCA’s website.

Make a backup of the company after you close the month, and keep the file in a second place. If you later find a mistake, correct it with a credit or debit note in the period you find it and tell your accountant, who knows how to treat it in the return.

The program does not give tax advice and it does not know your special cases, such as a partial exemption or a one-off transaction. Treat the worksheet as a well-organised starting point and let a qualified person review the return when your case is not ordinary.

Enter a month of sample invoices and purchases, open the worksheet, and compare it with your own calculation. You can do this during the free 6-month trial, without internet. Download TAQNIX ERP to start.