Receipt Bank rebrands to Dext

In a global webinar in February, Receipt Bank made the announcement that they have rebranded and is now Dext.

The new Dext brand will incorporate Dext Prepare (Receipt Bank) and Dext Precision (Xavier).

Why Dext?

During the announcement, Chief Executive Officer Adrian Blair explained the new name fuses “dexterity with next”: the dexterity that accountants and bookkeepers bring to their clients’ challenges and the next generation attitude that so many have.

What does this mean for you?

For now, there are no changes to how you use Dext Prepare (Receipt Bank) on the web or the app version.  You can continue using the same login details and same mobile app as before, but it will look slightly different.

Mobile app update

If you are using the mobile app, an update is available for Android and iOS devices that will update the app name to Dext.  There will be no changes to how the app works and you can login as you did before.

Getting into Dext

If you are using the web version you can still use app.receipt-bank.com, you may be redirected to the new address app.dext.com. Similarly with the mobile app, there will be no changes to how it all works and you can login as usual.

How do I email my documents?

Currently each user can email in documents using @receiptbank.me address, this will now be changed to @dext.cc.  The current email address will be supported for the next couple of years, it may be a good time to start using the new address.

Contact us

If you are interested in seeing a demonstration of Dext Prepare (Receipt Bank), how it works or details of the prices, please get in touch with our Digital Solutions team at digitalsolutions@mooreandsmalley.co.uk.

Domestic Reverse Charge: Digital links for Xero, QuickBooks and Sage users

The Domestic Reverse Charge (DRC) was introduced on 1 March 2021. This new reverse charge is the latest initiative to combat missing trader or carousel fraud that first appeared in relation to precious metals, computer chips and mobile phones. The DRC affects businesses that:

  • Buy or sell services that are ‘specified services’ that are reported within the Construction Industry Scheme (CIS)
  • The supplier and the recipient are both registered for VAT in the UK
  • The supply is standard rated or reduced rated
  • The supply is not to the end user or an intermediary

Supplies of zero rated construction services are not included within the DRC. For example, construction services on a new build house will be invoiced as normal under the current regulations.

Impact on the VAT return – suppliers

Under the DRC, suppliers that provide a specified service do not charge VAT on the invoice raised to the customer.

When the supplier completes the VAT return:

  • The net value of the sales subject to DRC (including credit notes) will be included in Box 6 of the VAT return as normal
  • No output tax will be declared in Box 1, as this output tax is accounted for by the customer

Output tax on services that are not included within the DRC will be declared on the VAT return as usual.

Impact on the VAT return – customers

Customers who receive a DRC invoice will account for the suppliers output tax in box 1 of the VAT return. The same amount of VAT is reclaimed as input on the VAT return, which creates a nil net result.

When completing the VAT return, Xero & Quickbooks will automatically:

  • Enter the tax on purchases subject to DRC, including any reductions due to credit notes, in Box 1 of the return
  • Reclaim the input tax on the DRC purchases in Box 4, subject to the normal rules. This includes any reductions due to credit notes
  • Enter the net value of the purchases under DRC (including credit notes) in Box 7

Please see the next page for details on how each software will cope with the changes and how to apply these.

Domestic Reverse Charge: Digital links for Xero, QuickBooks and Sage users

Xero users

To support DRC, Xero has specific tax rates to use on invoices and bills in order to report the correct amounts on the MTD VAT Return. The non-MTD VAT Return in Xero doesn’t support the DRC, so you need to set up MTD for VAT if your organisation doesn’t currently use it.

The DRC tax rates are:

  • Domestic Reverse Charge @ 20% (VAT on Expenses)
  • Domestic Reverse Charge @ 20% (VAT on Income)
  • Domestic Reverse Charge @ 5% (VAT on Expenses)
  • Domestic Reverse Charge @ 5% (VAT on Income)

The VAT Cash Accounting Scheme cannot be used where services are subject to the reverse charge, so DRC transactions are always reported on an accrual basis.

The Flat Rate VAT report in Xero does not support DRC, so transactions need to be manually added using the reverse charge provisions. Contact us for support on how to record DRC transactions under the Flat Rate VAT Scheme in Xero. Our contact details are set out at the end of this article.

How to add the DRC tax rates

  1. In the Accounting menu, select Advanced
  2. Click Tax rates
  3. Click Add Domestic Reverse Charge Tax Rates
  4. Click Add Domestic Reverse Charge Tax Rates to confirm

Quickbooks

From 1 March 2021 QuickBooks will have two new VAT codes (20% and 5%) that clients will be able to use to account for the VAT reverse charge. Once the code has been selected and the transaction is saved, QuickBooks will automatically account for the reverse charge and the VAT will be reflected on your VAT return; you do not need to amend or adjust your return.

If you are an existing client and have enabled VAT and CIS, then you do not need to set up anything. You will only need to enable and select the VAT code to apply it to invoices or bills.

How to add the DRC Tax codes

The codes will be available for activation on 1 March 2021 onwards.

First make sure VAT is set up and CIS is turned on in QuickBooks. Then go to your Taxes page and follow these steps to activate the code in QuickBooks:

  1. Go to Edit VAT
  2. Select Edit Rates
  3. Select the gear icon above VAT codes
  4. Click Include Inactive
  5. Use the toggle on the codes that you want to activate in QuickBooks

How to turn on CIS

  1. Click the Gear icon > Company Settings (or Account and Settings depending on what you see)
  2. Click Advanced
  3. Select Construction Industry Scheme (CIS)
  4. Enter your info

Sage users

Sage have now updated their software and added two new tax codes T21 and T26 but these are only being added to Sage 50cloud Accounts v26 and higher. If you are on one of these and don’t have the new codes check to see if there are any updates available. If you are on lower version than v26 the new codes will need to be created manually.

New tax codes

Two new tax codes have been created in Sage 50cloud Accounts v26 and above:

  • T21 to be used where CIS Reverse Charge Standard Rate applies
  • T26 to be used where CIS Reverse Charge Reduced Rate applies

These tax codes can be used by both the subcontractor and the main contractor and ensures that the VAT Return is updated correctly. These must be used for both your sales and purchase transactions, where domestic reverse charge applies. If tax code T21 or T26 is already in use, the next available tax code is used.

What if I do not use Sage 50cloud Accounts v26 or above?

If you do not use Sage 50cloud Accounts, you’ll need to manually create the reverse charge tax codes. For more information about creating tax codes please contact us.

  • Your new standard rate reverse charge tax code should be linked to T1 and flagged as Reverse Charge
  • Your new reduced rate reverse charge tax code should be linked to T5 and flagged as Reverse Charge

Further information

Our fact sheet sets out detailed information regarding the domestic reverse charge.

You can also watch a recording of our recent webinar which provides further explanation and guidance.

For advice on the Domestic Reverse Charge please contact:

Jonathan Main, Indirect Tax and VAT Partner, jonathan.main@mooreandsmalley.co.uk or 01772 821 021

Carolyn O’Shea, Indirect Tax and VAT Manager, carolyn.oshea@mooreandsmalley.co.uk or 01772 821 021

For advice on your accounting software please contact:

Digital Solutions Team, digital.solutions@mooreandsmalley.co.uk or 01772 821 021

Time saving and the benefits of using Receipt Bank

Over the past year there has been a lot of change forced upon many businesses.  If there is something positive that we can take from all of this, it is the knowledge that when required we have the ability to adapt.

So maybe now is the right time to start changing the way we work? Instead of working harder let’s try to work smarter and use the technology that is readily available to our advantage.

As an example I am often asked, when talking about the automation of a purchase ledger role, ‘What will I be doing if I’m not processing invoices manually?’ The answer to this is simple. You won’t be processing invoices or receipts so you will have the time to now do the things that you haven’t been able to get round to doing.

By taking advantage of the OCR technology available from Receipt Bank you will have extra time to concentrate on the things that you have always wanted to do in your business, or take some time away from the business to gain that home/work life balance that you have always aimed for.

Some of the main benefits of using Receipt Bank:

  • Save time and improve accuracy by uploading invoices in to your accounts package using the latest OCR Technology.
  • Can potentially save you VAT by automatically analysing your invoices and identifying the right amount of VAT to claim.
  • Save you tax by encouraging you to upload copies of receipts and invoices immediately rather than at the month end, which reduces the risk of paper being mislaid, lost or destroyed.
  • Seamless integration with Xero, Quickbooks and Sage making claiming expenses easy.
  • It runs in the browser on the desktop, laptop, tablet and many smart phones. It also has phone apps for both iOS and Android, and a new app for Apple Watch.
  • Can be given to your workforce, who can then upload their receipts and generate an automatic expense claim.
  • Keeps copies of your receipts and supplier invoices, meaning you can go paperless – saving you more time and money!
  • Maximises the use of cloud storage systems like Dropbox by uploading your receipts and invoices directly into your account, allowing you to use Receipt Bank to download them automatically for analysis.

If you are interested in seeing a demonstration of Receipt Bank, how it works or details of the prices, please get in touch with our Digital Solutions team at digitalsolutions@mooreandsmalley.co.uk.

Desktop or cloud accounting – is switching really worth it?

In short – Yes – being able to access your accounting records from anywhere, is more important now than ever.

Cloud accounting has been around for many years and hundreds of thousand of small businesses are benefiting from the technology of cloud accounting software. Although, there are still some businesses who still rely on manual books or spreadsheets to record their transactions.

The cost of standard Cloud accounting bookkeeping packages range from free up to £30 plus VAT per month. The software can be easily adapted and upgraded by adding compatible applications (at a further cost) which will enhance the bookkeeping package, saving you even more time and providing better insights in to the performance of your business.

Cloud accounting software pulls through your banking transactions directly from your bank, which means you do not have to manually write or type them into books or spreadsheets. You simply allocate the transactions to categories as you go along, meaning you can instantly see how much income you have taken, payments that have gone out and what level of profit or loss you are making – this can be shown daily, weekly, monthly or annually.

Having up to date information allows you to make better decisions for your business and adapt quickly to change. The invoicing function on all the systems that we deal with are brilliant, and they allow you to send invoices via email, there is no longer a need to print invoices or post them. You can also send reminders and statements to chase up monies owed within just a few of clicks of your mouse.

The main products that we deal with at MHA Moore and Smalley are:

1) QuickBooks Online – from £7.00 – £30.00 per month
2) Xero – from £10.00 – £30.00 per month
3) FreeAgent – free to Natwest business banking customers

QuickBooks Online

• QuickBooks is the global leader in cloud accounting software with more than a million subscribers worldwide.
• They have great reporting options such as projects, department and budgeting built in as standard.
• Management report packs are simple and quick to set up and there are lots of insights available to you when you log on.
• Like FreeAgent it links to HMRC, your accountant and your bank.
• A good function for many businesses in the current climate is that you can track employee time through the software for free, which many businesses have found really helpful for furlough claims.
• There are hundreds of third-party apps which you can link to but not as many as Xero.

Xero

• Xero is the market leader in the UK having penetrated the market early on after significant growth in Australia and New Zealand.
• It is slightly more expensive than QuickBooks Online and there are additional charges for its Project management and CIS module, which are free and come as standard with QuickBooks Online.
• However, Xero has more third party integrations than QuickBooks Online meaning it provides a better ecosystem for growing businesses looking to expand quickly and wanting an accounting system linking into their other front office systems.

FreeAgent

• This is a great tool for contractors and consultants.
• It has the facility to link to your bank account, HMRC and your accountant.
• It has limited integrations to third party apps compared to QuickBooks Online or Xero.
• The more complex accounting functions, such as departmental reporting, budget reporting and advanced management reports, are limited in FreeAgent which is why I would recommend this for micro businesses.

ReceiptBank

• This is an amazing product which takes your paper invoices and posts them into your software via OCR technology. No more manually posting individual invoices.
• The software can even get invoices from some of your suppliers through a “fetch” function, which means you don’t need to even scan in the invoice! Having supplier invoices in your accounting system on a timely basis allows you to be able to focus on available cash, which leads to better business decisions.

Contact Us
To find out more about cloud accounting software and ReceiptBank please contact the Digital Solutions team.

Save time by using Excel with Sage 50cloud reporting

Do you use Excel for your management reporting, manually exporting and inputting data from your Sage to update these reports?

Let’s be honest, people like Excel and you may already be doing this or are thinking about putting your reports or Sage transactions in Excel, which you can then use for your own bespoke management reporting.

Did you know that you can integrate your Sage data with Excel using the Sage 50 Accounts ODBC driver?  This will save you a significant amount of time compared to manually exporting and inputting data from Sage into Excel each month.

Using the ODBC driver

To help you transfer data quickly, easily, and accurately, you can use the Sage 50 Accounts ODBC driver to read your accounts data directly into Excel.

An ODBC driver translates the data files from one application, for example Sage 50 Accounts, so that they can be read by a Windows application that supports ODBC, such as Excel.

Once the connection has been made, you just need to refresh your Excel report and any new transactions added to Sage will be automatically pulled through.  The ODBC driver is read only, so you cannot write back to your software data files.

There are other ways

All of the reports explained below will need to be run and exported on a regular basis to keep your Excel reports up to date. 

Export

Run your report and preview on screen, click Export, choose the file type, name and location where to save.

If you selected Excel, open and format to remove merged cells and put the information into columns.

Report to Excel

Run your report and preview on screen, click Export.

This will use report formatting and may need tidying to remove merged cells and get information into columns.

Data to Excel

Run your report and preview on screen, click Data to Excel.

Report data will appear in Excel as a table, columns will be all neatly aligned.

Using the ODBC will allow you to automatically bring through your Sage transactions giving you meaningful up to date reports, saving you time from manually downloading and updating.

Contact Us

For more information on what management information you should be preparing, how you can prepare it and the costs involved please contact Nick Wetherall, Software Support Manager or contact the Digital Solutions team.

Times are changing for my accounting records

June 1986, 9am a fresh-faced young man starts his first day in the accountancy profession.  After settling in he is handed a large carrier bag contacting crumpled up invoices, receipts and bank statements, “could you get all these summarised by the end of the day”. What to do?  Luckily, he is given a calculator, pens and a pad.  Crisis averted.

Over the course of the next twelve months this young trainee would spend the majority of his time adding up 80-page, 32 column Guildhall cashbooks all by hand with the help of his trusted add lister.

The next 30 years would see some considerable changes in the accountancy and bookkeeping world.  Computers would start to appear in offices and businesses.  People would move away from traditional manual bookkeeping and use software designed to replace the old cashbook and ledgers.  Not only could you analyse the transactions far easier and quicker, but you could also reconcile the bank and check your trading statements at any point, not just at the year end.

The original software was desktop based, tying you to the office in order to keep information up to date or to get any information out.  With the advent of cloud technology, storing your data offsite, this gave you the best of both worlds.  Most of the work can be done in the office, but with cloud technology this same information can be accessed to provide quick information whilst out on the road.

Accountancy software, in particular cloud based, isn’t just confined to the general accounts it can also help with automating the day to day tasks such as;

  • Scanning purchase invoices, reducing the need to manually enter each one
  • Emailing sales invoices letting you track when they were sent and when they have been viewed
  • Taking a photograph of receipts from mobile telephone or tablet and uploading directly into the software
  • Attaching copies of invoices and receipts to transactions, reducing the amount of paperwork needed to be filed
  • Cleared bank transactions being directly fed into the software, allowing them to be automatically matched or added

This new technology has changed how a business owner can use the basic financial information at their disposal.  With more up to date and accurate information they can try and spot trends or weaknesses in the business.

No two businesses are the same, even ones in the same industry, meaning people may want different information;

  • How much am I making?
  • Who is my top customer?
  • Did I make a profit on that job?

These sorts of questions can now be answered in an instant.

Technology can help speed up the process of putting together your accounting records, allowing you to concentrate on the main reason you started in business in the first place – we are yet to find anyone who thinks great I get to do my bookkeeping at the end of the week.

For more information on this subject please contact Nick Wetherall