AAT Level 3 - Tax Processes for Business (TPFB) Mock Exam Walkthrough - Part 2

[@alexandranita5024]

very good explanation. Easy to understand

[@lee-wood]

Another great video, very helpful!

[@yo3129]

You have my sub, brill video i am due my exam in 3week

[@TracyS-n6k]

This has been brilliant for me, and my fellow students, thank you so much :)

[@ZJCattan]

Thank you, this has been really useful as I prepare for the exam.

[@vinetakrone9060]

Thank you very much, this has been really great explanation:)

[@robw4057]

Thank you for explaining. There is so much contradiction across the learning platforms I don't know what to follow and what not to. The reference materials are slightly different than the E-learning and Kaplan and my college materials on Surcharge default numbers.

[@Willboardman]

Hi Rob, you’re very welcome. I would recommend following the reference material out of those :)

[@Luna_osneue8382]

I am very confused about task 5 (a) isnt box 1 representing VAT on sales and other outputs and box 4 is Vat reclaimed on purchases and inputs. i thought fuel scale charge increases input hence would go to box 4? the other three i also do not understand, please can someone help

[@josephlindsey6080]

no since you claim the vat for all your fuel, and then charge yourself the output tax based on the scale charge, so it would be output tax box 1 since your charging yourself

[@lindakirby2540]

Thank you for another helpful video.

[@amiomgxo]

Thankyou, really clear and helpful 😊

[@farahrashid7415]

Hi there. This is brilliant . It helped me alot. Could you also do the 2nd paper please?

[@m.s.8337]

thank you so much but you did not enter the value to 2 decimal places ?

[@fionaleslie496]

Do you have a video that relates to the updated exam FA23? Thanks :)

[@Willboardman]

I don’t yet but hopefully will get it done ASAP!

[@josephlindsey6080]

im confused whether the last question is wrong as it says they had a notice to say they are already in a surcharge period from the previous quarter, so this quarter (30th Novemeber) if it was late would be the 2nd surcharge, and would be 5 percent not 2 percent?

[@Willboardman]

Right so this would be the first offence within the surcharge period (being 2%). The second offence within the same surcharge period would then go to 5%.

[@josephlindsey6080]

@@Willboardman the question says it’s already in a surcharge from a previous quarter meaning that this surcharge would be the 2nd default and would be 5%?

[@josephlindsey6080]

@@Willboardman ignore me the first late payment wouldn’t be the first default it would just start the surcharge period

[@Willboardman]

Ok I see the confusion so the first default puts you within the surcharge period but there’s no penalty at that stage. It’s the first default (while already in a surcharge period) which attracts the penalty i.e you need to hit two defaults to attract your first penalty.

[@sal_d3688]

I have a question in regards to errors on VAT Return - for example purchases errors - do these get added/deducted from Box 1 or a box 4?? I keep reading conflicting information, some saying you add/deduct from Box 4 as it relates to purchase and some saying you add to Box 1 if you need to increase your output vat. Which one is it?

[@Willboardman]

Right so, if the error is from a previous period you’ll only ever add to box 1 or 4, I.E. increase output tax or increase input tax. If the error is in the current period it would be adjusted for in the same way as you’d enter in the transaction originally. So for example sales returns missed in the current period would be deducted from box 1 :)

[@sal_d3688]

@@Willboardman so if you’ve overstated the input tax on a previous vat return then you will need to add to box 1?

[@Willboardman]

That’s correct yes :) as you’ll have claimed too much input tax you’ll need to pay this back by increasing output tax in box 1.

[@sal_d3688]

@@Willboardman that’s really helpful thank you!

[@calixtomarquez-qr3to]

Thanks so much Will for your videos, just passed my TPFB exam this morning!

[@Willboardman]

That’s great to hear! Congratulations on passing your exam!

[@staceyroe4594]

Do you have any tips for remembering what the boxes are for the VAT Return?

[@Willboardman]

So in terms of what transactions should be entered into each box? Or literally Box 1- Outputs etc?

[@shadiaaimee7468]

The books say that student loans are not payable to HMRC though?

[@Dzastii007]

7c - is employees' pension contribution always tax free? Are there any other examples of tax-free deductions? Thank you!

[@Willboardman]

There are salary sacrifice schemes which allow you to have deductions before tax such as the cycle to work scheme and union payments :).

[@AgnesAgnes1]

What about student loan repayments please? Are these allowable like employee pension?

[@nernerxhe12345]

On page 6 of 9, Error 2 How can sales invoice be output tax and goes box 1? It doesn’t make sense to me

[@Willboardman]

Output tax is charged on sales that a business makes and the VAT collected paid across to HMRC. This would then be add together and entered into box 1 to give the total amount owed to HMRC before any input tax had been deducted. If the invoice has been entered in twice this would mean it had been entered into box 1 twice therefore output tax would be too high (overstated).

[@assyntpens2976]

On Q5, the first error was tax, but the second error was sales, so surely the total error is the first value, plus only 20.% of the second value?

[@Willboardman]

Ah so both of these errors related to the VAT amounts but one was input tax and one was output tax. When dealing with errors from a previous period we ignore the adjustments that would normally go in box 6 and 7 and only adjust for the net error in box 1 or 4.