What rules for recording transactions on advances received should companies remember? Let's look at the information that is relevant in 2019.

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Quite often, businesses give and receive advances. And such transactions must be reflected correctly in accounting, otherwise there is a risk of receiving a claim from the tax authorities. Let's look at what an accountant should remember.

General points

The concept of “advance” is not directly addressed in the legislation. But, nevertheless, such an advance payment is made. And here it is worth knowing all the subtleties.

What it is

Advance – certain funds that are issued as an advance payment before the shipment of goods, provision of services, or performance of work.

This is a payment towards future costs, payment for products. An advance guarantees that payment will be made.

Most common operations

There are several definitions:

An advance is considered to be the amount that is given to the company’s employees on account of the funds earned in the current month.	This is a fixed amount that will not change when the salary is adjusted, since it has not yet been accrued. Food, goods, etc. can also be issued as wages.
This is compensation for the costs of	Such amounts are issued to accountable persons before they go on a trip. Upon return, you will need to submit a report on the funds spent.
This is the contractor's customer	When fulfilling obligations in accordance with contracts. The payment is intended for the purchase of materials and solving organizational issues.
This is a bank payment	What is produced for the goods,
This is the prepayment of goods in the international trade industry	—

Legal regulation

In this matter, it is worth relying on the following standards:

1. Tax Code (second part), which was approved (as amended on June 29, 2019).
2. Order of the Ministry of Finance.
3. From judicial practice ().

How to keep records of payments for advances received

Do you doubt whether you are keeping correct records of payments for the advance amounts received? Let's figure out what is most important and what to pay special attention to.

When the amount is received from the buyer

Advances received from the buyer are reflected in account 62.02 (as when issuing an advance amount to the supplier).

In addition, it is worth taking into account such nuances as offset of advance amounts and accounting from advance payments.

You just need to find out who should transfer the funds and where - you to the treasury, or the state to you.

Asset or liability on the balance sheet

Advances that were received and paid are a type of accounts payable and receivable. Those amounts that are not repaid should be reflected in.

The Tax Code requires, when receiving an advance, to determine the value added tax base and charge the tax.

Later, a basis is formed for the restoration of previously paid tax. A deduction is also possible when the conditions are adjusted or terminated and the advance funds are returned.

Account 62.02 is passive, as it works from the moment funds are received from the buyer. In this case, the advance will be reflected against the loan. If the amount of debt owed to the customer arises, the loan will reflect an increase.

Opposite actions on debit turnover will show a decrease in debt to customers at the moment when the shipment against such an advance occurs and services are provided.

In other words, the advance will be offset. After receiving an advance payment from the buyer, there is an obligation to government agencies to pay taxes.

What kind of wiring is used? When an advance is received, you need to make a posting Dt 51 Kt 62.02. Next, it is worth highlighting VAT from the advance funds, reflecting it in the invoice.

When drawing up documents, you should pay attention to the “Agreements” subconto under account 62.2. This way you can reflect the basis for future sales - invoices or agreements.

Advance amounts can also be made under a “No Contract” agreement. This means that the prepayment amount will be credited regardless of the contracts under which the goods are sold.

In typical configurations, the “Invoice issued” document is used for this. It is entered based on extracts that were previously created.

In the account transaction log, select the statement and click “Actions”, “Enter based on”. If the system has multiple statements, you will be asked to make a selection. Next, an “Invoice issued” is generated.

Which entry reflects the accrual of tax? – Dt 76.AV Kt 68.2. In a standard configuration document, which reflects the sale of goods, the advance payment is credited automatically.

There are 3 ways to process documents:

• offset the advance payment under contracts.
• carry out offsets without reflecting contracts.
• do not offset the advance.

To select a mode, click “Advance offset”. To take advantage of the tax deduction, you need to account for:

1. Ensure the formation of a transaction that restores the tax that was accrued upon receipt of the advance amount.
2. Ensure that the entry made in the sales ledger is reversed.

To do this, use the “Sales Ledger Entry”. Data is entered based on issued invoices. Click “Invoices received” on the required invoice. Next – “Actions”, “Input based on”.

A document is being generated for Dt 68.2 Kt 76.AV. Reflected as an entry that reverses information that was entered earlier.

The finance department believes that it is necessary to reflect outstanding advances and prepayments in the balance sheet, net of VAT:

The proposal of the authorized structures is to reduce the amounts of advance payments and VAT that relate to them.

Such transactions will result in a decrease in the balance sheet currency. There are also these rules:

The PBU does not mention the need to reflect debts on the subaccount of accounts 60, 62, 76. When an inventory of the settlement and reconciliation with the counterparty is carried out, all amounts of debt are identified, including VAT (namely, they are reflected in the primary documentation).

Video: paying an advance from an employee’s salary

Clause 73 of the Regulations states that both parties must show the amounts that follow from the accounting records and are considered correct.

It follows from this that debts will arise in various accounts:

Curtailing the value added tax is considered illogical from the point of view of the Civil Code. The debt of the enterprise that received the advance to buyers is in the full amount of the amounts received.

If the contract is not fulfilled, the previously received advance is returned to him. It does not matter that part of the money has already been sent by the seller to the state treasury.

Therefore, the company should not reflect the debts of the supplier and contractor on the prepayment received in full, including VAT.

The reduction of VAT does not comply with other requirements for the assessment of priority items, which are given in. Remember that advances received under the simplified tax system are taken into account in income.

Entries in the purchase and sales ledger

To record an advance payment, the supplier's purchase ledger cannot rely solely on payments and invoices.

Basis for deduction:

If these conditions are not met, your deduction may be denied. Let us give an example of how a transaction is reflected in accounting. Delivery for the third quarter was not closed.

It was paid for in parts, and the closure was also carried out in parts. Payment was made for the supplied equipment with deductions of funds contributed as an advance payment. How will the accounting be carried out?

Entries will be made automatically based on primary documentation.

But there is also the opportunity to enter information yourself - especially when processing a non-standard situation when there is no primary documentation. When entering, an entry is made on the basis of purchase invoices.

Generation is carried out automatically when an invoice is saved, if the document is generated on the basis of warehouse documents/acts for work that has been completed. In the settings you need to set “Generate records...”.

Entries are made upon requests, when an invoice is saved, if invoices are generated on the basis of warehouse documents or a document that confirms the completion of work.

If a document is generated manually without using warehouse documents, records will not be generated automatically or based on requests.

You need to create it yourself:

• click “Registration”;
• from the purchase ledger registers.

If records are generated independently, enter the following data:

1. Account number with a link to the required document from the register.
2. The paragraph to reflect the balance should indicate the amount of unposted balances on the invoice.
3. CCD number, indicate the country (written independently).
4. A type of register where posting documents are stored. Select one of the specified bookmarks. Only one document can be selected. If the document is not selected, then the data is entered manually.
5. The date when registered goods were registered, etc. Must be filled out automatically.
6. Entry amounts (automatically) – based on the amounts of unposted balances.

Formation of the statement

To generate an advance statement, click on “Statement Archive”. Next, open a window for generating pay slips.

Set “Advance” in the “Type” column. In the “Number” item, automatic assignment will be set. You can also enter the number manually. Set a date that can be changed using the calendar.

The calendar can be called up by pressing the space bar. In the “Calculation date” and “Applies to income” fields, it is worth setting the same indicators. Next, open the salary table, where there is data on accruals.

If you do not create a statement for all employees, then mark those to whom the advance is given. Then you should select “Only marked”. The “compiler” column will reflect user data.

This indicator can be adjusted independently. Workers are selected from those on the staff. If the person does not work for the company, you can manually enter the name of such person.

When you select a payment type, the “Input Table” will open. Set the required information and click “Apply”. You can print the register of statements.

Check if the table is filled out correctly. If the advance statement is created for transfers to banking institutions, check the appropriate box.

Audit of advances received

An advance can be received for the supply of material value or for the performance of work. Worth checking:

• whether the advance was received justifiably;
• Is analytical accounting maintained correctly?
• whether VAT has been transferred from the advance payment;
• are the postings made correctly?
• Do the analytical accounting records correspond to the entry in journal No. 8, the general ledgers and the balance sheet;
• Are advances received in foreign currency correctly accounted for?

Organizations in the course of their business activities are faced with the issuance and receipt of advances. Transactions on advances must be reflected correctly in the accounting of the enterprise.

Advance concept

Definition 1

Prepaid expense represents cash or other material assets transferred by one party to the relationship to the other to fulfill its obligations until the start of fulfillment of counter obligations. An advance is an advance payment that is often confused with a deposit. The difference is that if the party does not fulfill the obligation, then the deposit is not returned. In such a situation, the advance will be returned. The advance is not security for the agreement. The advance payment is only proof of fulfillment of the terms of the contract. Advance payment is always considered an advance unless otherwise provided by the terms of the contract.

An advance is issued in the following situations:

• management of the enterprise as partial payment for employees;
• by the customer before the provision of services or performance of work when concluding contract agreements;
• by the buyer to the supplier as credit for supplies prior to the actual shipment of products;
• buyer of real estate, as a guarantee of the transaction.

Advance payments are regulated in Articles 380, 711, 735 and 823 of the Civil Code of the Russian Federation and in Federal Law No. 311-FZ of Russia. Payment of advance payments for income tax is covered in Article 286 of the Tax Code of the Russian Federation. Operations for payment of advances are reflected in accounting in accordance with PBU9/99 and PBU10/99.

There are certain specifics in situations related to the payment of an advance. For example, advances for contract work on federal facilities cannot exceed thirty percent of the total cost of the project. If the seller fails to fulfill his obligations under the contract, the buyer has the right to demand a full refund of the advance amounts.

Accounting for advances issued and received

Advances issued in accounting are reflected in the account associated with settlements for shipped goods. For correct and clear accounting, it is necessary to open subaccounts in addition to the balance sheet account. When accounting for funds issued to the supplier as an advance, a sub-account is opened to account 60 to reflect settlements on advances issued. In accounting, the transaction is reflected by posting:

• Debit 60 subaccount “Advances issued”
• Credit 51 “Current account”.

Advances received from customers are reflected in the following entries:

• Debit 51 “Current account”.
• Credit 62 subaccount “Advances received”.

Features of accounting for an advance given to an employee as remuneration

The reflection of an advance given to an employee as remuneration is recorded in the debit of account 70 and the credit of current accounts. The specific date for payment of the advance is not established by the legislation of the Russian Federation. Article 136 of the Labor Code of the Russian Federation determines that wages must be paid at least every half month.

The minimum advance payment for wages cannot be lower than the employee’s salary for the time worked. Accordingly, the minimum that an employee can count on is a tariff rate or salary in an amount proportional to the time actually worked for the first half of the month.

When determining the amount of the advance, it is necessary to take into account all components of the employee’s monthly income, including additional payments, allowances for special working conditions, payment for additional work, payment for combining positions, and substitutions.

You can calculate the advance without taking into account weekends and holidays, or you can calculate it based on the number of working days in the first half of the month.

Regardless of the algorithm for calculating the advance, personal income tax must be withheld only once during the final calculation of wages for the past month. The date of receipt of income as wages is recognized as:

• the last day of the month for which it was accrued;
• the last day of work in the employee’s organization if he quits before the end of the month.

Note 1

There is often a need to issue funds on account to employees to carry out business transactions. Amounts received by an accountable person can only be used for the purposes for which they were issued. Later, the accountable person will have to report to the organization on the advances spent. Settlements with accountable persons are reflected in account 71. If there are unused funds remaining, they must be returned to the enterprise’s cash desk. In accounting, funds issued against the funds account are reflected by the entry: Debit 71 Credit 50 (51). The funds spent, according to accepted and approved advance reports, are reflected by debit entries in accounts 25, 26, 10, etc. and credit 71 accounts.

Accounting for VAT on advances

According to the general rules, when receiving an advance, the contractor must charge VAT for payment to the budget. This is defined in paragraph 1 of Article 167 of the Tax Code of the Russian Federation. According to it, the day of full or partial payment for upcoming deliveries of goods, performance of work or provision of services is recognized as the moment of determining the tax base.

The only exceptions are the following cases:

• advance payments were received by an enterprise that is exempt from VAT;
• advance payments received for the future supply of goods, performance of work or provision of services, the place of sale of which is not the territory of Russia;
• advance payments received against future supplies subject to VAT at a rate of 0%;
• advances received for the future supply of goods, performance of work, provision of services not subject to VAT;
• advances were received by producers of goods, works, services, the production of which has a long production cycle - over six months.

There is one more specific feature. Thus, in the event of termination of the contract, VAT on the previously paid advance can be deducted. But for this, two conditions must be met:

• the contract is terminated or its terms are changed;
• the advance was returned to the buyer.

It is possible to deduct VAT on advances in two cases:

• when selling goods, if payment is made before shipment (deduction is possible from the day the goods are shipped);
• when the conditions change, as well as in the event of termination of the contract and the return of the advance payment amount (deduction is possible only after adjustments are reflected in the accounting records, but no later than 1 year from the date of termination.

Write-off of debt to the buyer for a previously received advance, due to the expiration of the statute of limitations, does not satisfy the conditions described above.

Advances identified during the inventory process with an expired statute of limitations are subject to write-off for each obligation based on inventory data, justification in writing and an order from the head of the enterprise. Overdue accounts payable are recognized in other income in the reporting period in which the statute of limitations expired, in the amount reflected in the organization’s accounting records.

In this article, which, among others, was posted on the ITS disk, methodologists from the company "1C" talk about how, in edition 4.2, the "Accounting" configuration for "1C: Enterprise 7.7." Reflection of advances in accounting and tax accounting has been implemented.

1. Extract

2. Invoice issued

Receipt of advances

1. Extract

The receipt of a non-cash advance from the buyer is reflected in accounting using the standard configuration document “Statement” (menu “Documents”, item “Statement”). When posting a document, a posting is generated to the credit of account 62.2 “Settlements for advances received (in rubles)” and the debit of account 51 “Settlement accounts” for the amount of the advance received.

When filling out the document details, you should pay attention to the choice of the value of the “Agreements” subconto of account 62.2 “Calculations for advances received (in rubles)”. The value of this subconto reflects the basis for future sales - an invoice for payment or an agreement. The advance can also be made under the agreement “Without an agreement (official; for payments without specifying an agreement).” This means that when selling goods (products, work, services) to a given buyer, this advance payment can be offset regardless of the contract under which the goods (products, work, service) were sold.

2. Invoice issued

When an advance is received from the buyer, the accountant is obliged to charge VAT and draw up an invoice in accordance with clause 1 of Art. 162 of the Tax Code of the Russian Federation. In a typical configuration, this operation is performed by the “Invoice issued” document. It is convenient to enter a new document “Invoice issued” based on the previously entered “Extract” document. To do this, in the "Current account transactions" journal, place the cursor on the desired statement, click the "Actions" button and select the "Enter based on" item. If the statement contains several different advances, the system will prompt you to select the required payment from the list. Based on the selected payment, an “Invoice issued” document will be generated, filled with the necessary information.

Please note that when calculating VAT on advances received, taxation is carried out at tax rates of 9.09% and 16.67% (estimated tax rates), and the tax base is the entire payment amount, therefore the amount of tax calculated upon receipt of the advance should not equal to the amount of tax calculated on the subsequent sale of goods (products, works, services).

When posting a document, a posting is generated to the credit of account 68.2 “Value added tax” and the debit of account 76.AB “VAT on advances” for the amount of the accrued tax. In the generated posting for account 76.AB “VAT on advances”, the document “Invoice issued” itself, which generated this posting, is indicated as the value of the subconto “Invoices issued”. Thus, in the accounting results, accrued VAT clearly refers to a specific invoice.

The recorded document will be reflected in the sales book as a record of receiving an advance from the buyer.

Advance offset

1. Sale of goods (products, works, services)

In all documents of a standard configuration reflecting transactions for the sale of goods (products, works, services), namely:

• shipment of goods (products);
• sales of shipped products;
• provision of services;
• execution of the work stage

There is a function for automatic crediting of the advance payment. Three modes of document processing are possible:

• offset of advance payment only according to the agreement;
• offset of advance payment without specifying the contract;
• do not pay off the advance.

To select a mode, you must indicate the appropriate value for the “Advance payment offset” attribute in the document header.

If you specify the document posting mode “Advance payment offset only under an agreement”, then when posting the document the system will search for advances accounted for in account 62.2 “Settlements for advances received (in rubles)” on the same basis (invoice for payment or agreement) on which sale is underway.

If you specify the mode for posting the document “Offsetting an advance without specifying an agreement,” then when posting the document, the system will first search for advances accounted for in account 62.2 “Settlements for advances received (in rubles)” on the same basis (invoice for payment or agreement), according to to whom the sale is being made. Then, if the sale price exceeds the amount of the advance found, the search for advances will continue, but on the basis of “Without an agreement (official; for payments without specifying an agreement).”

If you specify the “Do not offset advance” mode, then when posting a document, the advance will not be offset.

If an advance is found, a posting will be generated on the credit of account 62.1 “Settlements with buyers and customers (in rubles)” and the debit of account 62.2 “Settlements on advances received (in rubles)” for the amount of the offset advance.

2. Recording the sales book

According to paragraph 5 of Art. 171 of the Tax Code of the Russian Federation, the amounts of VAT calculated by sellers and paid by them to the budget from the amounts of advance or other payments on account of upcoming deliveries of goods (performance of work, provision of services) are subject to deductions. In order to reflect the tax deduction, the accounting should:

• firstly, create an entry that restores the VAT accrued upon receipt of the advance;
• secondly, reverse the previously made entry in the sales book (that is, the invoice issued for the advance payment).

These operations in a standard configuration are performed by the “Sales Ledger Entry” document. It is convenient to enter the document “Sales book entry” based on the document “Invoice issued”. To do this, in the "Invoices issued" journal, place the cursor on the invoice entered upon receipt of the advance payment, which we credited, click the "Actions" button and select the "Enter based on" item. Based on the specified invoice, a new document “Sales Book Entry” will be generated, already filled in with the necessary information. When posting a document, a posting is generated to the credit of account 76.AB “VAT on advances” and the debit of account 68.2 “Value added tax” for the amount of VAT recovered when the advance is offset. The recorded document will be reflected in the sales book as an entry reversing the previously made entry (invoice issued upon receipt of the advance).

If the amount of the offset advance is less than the amount of the advance indicated in the invoice, then the amounts in the new document “Sales Ledger Entry” should be manually adjusted so that the value of the “Total” attribute is equal to the amount of the offset advance, and the value of the “VAT” attribute is equal to the amount of VAT recovered upon offset of the advance payment.

If, when offsetting an advance, several advances received earlier were offset (for example, at the time of shipment, several small advances received at different times and issued with different invoices were offset), then based on each of these invoices, you should enter the document “Sales Book Entry” .

Features of reflecting advances in accounting

1. Accounting

Let the organization give an advance to the supplier in the amount of 1,200 rubles. In accounting, the transaction is reflected by the following entry:

Debit 60.2 “Settlements for advances issued (in rubles)” under the agreement “Without an agreement (official; for payments without specifying an agreement)”
Credit 51 "Current accounts" - 1200 rubles. - an advance was issued to the supplier.

Then materials worth RUB 1,200 were received from the supplier. in view of VAT. The previously issued advance was fully offset. In accounting, the receipt of materials is reflected by the following entries:

Debit 10.1 "Raw materials and materials"
Credit 60.1 “Settlements with suppliers and contractors (in rubles)” under the agreement “Main Agreement” - 1000 rubles. - materials have arrived. Debit 19.3 "Value added tax on purchased inventories"
Credit 60.1 “Settlements with suppliers and contractors (in rubles)” under the agreement “Main Agreement” - 200 rubles. - VAT on purchased materials has been allocated. Debit 60.1 “Settlements with suppliers and contractors (in rubles)” under the agreement “Main Agreement”
Credit 60.2 “Settlements for advances issued (in rubles)” under the agreement “Without an agreement (official; for payments without specifying an agreement)” - 200 rubles. - the previously issued advance is offset. Debit 68.2 "Value added tax"
Credit 19.3 “Value added tax on purchased inventories” - 200 rubles. - VAT allocated upon receipt of materials is credited.

Tax accounting

The operation of issuing an advance payment to a supplier is accepted for tax accounting using the document “Cash Expense”. When automatically filling out a document based on accounting data, the condition for the expenditure of funds is defined as “Advance payment for the supply of property, work, services, rights.” When posting a document, a posting is generated for the movement of accounts receivable:

Debit N13.01 “Movement of accounts receivable” under the agreement “Without an agreement (official; for payments without specifying an agreement)” - 1200 rubles. - accounts receivable accrued.

The transaction of receipt of materials is accepted for tax accounting by the document “Operations for the acquisition of property, work, services, rights.” When automatically filling out a document, an attempt is made to determine the condition for the receipt of property: “With subsequent payment” or “On account of previously issued advances.” At the same time, the search for issued advances is carried out precisely according to the agreement under which the property actually enters the organization. Since in accounting the advance issued is reflected under a service agreement “Without an agreement (official; for payments without specifying an agreement)”, then from the point of view of tax accounting the advance was not issued to the supplier and the condition of receipt “With subsequent payment” is indicated as a condition for the receipt of property. . When posting a document, entries are generated for the movement of accounts payable:

Loan N13.02 “Movement of accounts payable” under the “Main Agreement” agreement - 1200 rubles. - accounts payable accrued. Debit N13.03 “VAT on accounts payable” under the “Main Agreement” agreement - RUB 200.00. - VAT is allocated from accounts payable.

After posting the documents “Expenditure of cash” and “Operations for the acquisition of property, work, services, rights,” the balance sheet for account N13 “Movement of receivables and payables,” expanded by subaccounts, will look like this:

• N13.01: final debit balance 1200;
• N13.02: final credit balance 1200;
• N13.03: final credit balance 200;

In order to reflect the offset of the advance issued, in the standard configuration, the tax accounting document “Offset of debt on the obligations of the parties” is used. In this case, the values ​​of the document details “Debtor” and “Creditor” are the same counterparty - the supplier of materials. As an agreement with a debtor, the agreement “Without an agreement (service; for payments without specifying an agreement)” must be indicated, and as an agreement with a creditor - “Main agreement”. The document form has the ability to be automatically completed.

The document should be entered on the same day the property was received and the delivery was recorded in the purchase ledger. If the delivery was not registered in the purchase book, then automatic completion will not determine the amount of VAT previously allocated from accounts payable and subject to offset. When posting a document, the following transactions are generated:

• from the credit of account N13.01 for the amount of debt (1200 rubles);
• debit account N13.02 for the amount of debt (1200 rubles);
• to the debit of account N13.03 for the amount of credited VAT (200 rubles).

It should be noted that if an advance is paid to the supplier on a certain basis (under the same agreement under which the property is expected to be received), then when automatically filling out the document “Property Receipt Transactions”, such an operation will be reflected under the condition “On account of previously issued advances ". Then, when posted, the document will generate a posting to reduce the counterparty’s receivables (on the credit of account N13.01 for the amount of the previously received advance), but will not generate a posting to account N13.03 for the amount of VAT. In this case, there is no need to carry out a debt offset operation.

The VAT payer, upon receipt of payment for the upcoming supply of goods (performance of work, provision of services) subject to VAT, must calculate VAT for payment on the prepayment (clause 1 of article 146, clause 1 of article 154, clause 2 of clause 1 of article 167 Tax Code of the Russian Federation).

And when transferring an advance payment, the VAT payer has the right, subject to certain conditions, to accept VAT from the transferred payment for deduction (clause 12 of Article 171, clause 9 of Article 172 of the Tax Code of the Russian Federation).

We will tell you in our consultation how to reflect VAT on advances received and issued in the accounting and reporting of the seller and buyer.

VAT on advances received

When the buyer transfers an advance against VAT-taxable sales, the seller reflects the receipt of funds:

Debit of accounts 51 “Settlement accounts”, 52 “Currency accounts”, 50 “Cash”, etc. - Credit of account 62 “Settlements with buyers and customers”, subaccount “Advances received”

For the amount of VAT on the advance payment received, the seller will generate the following posting:

Debit of account 62, subaccount “Advances received” - Credit of account 68 “Calculations for taxes and fees”, subaccount “VAT”

How is VAT reflected on advances received in the balance sheet?

VAT on advances received in the 2018 balance sheet, for which reporting is prepared, reduces the amount of accounts payable reflected in the liability side of the balance sheet ().

Let's show this with an example. Let us recall that in 2018 the basic VAT rate was 18%.

Seller A received an advance from Buyer B in the amount of RUB 65,000. (including VAT 18%).

The advance received and accrued VAT in the amount of 9,915 (65,000 * 18/118) were reflected by Seller A in the following accounting entries:

Debit of account 51 - Credit of account 62, subaccount “Advances received”: 65,000

Debit of account 62, subaccount “Advances received” - Credit of account 68, subaccount “VAT”: 9,915

To simplify, let’s assume that the organization had no other operations during the reporting period.

As a result of this operation, the following amounts will be reflected in the balance sheet:

• on line 1250 “Cash and cash equivalents” - the amount of the prepayment received is 65,000;
• on line 1520 “Accounts payable” - the amount of the advance received, reduced by accrued VAT (55,085) + VAT accrued for payment to the budget (9,915). The total line balance is 65,000 (55,085 + 9,915).

It will be possible to accept VAT as a deduction on an advance received upon return of the advance in the event of termination or change in the terms of the contract or upon shipment of goods (performance of work, provision of services) for which the advance was received (clauses 5, 8, Article 171, p. Clause 4, 6, Article 172 of the Tax Code of the Russian Federation).

Then, when accepting advance VAT for deduction, the following entry will be generated in the seller’s accounting:

Debit of account 68, subaccount “VAT” - Credit of account 62, subaccount “Advances received”.

VAT on advances issued

When transferring the advance payment, the buyer will reflect the following entry:

Debit account 60 “Settlements with suppliers and contractors”, subaccount “Advances issued” - Credit accounts 51, 52, 50, etc.

Based on the received advance VAT invoice, the buyer will make an entry in accounting:

Debit of account 19 “VAT on acquired assets”, subaccount “VAT on advances issued” - Credit of account 60, subaccount “Advances issued”

And will accept advance VAT for deduction:

Debit of account 68, subaccount “VAT” - Credit of account 19, subaccount “VAT on advances issued”

In the balance sheet, the amount of the advance payment is reflected minus the VAT accrued on it (Appendix to the letter of the Ministry of Finance dated 01/09/2013 No. 07-02-18/01, Letter of the Ministry of Finance dated 04/12/2013 No. 07-01-06/12203).

Let us demonstrate this using the above example of an economic situation.

The advance payment issued by Buyer B and the calculated VAT in the amount of 9,915 (65,000 * 18/118) are reflected in the following accounting entries:

Debit of account 60, subaccount “Advances issued” - Credit of account 51: 65,000

Debit of account 19, subaccount “VAT on advances issued” - Credit of account 60, subaccount “Advances issued”: 9,915

As a result of this transaction, the following amounts will be reflected in the balance sheet of Buyer B:

• on line 1230 “Accounts receivable” - the amount of the prepayment issued 65,000, reduced by the amount of VAT on it (9,915);
• The same line will show the amount of VAT to be reimbursed from the budget in the amount of 9,915.

The final balance of line 1230 - 65,000 (55,085 + 9,915).

These transactions are not reflected in the liabilities side of Buyer B's balance sheet.

When returning an advance payment (for example, upon termination of a contract) or upon receipt of goods (work performed, services rendered) from the supplier, the previously accepted VAT on the advance payment is subject to restoration (clause 3, clause 3, article 170 of the Tax Code of the Russian Federation):

Debit of account 60, subaccount “Advances issued” - Credit of account 68, subaccount “VAT”

Also, VAT on advances received and issued is often recorded in separate subaccounts to account 76 “Settlements with various debtors and creditors.” This option is convenient because it will be convenient for the accountant to see the total amount of advances received and issued in accounts 62 and 60, respectively, and not reduced by the amount of VAT.

Instructions

First, it should be noted that you should reflect advances paid only on account 60 “Settlements with suppliers and contractors.” If you use account 76 “Settlements with various debtors and creditors”, be prepared to pay a fine. This will also lead to double display of receivables and payables in the accounting book.

To prevent confusion, open a subaccount “Advances” to account 60 “Settlements with suppliers and contractors”. When making an advance payment to this account, open a credit account that shows the source of payment, this can be 50 “Cash”, 51 “Current account” and others.

If you have not repaid the paid advance at the end of the reporting period, then reflect it on line 230 (240) in the balance sheet.

When you receive goods as an advance payment, reflect this using correspondence accounts: D08 “Investments in non-current assets”, 10 “Materials”, 20 “Main production”, 41 “Goods” K60 “Settlements with suppliers and contractors” - goods against the previously paid advance; D19 “Value added tax on purchased assets” K60 “Settlements with suppliers and contractors” - VAT is taken into account; D60 “Settlements with suppliers and contractors” K60 “Settlements with suppliers and contractors” subaccount “Advances issued” - the advance paid is taken into account; D68 “Calculations for taxes and fees” sub-account “VAT” K19 “Value added tax on acquired assets” - a VAT deduction was made.

You can also deduct VAT until the goods arrive at your address. To do this, the supplier must issue an advance invoice with allocated VAT. Check the payment documents, namely the tax amount. Check the contract for an advance payment clause.

After this, make the following entries in accounting: D60 “Settlements with suppliers and contractors” subaccount “Advances issued” K51 “Settlement account” - advance payment was paid to the supplier; D68 “Calculations for taxes and fees” subaccount “VAT” K76 “Settlements with various debtors and creditors" subaccount "VAT on advances issued" - accepted for deduction of "input" VAT on advances; D 10 "Materials", 20 "Main production", 26 "General expenses", 41 "Goods" K60 "Settlements with suppliers and contractors" - goods are capitalized on account of the previously paid advance; D19 “Value added tax on purchased assets” K60 “Settlements with suppliers and contractors” - incoming VAT is taken into account; D60 “Settlements with suppliers and contractors” K60 “Settlements with suppliers and contractors” subaccount “ Advances issued" - the advance paid to the supplier is credited; D 76 "Settlements with various debtors and creditors" subaccount "VAT on advances issued" K68 "Calculations for taxes and fees" subaccount "VAT" - the amount of VAT accepted for deduction during the advance is restored ;D68 “Calculations for taxes and fees” subaccount “VAT” K19 “Value added tax on purchased assets” - accepted for deduction of VAT on purchased goods.