When purchase refunds are entered as a Quick Cashbook – Deposit, the system will automatically treat these as Output VAT. This is because deposits are considered money in, and in the context of a VAT return, they are handled in the same way as a sale.

For reference:
  • Deposit = money in → treated as Output VAT
  • Withdrawal = money out → treated as Input VAT
Any payments or receipts entered through the Payment or Receipt modules will automatically be set to Not Applicable for VAT, as these document types do not allow VAT coding.


The only cashbook document types that allow VAT to be recorded are Quick Cashbook Deposits and Quick Cashbook Withdrawals, each following the VAT direction outlined above.


Because Quick Cashbook Deposits are always treated as Output VAT and cannot be changed, any purchase refund that needs to be recorded as Input VAT will usually require correction using a tax‑only manual journal.