can you reverse a deposit when you are on the flat rate scheme

Yes, you can reverse or delete a deposit while on the Flat Rate Scheme, but how you handle it depends on whether you have already filed the VAT return for that period.

If you haven't filed your VAT return yet, undo or delete the deposit on the QuickBooks Online (QBO) Banking page, and the system will automatically recalculate your open Flat Rate VAT. If you have already filed the return, QBO locks the transaction under MTD rules; leave the deposit as-is and manually adjust Box 1 on your next open VAT return to correct the balance.

To adjust Box 1 on your return:

1. Go to Taxes, select VAT, and find the return you want to update.
2. Select Prepare return.
3. Next to Box 1, select Adjust.
4. Choose the correct Adjustment account and enter the adjustment amount. In this section, please refer to your accountant to manage your books.
5. Select Save, then confirm the change by clicking Go for it.

For a deeper look into how QuickBooks calculates these totals, check out this guide: Set up and manage the Flat Rate VAT Scheme in QuickBooks.

If you have any additional concerns, please reach out to us again. We’re always here to help.