Line 170 of the VAT return how to check

Which section of the declaration does line 170 include and what is its meaning?

Line 170 in the VAT return is included in the 2nd part of section 3, i.e., part of the deductions.
It should reflect deductions for advances received by the seller, from which he accrued tax payable at the time of receipt. The VAT return for reports for the 4th quarter of 2021 and tax periods of 2021 is applied as amended by Order of the Federal Tax Service of Russia dated August 19, 2020 No. ED-7-3/ [email protected]

ConsultantPlus experts told us what changes the form has undergone. Explore the ready-made solution by getting trial access to the K+ system for free.

Since accruals as a result of the update should be described in a larger number of transactions than in the previous edition of the document, the total number of descriptions of transactions and deductions in the section has increased. This led to line 170 changing the deduction serial number, but the description and line code itself did not change.

To learn about the form in which an advance payment can be made, read the material “VAT on advance payments: examples, postings, complex situations .

Purpose of line 070 in the VAT return

Of the huge mass of tax reports, the VAT return is one of the most voluminous in terms of the number of sections. And in most sections you can find a line with code 070:

In almost each of these sections, line 070 has its own specific purpose and is filled out according to certain rules approved by Order of the Federal Tax Service of Russia dated October 29, 2014 No. MMB-7-3/ [email protected]

IMPORTANT! From the report for the 4th quarter, the VAT declaration must be prepared on a new form, approved. by order of the Federal Tax Service dated August 19, 2020 N ED-7-3/ [email protected]

ConsultantPlus experts explained in detail what has changed in the form. Get free demo access to K+ and go to the Ready Solution to find out all the details of the innovations.

Companies or individual entrepreneurs preparing a declaration do not always need to fill out all its sections and lines. In this case, most often when filling out a VAT return you have to deal with line 070 from section 3. We will decipher the procedure for filling it out further.

What determines the emergence of the right to deduct advances received?

Receipt of payment (in full or partial) on account of a later shipment subject to tax obliges the seller to allocate tax from the amount of this payment (subclause 2, clause 1, article 167 of the Tax Code of the Russian Federation). This procedure is accompanied by the creation of an advance invoice (clause 3 of Article 168 of the Tax Code of the Russian Federation), which gives the buyer the opportunity to apply a deduction during the period of transfer of funds. The seller also acquires the right to use the deduction (clause 8 of Article 171 of the Tax Code of the Russian Federation), but only at a different time. This moment will occur during the period of shipment of what was sold with the condition of prepayment (clause 6 of Article 172 of the Tax Code of the Russian Federation) or during the period of cancellation of the agreement on future shipment, which will result in the return of the advance (clause 5 of Article 171 of the Tax Code of the Russian Federation).

What is the reason for the possibility of such a deduction from the seller? With the fact that there is an obligation to create an invoice at the time of shipment (clause 1 of Article 168 of the Tax Code of the Russian Federation). The use of this deduction eliminates double taxation of income received upon sale.

For details on the specifics of creating an advance invoice and entering it into the purchase/sales books, read the article “Acceptance for deduction of VAT on advances received .

Line 170 is also in section 6 of the VAT return. ConsultantPlus experts explained how to fill out this section correctly using an example. To do everything right, get trial access to the system and upgrade to the Ready Solution for free. There you will also find explanations for filling out each line of the report.

Checking the correct filling of line 170, linking it with page 070

As you can see, the sequence of fulfilling the conditions for filling out line 170 is quite simple. Therefore, it is quite easy for tax authorities to check it. This check is now automated. The fact is that the indicators on lines 070 and 170 of the VAT return are closely interrelated (clause 38.16 of the Procedure for filling out a VAT return: on line 070, the supplier shows the amount of the advance received and the amount of VAT on it to be paid to the budget. And after shipment, he receives the right to deduct the same amounts of tax. If the shipment takes place in several shipments, then the VAT deduction goes in parts. This can happen in different reporting periods, but in the end, the amount of deduction on line 170 for a specific shipment must correspond to the amount of payment of the accrued tax to the budget for the billed before the advance invoice:

if the shipment amount is equal to or exceeds the amount of the prepayment, then the amount of the deduction is equal to the amount of tax accrued from the prepayment;
if the shipment occurs for an amount less than the advance payment received, then the tax to be deducted corresponds to the amount of the shipment.

When receiving an advance payment and making a shipment in one quarter, the Ministry of Finance and the Federal Tax Service of the Russian Federation insist on the mandatory reflection of these transactions in both lines - 070 and 170 of the tax return.

How to fill out line 170

The rules for filling out line 170 (clause 38.19 of appendix 2 to the order of the Federal Tax Service of Russia dated October 29, 2014 No. ММВ-7-3 / [email protected] ) require correspondence between the data in section 3 falling into lines 070 and 170. This means that in deductions Only those amounts of tax can be taken that were accrued for payment from advances and were reflected, accordingly, in line 070. The amount of the deduction depends on the ratio of the amounts of prepayment and shipment:

if the shipment amount is equal to or exceeds the amount of the advance payment, then the deduction is taken in the amount accrued from the advance payment;
if the shipment is made for an amount less than the advance payment received, then the tax to be deducted will correspond to the amount of the shipment.

Do I need to enter data in lines 070 and 170 when receiving an advance payment and making shipments in the same quarter? The Ministry of Finance (letter dated October 12, 2011 No. 03-07-14/99) and the Federal Tax Service of Russia (letter dated July 20, 2011 No. ED-4-3/11684 and earlier) insist on the obligation to reflect these transactions if they fall within the same period.

To learn how to deal with the tax accrued on an advance payment that is among the overdue debts, read the material “VAT when writing off accounts payable: problematic situations .

Line 170 of the VAT return: explanation

Line 170 of the VAT return displays the amount of the fee calculated by the seller from the amount of payment that is subject to deduction. Suppliers often work with this value. A full breakdown of the position is indicated in the value added tax reporting. Taking into account the name, you can formulate the stages of the seller’s actions.

First he receives an advance payment in full or a certain share

. VAT is deducted from the amount. Within 5 days after receiving the money, the person who sells the goods provides the buyer with SF and deposits the tax amount into the budget. In the future, the company has the right to deduct when all work is completed or the goods are shipped. If these conditions are met, the seller can fill out the corresponding line.

The tax authorities check the correctness of the report automatically. The values 070 and 170 are related. The first indicates the values of the advance payment, the amount of the fee to be paid, then the person receives the right to draw up a deduction. If the shipment is carried out in batches, then the return is also issued in parts. You can get it at different times.

If an advance payment is received and a shipment is made in the same period, the Ministry of Finance and the Federal Tax Service require that these actions be reflected on pages 070 and 170. By performing a desk audit, the correspondence of the amounts in the report is established.

Point 170 is included in the second part of the reporting in section 3. It shows deductions from shipment for which the buyer has paid the amount to the supplier in advance. To receive a refund, you must have an advance SF, which is issued by the seller. The deduction rate for shipment cannot exceed the amount of tax allocated earlier in the advance payment and displayed in position 070.

Results

Line 170, located in section 3 of the VAT return, includes those amounts of tax from advances received by the seller, which he has the right to submit for deduction at the time of shipment or return of the advance payment.
The basis for the deduction is the advance invoice issued to the buyer upon receipt of the advance payment. The advance and shipment amounts may not coincide, and then the deduction amount will correspond to the lower of these amounts. You can find more complete information on the topic in ConsultantPlus. Free trial access to the system for 2 days.

Line 170 of the VAT return: how to check

Drawing up a declaration and checking reports is a complex process that requires special knowledge. Each item in the reporting contains some data. There are features of the design of line 170 and its recording in the report. The position is included in the third section in the deductions block. It contains the amount of compensation to the seller for fees accrued on advances against planned deliveries.

According to the rules for registering this position, its indicators must coincide with the information in position 70. Filling out a position is possible only after the seller performs certain actions. These include receiving advance payment for planned deliveries, drawing up a tax return, highlighting the amount of the fee for the received advance payment, and the emergence of the right to issue a refund upon fulfillment of obligations.

It is easy to determine the correctness of the calculation of the tax refund indicator and the correctness of the data formation. The values on pages 070 and 170 are interrelated. The first displays the values of the received advance payment and tax, and line 170 displays the contribution indicators, which can be submitted for refund after fulfilling the obligations.

When drawing up documentation, you need to take into account that the reimbursement indicator displayed in paragraph 170 cannot be higher than the amount of the advance payment prescribed in page 70. The amount in position 170 can be equal to the value in position 70, or be less.

Checking the correct filling of line 170, linking it with page 070

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if the shipment amount is equal to or exceeds the amount of the prepayment, then the amount of the deduction is equal to the amount of tax accrued from the prepayment;
if the shipment occurs for an amount less than the advance payment received, then the tax to be deducted corresponds to the amount of the shipment.

What is section 3 of the VAT return about?

Section 3 is the main part of the VAT return where taxpayers must calculate the tax due or refundable. The algorithm for filling out the lines in section 3 of the VAT return is as follows:

Lines 010–040 - displays the amount of revenue from sales (based on shipment), which is taxed at the current tax and estimated interest rates.
Line 050 is required when selling an organization in the form of a complex of accounting assets.
Line 060 is intended to be filled out by manufacturing and construction companies that carry out construction and installation work for their needs.
Line 070 “Tax base” displays the funds received for upcoming deliveries. Value added tax is calculated at a rate of 20 or 10% depending on the type of goods, works, and services. If the sale is made within 5 days after the advance payment is made, then the amount should not be indicated as an advance payment.
Lines 080–100 must contain the amount of tax to be restored.
Lines 110–118 indicate the VAT amounts.
Lines 120–190 contain VAT to be deducted.
Lines 200–210 reflect VAT payable or refundable for the tax period.

Section 3 contains the amounts of value added tax, which is subject to restoration for tax accounting in accordance with clause 3 of Art. 170 Tax Code of the Russian Federation. This applies to amounts that were previously declared in the form of tax deductions on preferential terms (the company applies a special regime that exempts from VAT).

An example of checking the completion of line 170 (with reflection in accounting accounts)

In the 2nd quarter of 2021, the company received an advance from the buyer - 50% of the contract amount in the amount of 590,000 rubles, including VAT 20%. The sale was carried out in accordance with the contract for a single shipment in the 3rd quarter of 2021 in the amount of RUB 1,180,000, including VAT 20%. Post the specified conditions among the accounting accounts, show their quarterly reflection in the analysis of account 68.2 and VAT returns. 590,000.00 / 120 × 20 = 98,333.33 - the amount of VAT on the prepayment. 1,180,000.00 / 120 × 20 = 196,666.67 - VAT amount on shipment. 196,666.67 – 98,333.33 = 98,333.33 — VAT on sales payable to the budget.

An example of checking the completion of line 170 (with reflection in accounting accounts)

In the 4th quarter of 2021, the company received an advance from the buyer - 50% of the contract amount in the amount of RUB 590,000, including VAT 18%.
The sale was carried out in accordance with the contract for a single shipment in the 1st quarter of 2021 in the amount of RUB 1,180,000, including VAT 18%. Post the specified conditions among the accounting accounts, show their quarterly reflection in the analysis of account 68.2 and VAT returns. 590,000.00 / 118 × 18 = 90,000.00 - VAT amount on prepayment. If you have any questions, you can consult for free via chat with a lawyer at the bottom of the screen or call by phone (consultation is free), we work around the clock.

1,180,000.00 / 118 × 18 = 180,000.00 - VAT amount on shipment. 180,000.00 – 90,000.00 = 90,000.00 — VAT on sales payable to the budget. Reflection in the declaration 4th quarter of 2021 VAT accrued on advance 1st quarter 2021 VAT accrued on shipment VAT on advance accepted for deduction Analysis of invoice 68.2 for 4th quarter 2021 Don’t know your rights? Subscribe to the People's Adviser newsletter. Free, minute to read, once a week.

If you have any questions, you can consult for free via chat with a lawyer at the bottom of the screen or call by phone (consultation is free), we work around the clock.

Balance at the beginning of the period Turnovers for the period Analysis of account 68.2 for the 1st quarter of 2021 Balance at the beginning of the period Turnovers for the period Balance at the end of the period A desk audit of the completion of lines 070 and 170 of the VAT declaration will establish the compliance of the declared amounts. Line 170 is part of the second part of section 3 of the VAT return “Tax deductions”. It reflects deductions from shipments for which the buyer has previously transferred an advance payment to his supplier. The basis for the deduction is the advance invoice issued by the seller to the buyer upon receipt of advance payment.