You filed every return on time. That does not prove they were right. The close is the only moment you compare the year declared with the year recorded, line by line, and where gaps can still be corrected before they set. It is one block of the closing sequence, handled once sales and purchases are cut off.
The checklist in five points
- Reconcile the VAT accounts to the sum of the year’s returns. This is the check that reveals everything else.
- Check the VAT credit carried forward: the accounting balance and the declared carry-forward must agree.
- Work through the five adjustment cases: partial deduction, early disposal, credit notes, deposits, unpaid invoices.
- Check the split by rate across the whole year, not period by period only.
- Keep the reconciliation sheet with the closing file, dated and signed.
1. Reconciling accounts to returns
This is the central check, and it comes before all the others. If the two sources do not agree, there is no point examining adjustments: the gap comes from elsewhere.
- Total the output VAT across every return for the year.
- Compare that total to the movements on the output VAT account in the trial balance.
- Do the same for recoverable VAT, separating costs from fixed assets.
- Check that the VAT payable at closing matches the last return not yet settled.
- Reconcile any VAT credit to the carry-forward shown on the last return.
- Isolate each gap before trying to explain it.
A gap on recoverable VAT most often comes from an invoice recorded in one year and deducted in another, or from confusion between the costs account and the fixed assets account. That second cause does not change the total deducted but distorts the breakdown, and it is dealt with at source in the purchase entry.
2. The five adjustments to examine
Once the accounts reconcile, five situations may require a correction. They do not concern every business, but each must be explicitly ruled out.
| Situation | What to check | Who it concerns |
|---|---|---|
| Partial deduction | The year’s final fraction against the one applied during the year | Mixed taxable and exempt activity |
| Disposal of a fixed asset | A disposal within the retention period triggers a repayment | Any disposal of capital goods |
| Year-end credit notes | Credit notes issued and received, taken in the right period | Every business |
| Deposits collected | VAT due on collection, even with no delivery | Activities taking deposits |
| Unpaid invoices | What happens to the VAT under your chargeability regime | The debits regime above all |
The second line is the most often forgotten, because it is triggered by an asset sale rather than a purchase. The calculation and its conditions are set out in disposing of a fixed asset, and it is better raised before the price is set than after the sale.
3. The annual check on the split by rate
The period check, done monthly or quarterly, does not reveal constant errors. A product record set to the wrong rate produces a regular gap, and therefore an invisible one from one period to the next.
- The annual ratio: Compare the year’s output VAT to the year’s taxable turnover. Set it against the previous year’s ratio, at comparable product mix.
- The product list by rate: Print it once a year and read it through. It is the only moment a configuration error becomes visible, since it raises no alert of its own.
- Exempt sales: Check they rest on a justified status rather than an entry shortcut. The cumulative annual figure makes the anomaly visible.
- Out-of-scope sales: Check they do not include operations that should have been taxed, which is the mirror error.
This check follows the same reasoning as the output VAT control, but applied to the whole year: it is the cumulative total that makes visible what a single period conceals.
A VAT credit is not an asset you can forget
The credit carried from one year to the next must be reconciled at every close between the accounts and the last return. A gap that settles in is then carried forward indefinitely, grows, and becomes impossible to justify at the moment it really matters: on a refund claim or an inspection. The carry-forward is not automatic from an evidence point of view, even where it is from a calculation point of view.
4. The sheet to keep
The work is only worth something if it stays demonstrable. The reconciliation sheet is what turns a check into an audit trail.
- The annual total declared, by nature: output VAT, recoverable VAT on costs, on fixed assets.
- The corresponding accounting total, taken from the trial balance.
- The gap, line by line, with its explanation and its supporting document.
- The adjustments examined, including those ruled out and why.
- The VAT credit carried to the following year, reconciled to the last return.
- The date, who performed the check, and the manager’s sign-off.
Explicitly listing the adjustments ruled out is what separates a check from an impression. Writing “no disposal of fixed assets during the year” takes ten seconds and is worth far more, two years later, than a silence someone will have to reinterpret.
Mistakes to avoid
- Assuming returns filed on time are necessarily correct.
- Not reconciling the VAT accounts to the sum of the returns.
- Mixing recoverable VAT on costs with that on fixed assets in the check.
- Forgetting the adjustment triggered by an early disposal of a fixed asset.
- Checking the split by rate period by period only.
- Keeping no dated reconciliation sheet.
Frequently asked questions
When should this review be done?
At the close, once the year’s sales and purchases are cut off, and before the financial statements are drawn up. It comes after cut-off and the stock count in the closing sequence.
What if the accounts and the returns do not agree?
Isolate the gap before explaining it: by period, then by type of VAT. The most frequent origin is a year-end timing difference on a purchase invoice, or confusion between the costs and fixed assets accounts.
Does a VAT credit carry forward automatically?
Carrying forward is the rule, but it has to be justified. Reconcile the accounting balance to the declared carry-forward every year: an uncorrected gap propagates from year to year and becomes very hard to explain later.
Is the rate check needed again if done monthly?
Yes, because the two checks detect different things. The monthly check catches one-off anomalies; the annual check catches constant errors, particularly a product record set to the wrong rate.
Does BelloPOS produce these annual totals?
BelloPOS gives sales split by rate over the period of your choice from Lite onward, and accounting journals with Pro. Reconciling to the returns filed, and the adjustments themselves, remain closing work done with your accountant.
What to take away
The year-end VAT review is not a calculation, it is a comparison: the year declared against the year recorded. Reconcile the two, work through the five adjustment cases even to rule them out, check the split by rate across the whole year, and keep the sheet. It is half a day that saves reconstructions lasting several.
Sources
The figures and rules quoted above come from these pages, read on the date given in the article.
- Moroccan Tax Administration, 2026 General Tax Code
- Ministry of Economy and Finance, General Code of Accounting Standardisation, read 1 September 2026
Sales by rate, over whatever period you want
BelloPOS splits sales by rate and produces totals over the period of your choice from the free Lite licence onward; accounting journals and exports arrive with Pro.
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