Are my Profit and Loss Figures supposed to be net of vat?

Legacy_user

I am trying to work out my profit for the last 3 months. I am VAT registered. Are the figures eg sales and purchases supposed to be Net and not including VAT?

eg example A gross(including VAT)
sales £10000
purchases £6000
profit £4000


or example B net(excluding VAT)
sales
£8333
purchases £5000
profit £3333

Which one is the correct way to get a figure for profit to put on my tax return?
I should really hire an accountant/bookkeeper

chalkie99

It's example B - assuming you are on the standard VAT rating.

System

yes, great thanks, so less income tax