The wrong VAT code T1 has been used when entering into the director loan account for fuel instead of T9, do I simply jnl credit VAT control a/c & debit director loan a/c with the amount and am i correct in thinking T9 is used for all transactions made to the director loan account
You can use the maitenance section (file>maintenance) to amend mistakes such as that. And yes you are correct in not claiming the VAT and using T9 for directors loan journals.
What was the value of the VAT on the original transaction? You just need to satisfy yourself with regard to "Voluntary Disclosures" with regard to VAT errors.
With regard to SAGE, I would simply post a contra entry using the same T1 VAT code to cancel out the original transaction, both the the net amount and the VAT element. Then re-enter the journal transaction using the correct T9 VAT code.
Go to http://www.hmrc.gov.uk/vat/managing/problems/corrections/correct-mistakes.htm to get a bit more detail on the voluntary disclosure process and the limits involved.
