Some nice sums of money have come into the account from HMRC as VAT refunds, I have bank receipted them but allocated them to VAT liability (2202) - I think this is wrong as it's coming up as a cr in the nominal code rather than a dr - can somebody tell me where I am meant to put VAT refunds and shouldn't it show up as a DR rather than a CR as the money has come in.
If HMRC owe you money they are a debtor, and will have a DR balance on the account. When you receive the refund, you will have debited the bank account, to increase the balance, and by default, have credited the VAT account to reduce the outstanding amount.
So if you look at the activity it will show a Credit posting, which will clear the outstanding debit balance
if only it were that way round - this is first year of trading and the accounts are being transferred from excel to sage by me. I have put the initial income on sage (share capital, directors loans) but VAT refunds have come in too as they have been setting up the business since last april. I then set about putting on the suppliers, and their mounting invoices, then put the petty cash expenses on I am currently paying supplier invoices on sage I just got confused as the VAT came in to the bank before there was anything on sage to give me an outstanding amount to balance
It's all just back to front because of the time delay in putting the details on V the reality of the business running - is that right?
Not 100% sure i understood what you were trying to say there but if I understand correctly, you have entered a VAT refund without the corresponding balance being entered on the Sage VAT liability account and been left with a credit balance (which would be correct).
If this due to pre trading expenses incured before the business was set up then you will need to enter those on.
Hope I got that right
Bill
Edit: PS I answer to just about anything except William. Only me mum calls me that, when she's peed off with me
-- Edited by Wella on Sunday 31st of July 2011 04:19:30 PM
