I am new to using sage and have started a new job using it but am teaching myself. I have received a refund from a supplier by cheque. The original invoice was entered and paid Sept 2012 and was for insurance (T2). How do I record the refund on sage? I have an old version of sage.
Enter a credit note against the original supplier, nominal and T2 VAT code, dated on the refund date.
Then (and this sounds a bit odd I know), enter another INVOICE on the same date as the credit, but instead of using the 'insurance' nominal, post the invoice amount to '9999 Suspense' and use T9 VAT.
Then process a Bank Receipt (which represents the cheque), but also to 9999 Suspense.
Your original transaction went
CR 'insurance' nominal
DR 'Accounts Payable'
Original payment went
CR 'Accounts Payable'
CR Bank
Credit note for refund goes
DR 'insurance' nominal (thereby reducing recorded expenditure on that item)
CR 'Accounts Payable'
Refund Invoice goes
DR 'Accounts Payable' (cancelling above credit)
CR Suspense
Refund payment goes
DR Suspense (taking suspense back to zero)
CR Bank
It's a tricky one this, and had me stumped for a while back in the day. Used to have it written on a post-it note somewhere but I can usually remember it now.
Oh, and take a backup before you do the postings, in case you get something wrong, or you'll be journalling until the cows come home...
