One of my clients uses their ISA account to save for their tax and other large unexpected business expenses. They want the ISA account linked with their accounts show it shows in the balance sheet as an asset at year end.
My question is, how do I account for the interest earned as it is not subject to tax?
Thanks in advance
Corry
P.S. I did do a topic search for this subject but nothing cam up - apologies if it has been asked before!!
I would debit the ISA account with the interest, and credit an appropriate capital account. You could even create one account, just for ISA interest earned and then transfer its year-end balance to capital b/f. This way it's not shown on P/L since it's considered a capital transaction.
-- Edited by richard2013 on Sunday 19th of October 2014 04:01:46 PM
