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Bounce Back Loan Interest

How do I create an entry for Interest on the Bounce Back Loan?
No repayments are to be made yet, but I’m aware that Interest is being accrued in the Bank Loan Account.
I’m not sure how to enter the Interest amounts in to Quickfile.

If you create a new bank account for the bounce back loan you can tag the actual loan in your real bank account as a transfer from that new account.

This leaves the balance sheet as owing the loan.

When you make repayments you tag them as transfers to the new account.

Then you create a money out transaction for the interest element and tag it as such.

If you want accrue the interest then I guess you could do something similar this way.

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Hi Paul
Thanks for your response.
I have created the account and tagged as you suggest. So the double entries are Bank Current Account and Bank Loan Account. The loan shows as owing in the balance sheet.
No repayments are to be made at present, but will do as you suggest, when the time comes.
It’s the Interest bit which I’m struggling with…
I’ve created a new money out transaction in the loan account, so increasing the Loan account balance owed, but it’s screaming to be tagged, and I’m not sure which account it should be allocated to.
Thanks for your help.
Kind regards
Margaret.

Off the top of my head. Possibly accruals but id need to jot down the debits and credits to work it out properly.

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Hi Paul
I have it as Money in at the Bank current account
and Money out in the Loan Account
I’m thinking maybe an Accrual Journal might be the way to go…
Can’t understand why no one from Quickfile are helping us out???
Heads spinning, it’s too hot for this…
Many thanks for you help.
Kind regards
Margaret.

Hi @mesholmes1956

Sorry you haven’t had a reply from one of the support team - We saw that Paul was helping you so didn’t feel the need to intervene.

There have been a couple of similar posts which may help:
Bounce back loan interest payments

How do I record the bounce back loan?

As far as I was aware there are no repayments or interest to be added in the first year of the loan anyway so I wouldn’t worry to much about it until you need to.

In regards to the interest, this post should explain: Accounting for loans

Thanks Beth
I’ll take a look at the links.
Many thanks
Margaret

When you do need to create an entry for interest, you can do it as a money out transaction from the loan account, which will increase the loan amount owed, and tag it to an interest account in the P&L. If you want to keep it separate, you cuold create one specifically for bounce back loan interest.
The repayments will then go as a transfer to reduce the total loan amount, including interest. You can do it by journal but as you’ve set up the loan as a bank account it’s much easier to do it as money out.

Out of interest, are you a sole trader or running a limited company?

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