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Credit Note VAT Accounting

I am trying to tag a refund in the bank by raising a credit note against an earlier invoice. However the complication arises if the invoice is VAT only invoice. Whats happens in this case is that only 20% VAT part is credited as QF assumes that amount will have 20% VAT element. The original invoice is a VAT only invoice, so what should happen is that credit in bank account should either match with the line in the invoice, or worse it should ask for split of amounts (subtotal & VAT) just like it does when you raise an invoice from bank account tagging. At the moment I also cannot go on to modify the credit note (unlike an invoice) so I cannot amend a credit note to play around with VAT & gross amounts.

Is there a way around to do this so that all amounts can be tied to the bank account ?

I don’t think you can do this starting from tagging the bank transaction but what you can do is create the credit note manually starting from the original invoice - find the original invoice, do “more options” -> “credit note”, and set the correct net and VAT credits there. When you save the credit note it’ll ask you to either select a bank account for the refund or hold the funds on account. If you select the bank account option it’ll create a new pre-tagged transaction in that account, and you can then delete the (untagged) duplicate.

Hi Ian, thanks very much it works perfect, though creates duplicate bank transactions but that’s ok as I deleted the feed transactions. Many thanks.

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