Directors Expenses/Directors Loan Account

My company has two directors, both of whom pay for things out of pocket. Rather than record every little transaction, I wish to submit a monthly expense claim and and then re-imburse them from company funds.

Question 1: how to account for VAT? A typical expenses claim looks like this:

  • Taxi (no VAT)
  • Client entertaining (no VAT)
  • Software (VAT)
  • Train fare (no VAT)
  • Hotel accommodation for conference (VAT)

So, I need to record the VAT manually, rather than calculate 20% of the total expense claim. How do I do this?

Question 2: should I be using the Directors Loan Account for this purpose?

All these individual expenses would typically be itemised onto separate invoices, although for simplicity I suppose you could just put them all on one purchase invoice and split the individual items over multiple lines. The suppliers could then be called “Director Name 1 Expenses” and “Director Name 2 Expenses”. With the different lines you can then separate out the VAT. The invoice would get paid from the DLA account, you could even have 2 DLA accounts, one for each director.

One other consideration here is with any VATable items, you should have a copy of the VAT receipt, you can attach multiple receipt images to a single purchase invoice if needed.

Thanks Glenn, I have done as you suggested and it works.

Is there any way to copy/paste multiple items into the Purchase Invoice? Or import from CSV? I already have them input in Excel (a whole years’ worth) but can only seem to manually enter them, one by one.

Thanks again.

Not for line items, only for complete invoices.

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