Donations, EPOS and invoices

Accounting
1

Hello
We are a community benefits society and often receive donations from our customers either through credit card payments or through cash. We have a donations button on our epos system that records both. The epos treats these donations as if they were sales so they inflate our sales figures. How should we be dealing with these amounts - we currently create invoices on Quickfile based on the epos sales per month. The donations have to date been included in the zero rated totals along with regular sales for the month they were given and I’m not sure that is the right approach. I’m thinking we should show the donations as a separate entry - we have created a nominal ledger code 4906 for Donations Received with this in mind. So my questions are:

  1. If this the correct approach to take and if so how do we rectify the invoices that have treated donations as if they were general sales?
  2. Is there a better way of doing this?
    As we are VAT registered these invoices are now locked.
    Any help would be greatly appreciated.
    Regards
    Helen
2

I’m not an accountant so I can’t advise on the correct treatment for your VAT return but if it is the case that donations shouldn’t count in box 6 then probably the simplest way to deal with it in future would be to make two separate invoices from the epos records, one for everything except the donations which is treated normally for VAT and one which is “out of scope” for the donations, posted to the new nominal code. If both invoices are for the same “client” (probably a dummy “shop sales”) then the cash and card payments can be spread across both to pay them off.

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