The function for making journal adjustments does assume an understanding of double entry book keeping. The interface could do with being updated to make things clearer for non specialists.
What do you call 1202 account? Is it some bank account?
Its just a nominal code i think
What is the nature of code? Why do you want to move drawings from 3100?
Because 3100 is drawings
I have a balance in both codes, and i think only one should have a balance
The usual way I work is to use the drawings “bank” account day to day through the year to record money I take out of the business and smaller things I buy for the business with my personal cash/card/etc. For larger chunks of capital I tag straight to the “capital introduced” code.
At the end of year I zero the balance on the “bank” account with a transaction tagged to 3100. So 1202 is effectively a running total of this year’s drawings and 3100 is the accumulated drawings from earlier years. I may end up moving things around again once my accountant has done my tax returns - this is only my second year in business.
To add to the points above, you may wish to take a look at this post too:
http://community.quickfile.co.uk/t/sole-trader-drawings-on-p-l/12072/4?u=qfsupport
Ok so i will just leave the codes alone and at end of tax year move everything to 3100. Its just for personal stuff mostly my drawings is that correct?
I am going to simplify things by not recording personal purchases.
I understand what you mean,
As i have all my personal bank accounts linked i have tagged personal transactions that are not to do with business as personal drawings.
I then have a few business transactions that are tagged as an expense.
In the future i want to simplify this. So to do this i would need to use the drawings bank account and input any small purchases for my business, like office supplys etc.
Then at the end of the year you zero the balance so you don’t pay tax on the business expenses. Is this correct?
I am mainly confused because i have a balance in these two;
1202 Proprietors Drawings Account 4,223.94 -
3100 Proprietor or Partner Drawings 2,020.49 +
Thanks again!
Scott, like you I am a sole trader. Remember that there is no legal separation between you and your business and any money you take out of the business that is for personal use (e.g. a meal out with your partner, buying a new tv) must be recorded as drawings in your books. Drawings is a capital account (in book keeping and ‘T’ accounts terms) so if you take, say, £100 as drawings, you would debit drawings a/c (decrease) and credit your bank (decrease). If you introduce personal money into the business, the entries would be debit bank (to increase) and credit capital account (increase).
Personally I prefer to record all instances of drawings directly to nominal 3100 (proprietor or partner drawings) as this sits in the capital and reserves section of your balance sheet. Although important to record ins and outs on drawings, it is really for your own information as hmrc are only interested in taxable net profit.
Thank you for this. I think I understand now I’ll leave it as it is I guess. If I introduce my own cash I’ll put it as capital introduced
Although my personal accounts are not nesssecary to be on the accounts. Like it’s not cash introduced to business. Such a mess 
like I added. A personal credit card to account . I have few personal accounts
So as what I understand is that you would like to draw cash from the business e.g a profit which you have earned
Once cash is withdrawn from the bank.
Tag the bank transaction to nominal 3100 which is drawings
No if I have credit card for example I have added 200 as an expense s cogs then I wants to keep balance update on QuickFile I mark all personal transactions as drawings am I missing something’s thanks
I don’t understand your last posting at all, I’m afraid. Maybe you can explain thinsg again? As I mentioned earlier, all non-business related costs must be tagged/classified as drawings and that is below the net profit line. Do you have a business current account?
Hi no business account I just been putting personal transactions as drawings.
For example I have a credit card and I wanted the balance to match on QuickFile I spent 800£ on purchase for cost of goods rest are personal purchase which are marked as drawings.
As I understand as long as I provide a profit and loss the drawings don’t matter
Correct, and as per my earlier response. The profit before tax (or taxable income) is the key line in the p&l a/c. You have a personal allowance this tax year 2016/17 of £11,000 before you are liable to income tax. Be aware of Class 2 and Class 4 National insurance also.
Thanks your been very helpful in clearing my points up. Put my mind at ease.