Early settlement discount on Sales - VAT return submitted - Best way of showing

Accounting
1

Hi

I have submitted my first VAT return. I am on accrual accounting.

Since the return was submitted a customer has paid early for three separate invoices. I offer a 10% discount for early payment by BACS.

Can anyone help as to what is the correct way of recording this on quickfile? I cannot amend the invoices because they are locked by the VAT return. Do I just do one credit note for the three invoices showing the difference or individual credit notes?

As the prices have changed the Vat will have changed as well. Is there an easy way to record this without having to roll back the VAT return each time ?

If I could I would like to easily see the difference with regard to each invoice.

Any help gratefully appreciated!

2

Hi @Cashman100

There’s no particular way to show the discount for invoices within QuickFile, but I think your suggestion of a credit note may work. This would also adjust the VAT in your next return given that the total amount due may now be lower too.

One credit note for all 3 invoices would certainly work, but I would probably favour the individual credit notes as this would give you a cleaner audit trail (the credit note would become linked to the original invoice).

If the VAT return has already been submitted to HMRC, I would suggest looking at the credit note option rather than rolling back a return so your figures are still calculated automatically.

3

Thanks for the reply! Very useful…

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