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How do I do manual refunds?

Customer makes a purchase in Euros and requests a refund 10 days later.

By then, the exchange rate has changed and the value of the refund is a few pennies higher than at purchase date.

So, the bank statement shows the original purchase at £100, but the refund amount at £101.

When I come to tag the transaction as a refund, it won’t let me and gives the following message:

“Invoices with items posted to more than one nominal account will not appear here. For such cases a manual credit note will need to be applied.”

How do I apply a manual credit note and how do I tag this transaction correctly?

Thanks

Also, I have about 150 such transactions.

Now that I have to do them manually, can anyone suggest the most efficient way?

The only way I know of to do this would be to create the credit note via the “more options” drop down on the original EUR invoice, which should allow you to set the GBP value of the refund. This will create a duplicate pre-tagged transaction on the relevant bank account, so you then need to delete the untagged one that came from the bank feed.

To my knowledge (I don’t work for QuickFile) there’s no way to link a credit note refund to an existing bank transaction, only to create a new transaction as above.

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Thanks @ian_roberts

@QFMathew, is this the official position?

(Note: The original invoices are in GBP because they were created from bank transactions on a GBP bank account.)

Is @ian_roberts solution QF’s official solution?

Hi @fambi,

the way that @ian_roberts has explained would be the way that I would have said, so if you call that the QF official solution then yes it is :slight_smile:

When the amount being refunded is less than the invoice amount, everything is easy and can be done through the standard refund option.

But when the amount being refunded is more than the invoice amount and I follow the proposed solution, the duplicated transaction is of a different amount, so I can’t just delete the original transaction in the bank account because they are different amounts.

How do you propose I resolve that?

Hi @fambi,

you can create a stand alone credit note that equals the amount coming back to you. You would do this by raising a negative invoice. you will then be given the option for where the refund should be entered (this will generate the bank transaction so you will need to remove the original)

Managing credit notes May help?

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When doing that, how do I tag the original bank transaction?

Or do I delete it?

It might be easier to delete it if it’s generated a duplicate

Out of interest, is there any downside to tagging the refund by creating a journal entry paired with the General Sales account?

If you do it with a journal it’ll be right on your P&L but the transaction won’t appear in your VAT return (assuming you’re VAT registered) as QuickFile only uses sales and purchase invoices and credit notes for VAT.

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