Hello everyone,
I recently saw an offer on a decent new laptop for work. Not having enough in the account as cash flow is down due to the coronavirus, I decided to purchase it anyway using a combination of the company debit card, plus my cash float, and to make up the total £50 out of my pocket.
I can lend that £50 to the company as a sole trader hopefully getting it back when this Coronavirus is over should I stay trading. But I do not know how to record this laptop purchase with 3 different element of payment?
The till and VAT receipt shows the full amount paid as: 2 elements - Visa Debit and Cash.
I would appreciate any advice as I need to put my VAT in tomorrow 31st March so I can reclaim the VAT paid - this quarter has been a really bad one.
Thank you in advance.
Fanflame
Well as a sole trade you don’t get the money back. It was yours to begin with. Plus sadly as its a capital expense the only tax relief you should be getting is 18% of its value each year.
Called a capital allowance.
However for the treatment of recording the payments.
Money out transaction from the cash account
Money out transaction from the proprietor drawings account
And your transaction for the visa debit will already be on your bank transaction.
Tag them all to pay off the purchase.
And remember when completing your tax return the laptop is a capital allowance so you should remove it from the expenses box and add 18% of the cost to the capital allowance box.
Do laptops not qualify for 100% AIA?
Yes they do. But like capital allowances they are a tax reducing computation as opposed to an expense on the p and l
Also differences to note are, if your profit ends up being less than the capital cost, with capital allowances you can carry It forward, with AIA you can’t. So it really depends on the end result to determine with method is better suited.
Thank you for your input Gentlemen I really appreciate it. I have spent the morning bringing my paperwork up to date and now come to look at this. I class myself as a complete novice when it comes to doing the books and often scratch my head with figures and Quickfile.
Firstly, I don’t know how to record a Capital Expense on Quickfile?
Secondly, as I have one entry in Quickfile for the full amount I paid to PC World Business, I don’t know how to Tag the 3 individual payments i.e. break it down into the 3 part payments?
Any further advice is gratefully received.
Bless you.
Where is the full payment recorded on quickfile? You should just have a purchase for the full amount. Unless you marked it paid in which case from what account?
Hello Paul, Thanks for responding.
The Full amount isn’t anywhere in Quickfile at the moment. There is a transaction in the Current Account for the £279 that went out of the Visa Debit card and I have now categorised that as Office Equipment (Asset). That appears okay to me now.
However: I have another £200 that I need to add to complete the ‘Total Invoice’ of £479 - this is the amount that I paid out Cash. Some of that was the Cash Float, the rest a cash expense I need to get back or invest in the company. I am stuck on what to do?
I can’t believe I’ve made it so complicated!
Thanks for your help!
Fanflame
I am thinking at the moment that I simply put this down as an expense?? Some of it will come out of the Cash Flow and the remainder I will have to p
Are you a sole trader or a Ltd company? The answer could depend on which one you are.
How did you tag this? “Payment to a supplier” or “something not on the list”?
Hello, Sorry had to walk away from the PC for an hour!
I am a sole Trader Paul, and in answer to Ian, I tagged the Visa Debit as Payment to a a Supplier and cost PC World Business whom I have used a number of times. This cleared that Visa Debited transaction nicely…
Now I have the muddle of entering a new purchase for the remainder of the Cash Float; and then adding either an expenses entry for the £50 cash I put in so I can claim it back (one day if we survive this coronavirus. Or putting a personal loan into the business, which at this moment seems the best way. ( I did enter a personal loan when I started the business.) However I am not sure how to tag it. i.e. a personal loan, cash in by Bank Transfer to the Proprietors Account??
I will have a mooch around and see as I need to sort this tonight.
Bless you guys.
Fanflame
Great. In that case the simplest way to deal with the rest is to “modify” the existing purchase and change the amount to match the full net and VAT as per the invoice from PC World Business. When you save the purchase this will mean it now appears as part-paid, with an outstanding balance equal to the sum of the cash and personal payments you made. Now “log payment” and enter the two other part payments as appropriate, using the petty cash account for the amount that came out of your float and the proprietor drawings account for the £50 contribution from your own funds.
You’ll end up with one purchase (for the full amount) fully paid by a combination of three payments from three different bank accounts.
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Excellent Thank you Ian, I have done so! 
We got there in the end!
Have a good evening and stay well! 
Fanflame
Also if you ever decide to take back the £50 you dont create a purchase. You just tag the money out as proprietor drawings account again.
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Thanks Paul.
That whole process took over half a day to work out! I won’t be doing again anytime soon! 
Thank you and Ian for your good advice and help.
Stay well both of you over this Coronavirus period and I hope you , and your business’ survive and thrive thereafter. 
Fanflame
For future reference, if you have other purchases like this in future where the payment is split between your current account and other places, it’s handy to note that when you tag a bank transaction as “payment to a supplier” you can use the “pay down multiple invoices” option - while the name suggests this is only for use when you have one payment paying for more than one purchase, it’s actually for any situation where the payment amount doesn’t exactly match the total value of a single purchase, whether that’s a split payment across multiple purchases or a part-payment towards a larger total.
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