In January, I paid for a piece of equipment using my company credit card. I paid the credit card off using a bank transfer from my company debit card to the credit card from the current account, as shown in the current account:
I tagged the payment to the credit card as follows:
The equipment was not delivered by the supplier, and they agreed to a complete refund, which was applied to the credit card as a positive balance (the untagged transaction). I don’t use the credit card much and didn’t want a positive balance in there, but I got the credit card company to refund the money into the company current account.
I am unclear how this should all be tagged. The two transactions cancel each other out, so the net effect is zero anyway.
The simplest thing I can think of is:
- Detag the original purchase
- Create a normal purchase using the invoice from the supplier.
- Tag the purchase in the current account screen as a normal purchase (instead of a credit card payment).
- Tag the credit card refund as a refund from the supplier.
This would ignore the fact the payment went and was refunded via the credit card. Would that work or be sufficient?
As a potential extra complication (maybe?) the purchase was subject to VAT. But if I did the method above, the VAT would sort itself out … right?
Any simple help will be much appreciated. Thanks.