How to tag a bank loan

Hi, Just trying to figure out how to tag a bank loan in Quickfile, the loan was paid from the bank directly into my business account.

Many thanks.

Tag as “something else not on this list” and search for loan…code 2300

You can treat the loan just like another bank account. Create a new bank account in QuickFile and set the type to be a loan account

  • the initial payment of the loan into your current account is a bank transfer from the loan account, leaving the loan account appearing “overdrawn” by the amount you borrowed
  • when the bank charges you interest, make a money out transaction on the loan account and tag that to a suitable expense code - there might be one already or you might need to create one
  • when you make repayments, those are simply transfers back the other way, into the loan account to reduce the overdrawn balance.

At any given time the balance on the loan account should equal the amount you owe at that time - what you borrowed, plus interest charged, minus repayments made.

Thank you, I’ll take a look.

That’s great, thank you, appreciate the help.

Hi Ian,
I like this answer …it makes things simple. The problem is that the bank loan account is automatically given a code with the 1200 (bank/petty cash nominal range) which generally is a current asset. The loan is a current liability and a code in the 2300 range would be more appropriate.

Possibly so, in Sage terminology, but in QuickFile the balance sheet report automatically classifies all codes between 1000 and 2999 as current asset or current liability depending on their balance, not their code. Nominals in that range whose balance is debit show as assets, nominals whose balance is credit show as liabilities, and when a bank account switches from holding money to going overdrawn it moves from one section to the other.

That’s very clever of the developers!..you are correct in that I had been a Sage user for many years and assumed that as QF uses the same/similar coding structure, then it would appear the same as Sage on the Balance Sheet. Many thanks for pointing this out and I can advise my own clients how to tag bank loans in the future.

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