I received an international money transfer, and even though it was a GBP transfer into a GBP account, my bank deliberated them to a generous amount of money before crediting my current account.
As a consequence, automatic invoice payment matching does not work, because I have a difference in the amounts.
Invoice amount: GBP 3,000 (reverse VAT)
Client payment: GBP 3,000
Bank fees: GBP 7
Net amount on account: GBP 2,993
How would I deal with that?
N.B.: The real world situation is that the client has overpaid, probably by mixing up converted numbers. But the problem remains the same for future invoices.
You can either create another bank account and call it Invoice settlement bank charges and use that to allocate £7 along with normal invoice receipt tagging of 2993 or you can tag full amount as usual to normal bank and create another entry in normal bank for £7 and tag it to bank charges
Thanks for your answer.
I don’t quite understand, however. Manually messing with journals will get my accounts properly balanced, but I am not sure how this works with the Quickfile UI.
What’s worse, the actual situation is a bit muddled, because the client overpaid. Hence the first two invoices will are marked as paid in full, but the next one will have to cover two payments, plus two times bank fees somehow. Doing it manually, the sums will match, but how do I tag the mismatching transfers, bank fees, and invoices so that things are working out?
I am confused…
You can tag receipt from customer as normal (full amount) or over payment, say invoice was £100 and you got 105, this extra £5 will sit in client’s on account when you log receipt on invoice itself and can be used to allocate to next invoice due from client.
Now dealing with bank fee on transactions, either you can create a payment entry for bank fee in bank it self and tag it to bank charges or do journal, either way it will work
Thanks for the answer. It took me a while to figure out what exactly you meant. What I eventually did is the following:
- Create a merchant account called “International Money Transfers”
- Tag the transfer as a split transaction:
a. Debit GBP X on (1200) Current Account,
b. Debit GBP 7 on (7901) Bank Changes, and
c. Credit GBP (X + 7) on (1257) International Money Transfers
- Instead of paying down an invoice against the current account transaction, I logged payments against (1257) International Money Transfers
As a result, I comfortably see the balance of the overpayment in the balance of the newly created account.
I think that is sufficient in case any accounts audit will descend on me…