Invoice paid from directors account and HMRC refund

Accounting
1

I have an invoice from my accountants but they have reduced the total I need to pay by a sum received from a corporation tax refund from the previous years accounts. I have sorted the remainder payment from directors loan account, but I am not sure how to mark the rest as paid from a refund from the HMRC as it only shows bank accounts in the paid options.

2

You need to record CT refund as one transaction and then payment of any invoice as separate transaction

3

I should have said I was a novice, but could you help with how to record the CT refund as a transaction, I can only find ideas for a journal entry but this does not tie up with the invoice, it just makes a note of the payment? If I reduce the invoice amount to what I paid the VAT will be wrong? Do I pay all the invoice then raise an invoice back for the refund but keeping the invoice with me as paid??

4

There should not be any invoice for CT, tag refund in bank to CT liability account in balance sheet or other debtors if refund was booked as other debtors in last years’s final balance sheet

5

Sorry I was not clear, the refund from HMRC was paid to the accountant who deducted it from the amount I had to pay them, so I paid them the balance. But I entered the invoice to quickfile , then marked part paid for what was the balance, but that leaves the refund they got from the HMRC outstanding, how do I account for the HMRC refund amount, there is nothing to tag as it was an invoice transaction, not direct to my bank, I have searched all the site but cannot find another case similar. I am sure it is easy, but I have only ever had bank transactions to match with invoices, in this case the invoice has already been part paid from an outside source.

6

Even though you only actually paid the difference, you need to record it in QuickFile as two transactions in your DL account (use the green “new transaction” button at the top):

  • money in for the tax refund
  • money out for the total of the accountant’s invoice

The overall balance change on the account will be the same, but now you can tag one transaction as payment to the accountant and the other as a refund of tax.

7

Brilliant, many thanks, I was really stuck but this helps, many thanks.