Hello
We pay for indemnity insurance monthly through our business current account. Do we set up recurring invoices to log this & then tag them to the bank transaction each month? Or is there a better/easier way? Sorry new to all of this! Thank you.
That would give you a one to one match between what goes through your bank account and what is in Quickfile. Anything else would be more complex to process.
A recurring purchase would be the easiest way to deal with it.
Alternatively you could just create one purchase for the full amount when you receive the annual bill and log multiple part payments against that purchase through the year, but then you would need to make a year end adjustment to apportion the appropriate amounts to each accounting year (unless the original bill happens to come in the first month of your year).
For something like insurance the two approaches should be equivalent but if you’re VAT registered then for anything that attracts VAT (e.g. an asset on hire purchase) you’d need to log the purchase up front for the whole amount so you claim the VAT in the right period (talk to your accountant if this applies to you).
I would simply create a tagging rule from the bank payment which will automatically tag each payment to the insurance company and automatically create an invoice for each payment.
If you do that ensure the insurance companies purchase account on Quickfile uses the correct nominal account for insurance.