I am a new employer and on the first payroll one of the employees had a large tax rebate due. So I paid it and allocated the full payment against the Directors Salaries (as it was a Director) and made the payment to them.
Having talked to HMRC they said a refund would be made to me quickly but it appears that it will not be.
My issue is that the tax rebate is showing as a payment in the P&L and therefore showing me with a P&L loss which is not really the case. Since then I have completed 1 more payroll and obviously owe HMRC nothing but that negative amount on my HMRC PAYE account is still very high and probably will not be paid off in 6 months.
Is there a way that I can show in the P&L that there is this rebate due (possibly before end of March) and each month reduce the balance on that rebate by the amount I would have paid HMRC should there not have been a negative balance?
Thanks in advance,