Non Cash Payment to reduce Directors Loan Account

Accounting
1

How to put in QuickFile £16000 non cash payment on 31.7.2017 made to reduce Director’s loan?
It was declared to HMRC, but transaction was not done from current/credit account.
Thanks,

2

Hi @dan.l,

If the transaction wasn’t done from a current/credit account are you able to say where it has come from? QuickFile uses double entry bookkeeping so there always needs to be a balancing entry somewhere

3

I read in forums if you owe money to my company, the way to to reduce it is to pay dividend, on paid divided I have paid tax.

So virtually I withdraw £16000, and gave it back to the company.

How should I put dividend payment in quick file?

4

Is there any update?

5

Hi @dan.l,

The only way to post a dividend is from a bank payment. If you haven’t got a bank payment I am unsure how you would record this?

6

I have posted payments from time to time from current account to directors loan account, then on 31.7.2017 decided £13400 to convert in dividend payment, to reduce the loan.
Should I detag each payment from directors loan for example one of payments of £500 and tag as dividend payment?

If yes, once I detagged payment from directors’ loan and tagged as dividend payment ,it reduced directors’ loan for £500, what is good, but also reduced in [Chart of Accounts] Dividends Paid (3102) for amount of £500. Should it increase amount of dividend payment for £500? What did I wrong?

How to process with dividend of £16000 declared before 31.7.2017 for director’s loan payment before? I didn’t put in quickfile, but have reported to HMRC dividend payment, It doesn’t allow change as is locked. Should I unlock it? Will impact MTD or better not to unlock it?
Thanks,

7

Any update? Have to fill accounts

8

Hi @dan.l

It may be best to check with your accountant to ensure this is being recorded correctly.

There is general advice on how to record dividends in the knowledgebase, but your accountant would be able to advise on the best route to do this. If they can tell you what needs to be recorded, we could perhaps advise on how to do this in QuickFile.

1 Like
9

A journal will allow your accountant to reassign any balance on the ledgers. If you check with your accountant they should be able to post the correct journal.

2 Likes
10

You can enter a manual “money out” transaction on the DL account and tag that as a dividend payment.

11

If you declare a dividend, then you should post a manual journal to debit dividends paid and either credit the bank account (if you have actually paid the money out) or, in this case, credit the director’s loan account which should then reduce the amount you owe the company.
Give me a shout if you’re not sure how to do this - or as suggested ask your accountant to do it for you.