A client has paid me the same invoice twice and its causing a bit of a headache.
I log my CIS in a virtual bank account on QF, as described by QF on CIS bookkeeping.
The problem I have is that the client has paid me in a lump sum for about 5 invoices, but 1 of the invoices was already paid in the past.
I have logged all the outstanding invoices as normal against my virtual CIS account (tagging the bank feed amount between my bank feed and into my CIS deductions acc.) but the remaining amount of the overpayment is sitting as a negative on my CIS acc. as its not a correct payment.
how do I log this overpayment so that my virtual CIS account reads zero and tag this correctly.
I plan on refunding the client, but due to way i log the CIS payments it seems like a bit of a mess and not sure at all on how to handle it.
If you’ve logged all the payments and CIS deductions for the outstanding invoices correctly, then when you refund the overpayment that should just be ok to tag as a bank transfer from current account to your virtual CIS account. You’re not crediting them for anything, you’re simply returning money that they hadn’t owed in the first place.
To put some concrete numbers on it, suppose you had four outstanding invoices for £100, £100, £200 and £125 gross, and a past invoice for another £125 that they’d already paid. They just paid you 80% of all five of those (after making CIS deductions), so a total of £520.
You’ve marked £525 worth of invoices (the four outstanding ones) as paid in full into the virtual CIS account, and recorded money out of £105 for the corresponding CIS deductions, leaving the CIS account with a balance of £420. Then you tagged the £520 payment as a transfer from CIS to current account, leaving the CIS account at -£100.
That £100 is exactly the amount by which your customer overpaid you (80% of the old already-paid £125 invoice). When you return the overpayment to the client, tagging the £100 out of your current account as a transfer to the CIS account will get everything to balance nicely.