How do I contra prepayments on sales and purchase ledger for same client as there are no invoices to allocate these payments against.
With contra-invoicing, you would need to use a holding account between the client and the supplier account. Assuming you already have the company set up as both a Supplier and a Client on your account, create a new bank account called “Contra-invoicing” or similar.
Then you would just enter the money in (from the client) and the money out (to the supplier) in this holding account, both of which cancel each other out.
Hope this helps, but please let me know if you need further help.
As both the debit and credit are prepayments on each account how do I tag these?
If you want to just write off the prepayment then you can refund this using a dummy bank account.
If you go into the client, you can View the payments:
You can then do an advanced search for all of those unallocated. That will bring up the prepayments on account. You then select the relevant payments by viewing them and then there is a refund option at the top of the screen:
You can then select the dummy bank account to contra off the refunds.
Hope this helps
Thank you for your help
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