I have 2 separate invoices on a supplier account that have been paid and tagged to 2 separate debit card bank transactions.
I have returned all the items relating to the 2 invoices and the supplier refunded them in full with a single debit card refund transaction.
For further information, I operate VAT on a Cash Accounting basis, and both of the original bank transactions were made in the previous VAT period (not yet submitted), and the refund transaction is in the current VAT period.
So far I have been unable to find a way of posting the refund and tagging the bank transaction, so could somebody advise me on how to process this refund and tag the bank transaction so as not to affect the VAT return?
As suggested I have posted a credit note for the value of the 2 paid invoices and have held the funds on account.
I am not sure if I am missing something, but I can’t log a payment against the paid invoices as they are fully paid and have been tagged, so I would have to delete the payments which would then de-tag the original bank transactions.
I now have a credit balance showing on the supplier account and the original money in transaction for the same value showing in my bank account.
I can’t tag the money in transaction to the supplier account as it says there are no qualifying purchases to refund against.
Am I missing something? or do you have any other suggestions?
You can’t tag the bank transaction as such, but if you manually create a credit note (create a new purchase assigned to that supplier and set the net and vat amounts to minus the total of the two original purchases, and the date to the date when you received the refund) and select the option to refund to your bank account, then it will create a new pre-tagged transaction for the same amount and you can simply delete the untagged one.