I’m new to Quickfile and I work through a vat registered ltd company and have very few expenses. I certainly never EVER have to invoice a supplier, but this seems the only way to categorise my expenses to enable me to claim the VAT back.
I have always just categorised my spend from the bank account. The first few I just put through as an expense and they are not categorised at all, so I need to work out how to untag them and start again. For the rest, I’ve just created a dummy supplier called Expenses and I stick everything to that, but it seems a bit excessive.
So your saying you’ve never ever received a receipt, or purchase invoice from anyone you have paid for goods or services from?
The purchase invoice section means you record details of the receipt you have received for paying for said goods or services.
You can tag a bank transaction and create an invoice at the time to record the payment against or you can create your invoice first and tag the transaction to it.
What you can’t do is just create a dummy supplier and tag everything to that, that’s not how vat accounting should be done and it certainly wouldn’t allow you to produce any meaningful accounts to submit your tax returns.
Reciepts, sometimes. But I never ever have the need to create an invoice. My expenses are things like train tickets, hotel rooms, laptop, mobile phone, stationery. That’s it. Everything is always paid for there and then on my debit card.
When you buy a laptop you get a receipt, when you pay for a hotel you get a receipt or invoice.
Payments can take around 2 days to clear so you’d have an invoice dated one day and a payment registered a few days later. That’s why you should record the receipt and then tag a payment to it.
I do understand all of that. Usually, if I’m working away I will claim back subsistence. I’m not going to create an invoice for every single sandwich shop I use. I buy my lunch with my debit card. It clearly comes through as Starbucks or Jim’s Cafe. It’s got just as much info as a till receipt. When it comes through my bank upload, I simply want to tag it as Subsistence and move on. I’ve done that with Crunch Accounting and Freeagent and it’s fairly simple. I know it’s probably just slightly different on Quickfile, so I’m just trying to work out how.
That’s slightly different question though. Something like subsistence is a flat rate allowable expense.
So you’d create a journal for the subsistence nominal and matching entry for either proprietor drawings or directors loan account depending on whether your a sole trader or Ltd company.
Then when you pay for food you’d again tag it to the proprietors drawings or directors loan account.
The subsistence category would be recorded on the profit and loss.
Things like real business expenses need to have the payment tagged to an expense. Yes in theory you can create one supplier for all but pick the correct category for each one.
Subsistence is a real business expense. If I’m staying away for business purposes then I will claim for my meals and hotels as an expense. There’s no flat rate allowance for that. Anyway, thanks for your help. Appreciated.
It is perfectly fine to tag small “out-of-pocket” expenses such as subsistence without creating a supplier invoice. You just select “something else not on the list” and choose the correct category. As long as you have a proper VAT receipt you can claim back any VAT there may be, although there is often no VAT on subsistence and none on train travel anyway. Do you use the receipt hub? You can upload your receipts directly to QF so you have everything filed.
Subsistence does not have to be a flat rate - you can reclaim the actual cost of lunch, etc.
For larger purchases, such as laptops etc. you should add an invoice
I’d not recommend doing that if you’re VAT registered.
You can post all these small invoices to a generic supplier or the DLA even. As long as you keep the receipts for auditing you don’t have to upload them all, but it is often easier in the long run as you don’t need to keep loads of random receipts filed for years. I think there’s a happy medium here, the replies so far are doing it to the 2 extremes.
That’s what I’ve done. I created a supplier called “Expenses”, but I just wanted to check whether I wasn’t misunderstanding how Quickfile works. I had tagged my first few as “something else” but then noticed there was no VAT option.
I was only suggesting doing it for small items like a sandwich or train ticket - not for everything! For these items, you are not required to have a full VAT invoice, so it is perfectly acceptable not to create a purchase invoice (as these get posted to creditors and you don’t have a creditor for these type of expenses). However, I hadn’t appreciated that there wasn’t a VAT option doing it this way (I am not VAT-registered) so in that case, yes any time you are reclaiming input VAT you would need to add as a purchase invoice and as you are doing, a generic supplier is fine.
This is not the best approach either but appears to be the workaround needed.
The problem with doing it different ways for different items is you’re not really making anything simpler, you’re doing more work and possibly making the entry more error prone. Using supplier invoices is generally the correct way to do things.
Something else not on the list is exactly that, for things that don’t already have a button or method, but purchases already do have an option on the list.