Using 'Cash basis' with Quick File


I have a quick question regarding cash basis and Quick File. To make the question clearer, I thought it’d be easier to provide a bit of background info…

I set myself up as a sole trader with a business bank account a few months ago as I had the opportunity to do some odd bits of work here and there in my spare time; I’m also employed full time.

My business is purely service based and doesn’t involve any stock, just my time and the only ‘purchases’ are expenses like the use of my personal car to visit customers and any stationery using the simplified expenses scheme. To keep things even simpler, I’m not going to claim the use of my home PC and printers etc. as it’ll be too difficult to work out the percentage that’s used by the business, so I’ll take the hit on those.

As it’s such a simple business model, I’m going to be using ‘cash basis’ to work out income and expenses. I’m only dealing with a small amount of customers, who generally pay by cheque or bank transfer into the business bank account. However, one of them likes to be invoiced on the day I do the work which is fine except that they only pay once they’ve received the money from their customer which can be up to 60 days.

I need to run my year end on Quick File, but I have one invoice that showed as unpaid. Since then, it has been paid, (but in the new financial year) and I’ve updated the invoice to reflect this. I can’t see any way of setting up my account on Quick File to use the cash basis method, so if I run my year end, won’t that count the invoice that hadn’t been paid? My bank account balance at the end of my financial year won’t match Quick File if the unpaid invoice is being counted as it would on a normal accrual basis.

Is there any way around this apart from changing the date on the invoice until after my year end, (although that won’t match the one sent to my customer)?

Any help or suggestions would be greatly appreciated. Thanks!

Hi again,

I notice there have been quite a few views and I’m wondering whether my only option is to change the date on the invoice, (if that’s possible), print it and makes some notes as to the reasons why it’s different for record keeping purposes. Does anyone else use Cash Basis with Quick File or have any other ideas?


Hello MDSPC and all,

My case is very similar, me too, I would greatly appreciate any suggestions!

The cash based income tax has been introduced only one year ago, we are probably some of the few early birds?


I run a sole trader gardening business where my model is almost identical to that of mdspc (i.e. cash based). I closed my first year end in QF at the end of March 2014 but at the cut of date (31/3/14) I had several sales invoices outstanding. I also run ‘T’ accounts in an excel spreadsheet (to virtually run in parallel to QF). Quite simply, where you have unpaid invoices, just record the amount as debtors in the balance sheet at the year end or, whilst any unpaid suppliers show as creditors.

Hi Philip and Gardenman,

Thanks for the feedback and suggestions. What I decided to do, which I hope is an acceptable workaround and won’t cause me any problems in the future, is, I edited the date on the outstanding invoice by a few days so it’ll appear in the new financial year, which is when it was actually paid because I noticed that Quick File would allow you to add notes against the invoice itself, which I did in detail, showing the original date the invoice was issued, what it was changed to and why, along with the date it was paid, so that if it’s ever queried in the future, I’ll know exactly why I did it.

I’m assuming that’s going to be ok and it’s acceptable to do this as the business works on the cash basis method.

What would be a great addition to Quick File in the future is if there was an option under the company settings, maybe a checkbox, for ‘Cash Basis’ accounting. If ticked, this would mean that invoices that have been issued to customers would only be included in the financial year if they’ve been updated to a status of ‘Paid’.

If anyone thinks that my Quick File workaround of changing the date of the invoice, regardless of the notes, is going to cause me issues further down the line, I’d be grateful if you could let me know. My wife is a bookkeeper and she seems to think it’ll be fine as long as I’ve documented the reasons for the change in date, but it would be great to hear from other people with experience as it’s all very new to me!

Thanks again! :smile:

Hi to all, the system had calculated and shown the invoice to customer in correct manner, even though it is cash basis you did offer the client to pay over set payment terms and therefore this is correctly shown as a debtor outstanding.
Good luck with your year end.

As this topic is about to automatically close, I just wanted to say thanks to Philip, Gardenman and DonnaCBK for your feedback and help, it’s very much appreciated. I’m going to do a bit more research to fully understand what needs to be done when using cash basis with invoices that have been issued before the year end and payments received in the new financial year before attempting to run my year end.

Thanks again! :smile:

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