Hey all,
Apologies if this has been covered and if this gets a little waffly.
As simple as it seems, I'm failing to find a discussion that actually comes to a conclusion on how to address this all within quickfile.
One aspect of my business is being an agent who collects fees on behalf of a client and I would like some help on how to record this all.
The fee owed to my client is deposited into my client account. I then calculate a percentage for commission, transfer that value to my main current account and pay out the remainder to my client. I raise an invoice for my commission and send it to my client.
Previously I wasn't creating invoices through accounting systems so it was easy to record this by tagging deposits and transactions to/from a dedicated liability account titled "Deposits due to XXXX" and just creating Journals. I could show that I've made commission in a sales nominal account easily and whether I owe them or they owe me based on the liability account which I found useful for end of year accounts.
I became VAT registered on 1st NOV so decided to centralise everything to make life easier but it seems like it's gotten a little tricky to get my head around now.
I do have an agent myself who must have a solution but I thought I would ask here first.
My main issue is that I cannot log a payment against the invoice I raise to my client as there is not an external movement of money from my bank to just tag it.
I don't want to pay out the full amount received to my client and then ask for some back just so I can tag the transaction to show my invoice as paid. The whole point is to make it easy for them.
I thought about creating the invoice and then logging against it a credit note however I am not convinced this is the best way to do it as surely the credit note cancels out values recorded in the ledger accounts. It also zeros any VAT recorded that I would be due to pay HMRC? Correct me if I'm wrong.
So to summarise, I just want to know what the best way to do this is so that my invoice shows as paid, my commission income ledger/nominal account shows I have had some income from my client and the VAT is recognised for sales tax that I will owe.
I see myself going back to spreadsheets to make this all work and just creating these specific invoice externally which is what I want to avoid.
I hope this all makes sense.
Cheers
Will