Could you please tell me what VAT codes should I enter on Sage 50 when recording journals for business expenses paid by director (the owner)?
Here are some examples:
1) When there is a VAT to be claimed:
DR Expenses account £50 - VAT code?
DR 2201 (Purchase Tax Control Account) £10 - VAT code?
CR 2301 (Director's Loan Account) £60 - VAT code?
2) When there is no VAT to be claimed:
DR Expenses Account £60 - VAT code?
CR 2301 (Director's Loan Account) £60 - VAT code?
I would be grateful for your help.
Thank you!
Replies (2)
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The answer is
For 1 - T1 for the expense and the 2201, T9 for the 2301
For 2 - T0 or T9 (depending on the expense item) for the expenses code and T9 for the DLA.
You will find it much easier to create a "bank" account to process all payments made by the director - Call it Paid by Joe Bloggs or similar.
At the end of each month you can process a single Bank Receipt (T9) to NC 2301 to clear the balance down to zero.