VAT penalty posting on Quickbooks

VAT penalty posting on Quickbooks

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Hi,I need help as I am not very familiar with Quickbooks.
My company has to pay 2 penalties for late VAT payment.
How do I allocate the payment for these penalties?
Is a debit on my bank but what is the other side????do I need to make a journal?
please if someone can advice asap I would be grateful.
thank you.
Maria
Maria Liatou

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By AnonymousUser
25th Oct 2005 12:38

Cr Bank Dr Interest Charges - no invoice required
Hi Maria,

I assume that you already have a nominal code set up for Interest charges ?

If so, Credit Bank and Debit Interest Charges.

As this will be posted as a nominal payment, no invoice is necessary as you are not touching the Purchase Ledger.

As I am sure all future VAT payments will be sent on time, there is no point setting up new nominal accounts for every single eventuality (one of my pet hates with our Auditors), and I assume that your accountant will get a full split of all interest payments/receipts for the tax comp. so it will be easily identifiable anyway

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By AnonymousUser
25th Oct 2005 14:07

reply
interest charges???hm,never heard of that one.never even thought about it..now here is a debate.
Brian Vs Jenny.
Hm! I think I'll go with Jenny's proposal this time..
sozz...

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By AnonymousUser
25th Oct 2005 09:42

VAT
Hi Maria

Firstly, QB calls everything a cheque: be it a Direct Debit, BACS payment, cash payment, they are all "cheques". So it doesn't matter exactly in what form the payment took in real life.

You don't need to create invoices - as long as the double entry is there (which it will be) it is fine.

I would simply post the following:

CR bank
DR VAT penalty a/c

That should make it obvious to the accoutant/ auditor what the payment was. Just because it is a non-standard transaction, doesn't mean you have to do anything fancy with it, as long as the double entry makes sense.

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By AnonymousUser
24th Oct 2005 16:38

Quickbooks
Hi Maria

The simplest thing to do would be to Credit bank and Debit a new expense account called "VAT penalties." There might already be an appropriate expense account set up, in which case use that. As long as you put in a narrative of what it was, then the accountant at the year end will do the right thing with it.
Hope that helps.

Jenni

Edit: getting my DRs and CRs round the right way!! oops...

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By AnonymousUser
25th Oct 2005 08:54

question No 2
Thank you very much.
Quickbooks gives a help tip about it IF the VAT penalty was paid by cheque,but the answer it gives affects the VAT control account,something that sounds wrong to me! I paid penalties by BACS/Now if I need to create a new expense account for it I will need to post some dummy Invoices so I can reconcile payments against to..OR do I just post the payments and wait until year end for the auditors to decide what to do with it??
sorry for being a pain. I never had to pay any penalties ref:VAT but hey!it's always a first time!!
:-)

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