Customer owed large debt. Written off as bad debt in last tax year. Now has made contact and want to repay at 100pm. How do I re- instate the write off in sage or show this payment being made without leaving customer ledger in credit as obviously now showing as clear as debt written off
Also at year end how do I account for for paid bad debt on p l
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Record income as it is received
Last year was correct, based on the information you had to hand at the time.
You don't know how long this arrangement will go on, so I would record each receipt as miscellaneous income in the current year - dealing with VAT if appropriate at 1/6th of the total.
This should be posted via cashbook - no need to create a customer account. I presume you won't be offering this customer trade credit any time soon.
As above
But more specifically I would post the receipts to a bad debts recovered account, either within other income or netted against the bad debts account.