I've recently started keeping the books for a small school which claims VAT refunds using the VAT126 form. So far, so simple.
Usually, when a refund is received it is credited to "VAT Control", then a journal is entered to transfer the bank payment to "VAT HMRC Control Account". However, I've spotting that for a refund of circa £7k received in the last financial year (Sept 2016-Aug 2017) no journal was entered and as a result the VAT HMRC control account is incorrect. I can enter a journal to reduce the refunds to be claimed from HMRC (credit VAT HMRC control account) but not clear which account to debit?