Hi,
I have some questions regarding payments to suppliers on account.
I am on the cash accounting scheme for VAT payments, and I have some suppliers who I have 60 day terms with. They send me an invoice straight away and I will pay it within 60 days.
I have created an account called wholesalers under the same liability group as the credit card accounts and have been creating a purchase invoice when the invoices come in from the suppliers. I have just realised though that it is allocating the VAT on the purchase invoice date, not the date I pay them.
I have tried recording it as a 'money paid out' transaction and this appears to do the same. Could you explain how I can achieve the recording of the transactions in the way that I need to?
How I would like it to work:
I require an account for each supplier (I assume it would be similar to the master card account) so that I can keep track of the amount I owe them
I need to record the invoice they sent me on the date they sent it, but not have the VAT recorded on that date.
I need to record the date I paid the above invoice (possibly 60 days later) and have the VAT recorded on this date.
At the end of each month they send me statement which will detail all of the invoices sent for that month.
Thank you for any help! Its been driving me mad trying to work it out.
Martin
Hi Martin,
To use the cash method click menu Setup > Contact Details & VAT > VAT Is Calculated: When Payments Are Received.
Solar Accounts keeps track of the money you owe to suppliers - this is shown in the Balance column of the Suppliers list. This is not exactly the same as the MasterCard account. Instead, the total money owed to suppliers is shown as Accounts Payable.
One other thing: does your supplier's invoice show details of the goods or services you are paying for? If so you should use an expense account on the purchase invoice in Solar Accounts.
Cheers
