How do I record a bounced payment?
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Kat_8679893
Member Posts: 29 ✭
I paid a supplier, to their old bank account, paying off the original - our bank returned it - then I repaid the supplier...but now I have no invoice to put it against.
So how do I record the returned funds from our bank and the repaying of the supplier?!
So how do I record the returned funds from our bank and the repaying of the supplier?!
1
Comments
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06/04/17 Hi Kat, Does your bank statement show these two transactions? a) The funds deduction for the original payment b) The funds addition for the refund of the payment0
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Yep, shows 3 - original payment, refund, then repayment0
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My suggestion would be to do the following
For the original payment, i'd enter a payment that isn't linked to the bill. The payment would use the same items or account that are used in the bill.
For the refund, i'd enter a payment that isn't linked to the bill. The payment would use the same items or account that are used in the bill however this payment would use negative amounts. This would basically reverse the first payment.
For the third payment i'd pay the bill as per usual.
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Hi Kat, it's also important to know if you are on CASH or ACCRUAL basis for GST as the process may differ. Also, did you create a bill and then pay it (allocate the payment) or did you enter the bill and pay it in the one transaction?0
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Jason makes a good point.
If you wanted one of the payments & the associated refund to be excluded from tax & tax reporting then one suggestion might be as follows...
For the refund, you could enter a journal
* Line 1 - credit 'Accounts Payable' for the applicable amount & also select the supplier on this line
* Line 2 - debit the applicable bank account
* Add a relevant description into the journal explaining that this journal relates to a bounced payment refund.
For the payment, you could enter a payment that is linked to the journal. The journal will be available in the 'Allocate' tab of the payment. Add a relevant description into the payment explaining that this payment is associated to the journal.
The other payment would be linked to the bill as per normal.2 -
Thank you for putting it down step by step, helps a lot as I'm not a trained bookkeeper (if you can't already tell!)1
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