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What is the best way to handle fixed direct debit payments to a supplier? I pay a fixed sum every month to my electricity provider, rather than pay a specific bill.
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Hi alan17
The best course of action would create a chart of account > Accounting > Chart of Accounts > New > Account type should be cash at bank and in hand > Detail Type should be Current In the Name call it Energy for example.
From the banking screen, where the direct debits are populating/or create manual expenses, in the category enter/select the bank account you have just created above> No VAT.
Then Create the bill you actually received from your utility company. Create icon > under suppliers select Bill > in the category column enter the utility expense account, enter all the other information including the actual amount of the bill and 20% S (20%) the date of the bill should be when you want to account for the VAT (if using accrual method of accounting), this should now reflect the actual bill, select the opaque save > make payment > in the Bank/Credit account select/enter the Energy chart of account you created earlier/above in the payment date enter the date you want to account for the VAT (if you are using the cash method of accounting) >Save and Close.
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