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VAT Code for Bounce Back Loan Repayments?

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Just wondering what VAT code to use against our bounce back loan repayments that have started? Also wondering whether I need to be showing any interest elements of the repayment separately within the payment? I have the loan as a liability account on the balance sheet and obviously overall we will be paying back more than we received? Thanks

QuickBooks Online

paul72Answer

Hi @kendal-sharp

The loan & repayments are outside the scope of VAT - so NO VAT code.

As for the interest, I'd post that to a separate expense account (there's a standard Interest Paid option inside Expense when you go to New in the Chart of Accounts).

Each repayment can be split on two lines - one going to the liability account, the other going to interest expense.

Hope that helps.

paul72Answer

Hi @kendal-sharp

The loan & repayments are outside the scope of VAT - so NO VAT code.

As for the interest, I'd post that to a separate expense account (there's a standard Interest Paid option inside Expense when you go to New in the Chart of Accounts).

Each repayment can be split on two lines - one going to the liability account, the other going to interest expense.

Hope that helps.

K

kendal-sharpAuthor

Amazing, thought that was the case :)

Thank you!

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