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▶ How Do I Enter a Refund From a Supplier?

Why Enter a Refund as a Negative Payment?

Despite a refund meaning money is coming into the council, it should always be viewed as the correction of an overpayment, not as a receipt. Entering it correctly ensures your financial reporting remains accurate:

  • Avoids Overstating Income: If entered as a receipt, your total end-of-year receipts figure will be artificially overstated.
  • Protects VAT Calculations: If VAT is included in the credit and incorrectly entered as a receipt, your closing VAT balance will likely be calculated incorrectly.
  • Maintains Code Consistency: Processing it as a negative payment allows you to allocate the entry to the exact same cost code as the original invoice.

How to Enter the Refund

When you receive a refund from a supplier, enter it into Scribe as a negative payment entry:

  1. Open a new payment entry.
  2. Allocate it to the same code used for the original invoice.
  3. Place a minus sign (-) in front of the values to create a negative entry.

⚠️ Special Case: VAT-Only Refunds In an instance where only the VAT amount is refunded, this must still be entered as a minus payment, but for the VAT amount only (leaving the net value as 0.00).

How to Reconcile it to the Bank Statement

  • Standard Matching: The negative payment entry will be reconciled just like any other transaction. Once the refund appears on your physical bank statement, the negative payment in Scribe can be ticked off.
  • Financial Impact: The negative payment has the exact same effect as a receipt (e.g., it increases your bank statement balance). However, it ensures that your total income and expenditure figures are not overstated at year-end.