Hi AJ1603 Thanks again for confirming. I presume at some point the insolvency practitioners may require the funds to be returned? If this is the case then you may not want to include the amount as income and allocate it to a liability account.
To account for the payment received to a liability account you would:
select accounting > chart of accounts > new > account type will be current liabilities, if the amount is to be paid back within 12 months, if not Non current liabilities> in the detail type select current liabilities, if the amount is to be paid back within 12 months, if not long term borrowings > enter a name e.g. Insolvency Amount > save and close.
create a bank deposit; select New+ > bank deposit > in the account field in the top left ensure you have selected the bank that the amount was received to and the corresponding date in the date field > in the received from column, within the 'add funds to this deposit' section, enter the name of the person that lent you the amount, however this is not mandatory > in the account column select the liability account and in the amount column enter the amount that was received > in the amounts are field select No VAT.
When you pay the amount back, or a proportion to the bank/it is deducted from your account you will:
create an expense; select the New+ icon > expense > Enter/create the insolvency company as a supplier in the payee field> in the payment account select the bank account the amount is being paid from > in the date field select the date the amount was debited from your account > in the category column enter the liability account you created earlier > enter the amount of the loan in the amount column > in the amounts are field select No VAT > save and close
Please note that we're not accountants therefore we recommend that you qualify the above with an accountant.
