You'll need to create an equity or income account and deposit the claims from there. I'd be glad to guide you through the steps.
Before doing so, I recommend getting in touch with your accountant for guidance on which account to use. This way, we'll ensure the accuracy of your books after recording this.
In your QuickBooks Online (QBO) account:
Here's an article you can read for more details: Add an account to your chart of accounts in QuickBooks Online.
Once done, deposit the claims to the account you've just made. Here's how:
Furthermore, here's an article you can read for more detailed steps: Record and make Bank Deposits in QuickBooks Online.
Additionally, I got you this great article that you can read for future reference. This resource provides detailed information on reconciling your accounts accurately: Reconcile an account in QuickBooks Online.
You can always get back to me if you have other queries. I'm always here ready to answer them. Keep safe and more success in your business!
Thanks for the reply. I was going to create an Income Account as the Government website suggests to do this. However, I just wondered how it reconciles against the payroll amounts as I assumed you'd want to see the corresponding entries in and out of the accounts. However, in Payroll Expenses the amount just shows as 'Wages" rather than the Other Payment of 'Furlough Employee Pay' which I created during payroll. I suppose it all tallies up at the end of it but I just wasn't sure.
I also wondered what VAT code to put with the receipt received from HMRC. Whether it's an Out of Scope entry or something to show VAT even though we didn't invoice etc.
Thank for your help.
Thanks for your reply, Regarding the Furlough refund from HMRC for your furloughed employees if you have recorded the wages as wages expense it would usually be the case of recording this as income. We have outlined the steps on how to create a new income account and also how to add the income to that account in the previous post. It is a case of reflecting in QuickBooks Online what actually happened in real life. Meaning had you already processed the wages expense before receiving the money from the claim? Which from your comments we can see you have. We would advise speaking to an accountant to confirm they are happy for this to be recorded in this way as we're not trained accountants.
The VAT code to use when accounting for this would be NO VAT as it really falls under a refund from HMRC
Yes I just followed the steps to do a furlough payroll and did our claim to HMRC at the same time.. so we received it a bit later. Just set up 'Furlough Pay to Employees' as an 'other payment' within payroll as those were the steps explained to do. However, in our P&L etc it just shows as Wages within Payroll Expenses. But yes, thank you for the response and for your help.