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I assume the voucher is a CIS25 and you are doing bookkeeping for someone in the construction industry.

The voucher is a receipt for a payment to HMRC for tax liability, (made through a third party) and can be offset against any tax due at the year end.

I would create a balance sheet account to record all these payment to HMRC so that at year end they can be offset. If you have a tax provision account, I would create it adjacent to it.

The link below gives you more information about CIS

http://www.hmrc.gov.uk/leaflets/ir117cis.htm

Erm, I'm afraid youve lost me - I havent come across these before. My client is not vat registered but when I post his invoice on the customer ledger how do I post the vouchers which he has included in the body of the invoice. Sorry to be so dense but remember its only easy if you know how to do it.

If he has invoiced someone £118, they will pay him £100 and give him a tax voucher for the other £18.

They give the £18 to the tax man and he deducts the £18 from his tax bill.

The invoice is as normal, probably going against account 4000 - Supply of labour

The way to dealt with the tax voucher is to raise a credit note on the account for the unpaid part of the invoice posted against a suitable balance sheet account to represent tax paid.

The account is then settled with the actual payment.

If you are using standard Sage nominal ledger then the balance sheet account would be 2215 - Tax Vouchers.

Hope this makes sense

Thanks Bruce, I knew we'd get there in the end. I'm not really thick you know

I think it is easier if you have an example. I hope it is clear to you now.