SageForum for UK versions of Sage 50- Help and support.

After setting up all the necessary RCT witheld tax nominals etc and carrying out the process could anybody explain how to account for the event when the monies paid direct to Revenue/HMRC by the principal contractor rather than being repaid to the sub contractor by Revenue / HMRC are actually used to pay PAYE and National Insurance direct?
Although the sage accounts package process is correct at the end of the year the nominals for these items are still showing the payments owing to Revenue / HMRC even though they have been paid from the RCT Witheld?

I know little of Irish Taxation.

Sage V10 was released 9 years ago so a bit rusty there too.

But I will try and help.

This is what I think is happening and you should be doing.

You are a sub contractor, a supplier has paid part of an invoice amount to the revenue.

Example process:-

You invoiced the Customer €120
You record the receipt of the amount paid €100 on the customer account and the bank
You recorded the tax balance to a balance sheet account set up for the purpose (I imagine account no 22xx) €20 (There are lots of ways people do this, I like credit notes, it doesn't really matter which method you use, the end result should be the same)
The customer account now has a balance of€ 0
Your bank account has got €100
Tax account (22xx) has €20

You generate a tax liability (PAYE-NI) which you post to the balance sheet as part of your wages journal, say €32 (2210) (some detail the split between 2210 and 2211)

The €32 owed to the revenue is reduced by €20 and you pay €12 which you post against 2210.
You now journal the withheld tax that you used to pay the tax bill form 22xx to 2100.
the accounts now have a zero balance and all is reconciled.

Once again Bruce you have saved the day. Many thanks. One day I will upgrade the software but all the time it is doing what I want why fix what isn't broken?