Record credit card transactions

Summary

How to create a special bank account to track credit card transactions in Sage Accounting.

Resolution

We recommend that you create a special bank account to track credit card transactions. This will also help you track spending on credit card.

Some credit cards also have a bank feed. Linking your credit card to a bank feed will allow you to automatically import transactions directly from your credit card and ensure your transactions are always up to date.

What you need to do

To record credit card transactions, we recommend that you:

Create a bank account to manage your business credit card. Make sure you also enter your opening balance. This is the balance of your credit card when you start entering transactions into Sage Accounting
Optional - create a new ledger account for credit card charges and interest, to keep them separate from other bank accounts. If you're happy to record charges and interest for all bank accounts in a single ledger account, miss this step and record the interest and charges when you reconcile the account
Reconcile the credit card transactions in the bank account when you receive a statement

Create a bank account for your credit card

From Banking, then click New then Bank Account.
For the Account Type list, choose Credit Card.
This adds a credit card icon to tile to help you identify it.
Enter an account name to help you identify this as your credit card.
Enter the remaining details if required.
Click Save.

Enter an opening balance

It's likely that you will already have an amount on your credit card. You now need to enter this as an opening balance to make sure your balances match up.

Connect to a bank feed

Choose Save and Connect Bank to connect directly to credit card account with the bank.

Once connected, import transactions directly from you credit card account. This will:

save time as you no longer have to enter transactions manually
make sure you only record transactions cleared by your bank
make sure your credit card balance is up to date
speed up reconciliation, as imported transactions are marked ready to reconcile

Create a ledger account for credit card charges

If you haven’t already, create a new ledger account to record the amount paid in charges and interest on your credit card.

Go to Settings, then in Financial Settings, select Chart of Accounts.
Select ledger account and complete the following information:
- Name - give the ledger account a name such as credit card charges.
- Display Name - this is just the name to show on reports and lists.
- Code - give the ledger account a code. If you're using our default chart of accounts, we recommend that this is between 7000 and 7999, such as 7901.
- Category - choose Overheads. This is to make sure the amount is reported as an expense on your profit and loss report.
- VAT Rate - choose Exempt. VAT is not applied to bank charges and interest.
- Visibility - leave the defaults as selected. This just determines which transactions the Ledger accounts can be used with.

Click Save.

Record payments made with your credit card

If your credit card is not connected to a bank feed, you'll need to manually enter your credit card transactions.

Or, alternatively, consider importing them from your credit card statement.

If you're paying a supplier invoice, use the Supplier Payment option. This allows you to match the payment with the invoice.

For other expenses, use the Other Payment option.

From Banking, open the credit card account.
Choose New, then Purchase / Payment.
1. To pay a supplier, select Supplier Payment.
2. For any other payment, select Other Payment.
Enter the details of the payment:

You must enter the

Bank Account
Date Paid
Amount Paid
Ledger Account - choose a ledger account to categorise what you've bought, such as office supplies
Details
VAT rate and VAT if applicable

If the payment was for several items relating to different ledger accounts, or with different VAT rates, enter these on separate lines.

Don't forget, the total value of all the separate lines must add up to the total value of the payment.
Click Save.

Optional - record credit card charges and interest

When you reconcile your credit card statement with Sage Accounting, if you want to record your credit card charges in separate ledger accounts, enter them as an Other Payment.

Otherwise you enter the charges when you reconcile.

From Banking open the credit card account.
Select New, Purchase / Payment then choose Other Payment.
Enter the details of the charges or interest.
Paid from Bank Account - choose your credit card account.
Method - the Credit Card option is probably the most relevant.
Date Paid.
Ledger Account - Choose the ledger account you have just created for credit card charges.
VAT Rate and VAT - choose Exempt.

* These details are compulsory.

Transfer money to pay your credit card bill

As you use money from another bank to pay your credit card bill, record this using the Bank Transfer option.

From Banking, choose New, then Bank Transfer.
Enter the details of the transfer and Save. You must enter the following:
- Paid from Bank Account - the bank account you paid your credit card from
- Paid into Bank Account - your credit card account
- Amount Transferred
- Date Transferred

Record a refund on your credit card

If you've been refunded some money on your credit card, you'll need to record this too.

If your credit card is connected to a bank feed, you cannot record the refund directly from bank feeds. Discard the refund from your bank feed, then enter it manually.

Record a money in refund

From Banking, open the credit card account.
Select New, then Sale / Receipt.
Choose Other Receipt tab, then Enter a refund for a purchase link.
Enter the details of the refund.

Record a money out refund

From Banking, open the credit card account.
Select New, then Purchase / Payment.
Choose Other Payment tab, then the Enter a refund for a sale link.
Enter the details of the refund.