Previous year Employment Allowance refund

Morning

I have received a refund to my bank account from HMRC of Employment Allowance for 2020-2021. How do I record this in my 2021-2022 accounts?

Thank you. 

  • It depends whether or not your 2020/21 accounts have been finalised.  If so, and your accountant knew about this, it's likely there's a provision sitting in Accrued Income or Other Debtors (11__ code) or possibly in the HMRC/PAYE control account.  If so, post the refund you've just received as a Bank Receipt to that code to reverse it. (If the amount differs, ask your accountant).

    If the accounts haven't been finalised, post a journal dated for the last day of your financial year, debiting Other Debtors and crediting the P&L code for Employer's NI. Then post a Bank Receipt (dated in the current year as per your bank statement) to the same code.

    If the 2020/21 accounts have been finalised but your accountant did not know about this, so there is no existing provision, just post it as a Bank Receipt in the current year to the Other Income code and make sure the narrative is clear so your accountant can pick it up at next year end.