If your business is a shop or a café, you might use a till. Here's how to deal with cash takings from a till in FreeAgent.
The best way to manage till takings is to open a second bank account within FreeAgent. Navigate to the ‘Banking’ tab at the top of the screen and select ‘Bank Accounts’ from the drop-down menu.
From the 'Bank Accounts Summary' page, select 'New' and choose 'Bank Account'.
Call it something like 'Till Account' and don't tick either the 'This is a Personal Account' or 'Make this my Primary Account' boxes.
At the end of each day, you should use this account to record your cash takings.
When recording sales, choose the appropriate rate of VAT (most commonly 20%), or enter the sales amount. If you sell goods with different rates of VAT then you have two options:
- Enter each day's sales as one total transaction, choose 'amount' from the VAT drop-down menu and fill in the amount of VAT you charged for all your sales
- Enter a separate transaction for the total sales you have made at each VAT rate. Your till's Z report should show you this.
If and when you bank the cash in hand into your business account, explain this as a bank transfer from your till account into your business account.
If you make any purchases for the running of your business with cash from the till, enter this as a payment from the till bank account, using the appropriate category. You can always set up more categories if you need to.
Reconciling your till account
Your aim is to make sure the figure in your FreeAgent 'Till Account' agrees with what is in the till at the end of each week.
Find out more about dealing with cash here.