Record unpaid share capital
This article explains which journal entries are required to record unpaid share capital in FreeAgent.
Please note:
- You need full (level 8 access) to your FreeAgent account in order to create journal entries.
- The person who is being allocated the shares must be added as a user.
- There must be no active account locks in place covering the period in which the shares are being allocated.
1. Create journal entries
Navigate to the ‘Accounting’ tab at top of the screen and select ‘Journal Entries’ from the drop-down menu.
Select ‘Add New Journal Entries’ in the top-right.
Let’s say you have £100 of Unpaid shares. You’d need to enter the following journal entries:
- Debit ‘910 - Unpaid Shares: user who holds the shares’ £100
- Credit ‘901-X Capital Account: user who holds the shares’ £100
Select ‘Create New Journal’ to complete the process. If you’re unsure which journals are required, please speak to your accountant.
2. Explain the payment for the shares
If payment is received for these shares at a later date, you can explain the payment as ‘Money Received from User’ as the transaction Type and ‘Payment for Unpaid Shares’ as the Category.
Select ‘Explain transaction’ to complete the process.