I get a few projects via a website which subsequently takes a commission on anything I earn. I want to deduct their commission on my sales invoice because this means I have to pay less VAT on the earnings. I have figured out which journal to assign the commission to but my question is about the amount. If I don’t record it as a negative amount then it’s ADDED to the invoice instead of subtracted. However it’s not very logical to enter a negative amount in an expense journal?
When you record the customer receipt, split the transaction and change the amount received on the first line to match the amount on the sales invoice then enter the commission amount on the second line as a negative and allocate it the your commission expense account. The sales invoice amount minus the negative amount allocated to commission will equal the actual amount received, leaving no accounting anomalies.