Debt recovery less debt collection fees

[Jacquiemieg]

Hi,

We used a debt recovery firm to recover a long outstanding debt, we received payment less the fee which they charged us

Debtor owed $5000

Debtor made part payment to debt recovery firm of $1817.92. Payment to us was reduced by $333.94 for fees and charges

We received a payment of $1483.98 

How do I post the payment to clear the $1817.92 from the debtor account and also pay the $333.94 fee we were charged by the creditor

Quite confusing really

Thanks for your help

[Steven_M · Accepted solution]

Hi @Jacquiemieg

Welcome to the MYOB Community Forum, I hope you find it a wealth of knowledge

I assume there are a few different ways in which you could do that, I would encourage you to speak to an accountant however below is the way I would resolve that situation:

1. Create a new contra/holding account to do this go to Accounts>>Accounts Lists>>New - Give the account a number, name and set the account type to be Bank. 
2. Once that account has been created, generate the necessary deposit transaction into the bank account with the allocation account being the holding account being reduced by the fees from that debt company. For example a Recieve Money similar to the following:
   
   
   
   
3. When that transaction has been paid, you would record the necessary transaction to show that a payment has been made on that invoice. For example a Receive Payments transaction similar to the following:
   Note: The Deposit to account on that transaction is the Contra account and it is for the full amount of that payment (made to the collection agency).
   
   

[Jacquiemieg]

Hi Steven

Thank you for the welcome, this site really is a goldmine for information, your solution has solved my issue, thank you so much for your help, it is pretty clear when explained in terms I understand

Thank you