when i receive a cheque i normally want to mark the invoice as paid, but that isnt always the same day i actually lodge the cheque. if i mark the cheque as paid into my current account that might cause problems because i have no record of whether i actually ldoged it or not, so if it isnt on my statement i may not remember whether or not i lodged it. how do peoplehandle this? do they create another account and show the cheque going into that one until it’s lodged?

Hi Mike,
So the basic’s of accounts is that your bank account matches your accounts, this is done through a bank reconciliation (reconcile bank with accounts), they must always match.
It depends on what you want. Here are all the solutions. 

1. The best thing to do is just lodget the chq and run a bank rec to mark the invoice as paid. It’s not paid till that money is lodged in the bank, this removes issues around bouncing chq’s messing up your vat return. 
2. To mark an invoice as paid you need to select a bank account. So you could just keep using the normal bank account and lodge the chq there all the time. Then when you go to reconcile everything will match. The dates are 100% important once they don’t mess up your bank vat etc. It’s a risk as banks can take 5 working days to clear chq’s.
3. Present your bank account on your invoice and and note to the client saying you’d like to be paid for by bank transfer. 

Hope that helps.

Pete