What is a trade creditor?
Definition of a trade creditor
A trade creditor is a supplier who has sent your business goods, or supplied it with services, who you haven't yet paid.
For example, if your solicitor sent you a bill for £300 on 1st March, and your cleaning company sent you a bill for £200 on 5th March, and you paid both these bills on 1st April, then on 31st March your business's figure for trade creditors would be £500.
The trade creditors figure will always show inclusive of VAT, because that is the amount you'll have to pay to your suppliers.
Keeping track of what you owe
FreeAgent's accounting software features an Invoice Timeline, enabling you to see which invoices have been paid, are due or are overdue - so you know what money you're owed and who you need to chase up.
Got questions? Ask Emily!
FreeAgent's Chief Accountant Emily Coltman is available to answer your questions in the comments.