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T
TLC2024
January 14, 2025
Question

Best Practice for Allocating Customer Payments in Bank Transactions with External Invoicing

  • January 14, 2025
  • 1 reply
  • 0 views

We use a separate program for invoicing and payment collection, so we don't record invoices directly in QuickBooks Online (QBO). Each month, we create a journal entry to allocate income to the appropriate income accounts and account for HST on these sales.

When categorizing customer payments in the Bank Transactions section of QBO, what’s the correct approach? Should these payments be recorded as deposits to Accounts Receivable with a 0% tax rate, considering that the HST is already accounted for in the journal entry? Any insights would be greatly appreciated!

1 reply

A
Alex M
January 14, 2025

Hi there TLC2024,

 

Thanks for reaching out about your payments. QuickBooks online is a great tool able to help you keep track of sales and expenses so you know the profit of your company. I can point you in the right direction for assistance with entering this.

 

To enter these payments in QuickBooks to make sure they're affecting the books and those prior journal entries correctly,  recommend speaking to your accountant. Their expertise will be able to guide you in the choice of what transaction type to choose, as well as which accounts to affect. You can invite an accounting professional by clicking on the My accountant tab in QuickBooks Online and entering their details, or find an accountant near you by clicking the Find a pro to help button in that section.

 

If you have any other questions, feel free to reach out here.

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