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uleytax
May 31, 2019
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How do I account for the charges made by the card company when the customer pays me using a card? E.g the invoice is for £100 and I receive £99, with £1 being the fee?

  • May 31, 2019
  • 1 reply
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Original commenter did not share additional details
Best answer by TaliaI

Hello uleytax,

 

Welcome to the Community - thank you for your question!

 

To account for fees, follow the below instructions:

 

1. Create the invoice for the full amount (fees included, say £500)
2. Receive payment to Undeposited funds (full amount)
3. Plus sign > Bank deposit
4. Tick the invoice on the top part
5. On the bottom where it says Add deposit, choose the same customer
6. Choose an expense account (say Fees)
7. Enter the amount as a minus figure (say -15)
8. Now the deposit should be for £485 which is the amount they've received, and £15 should be on the fees account as the fee (edited)

 

 

Please let us know if you have any further questions.

 

Thanks,

 

Talia

1 reply

T
TaliaIAnswer
May 31, 2019

Hello uleytax,

 

Welcome to the Community - thank you for your question!

 

To account for fees, follow the below instructions:

 

1. Create the invoice for the full amount (fees included, say £500)
2. Receive payment to Undeposited funds (full amount)
3. Plus sign > Bank deposit
4. Tick the invoice on the top part
5. On the bottom where it says Add deposit, choose the same customer
6. Choose an expense account (say Fees)
7. Enter the amount as a minus figure (say -15)
8. Now the deposit should be for £485 which is the amount they've received, and £15 should be on the fees account as the fee (edited)

 

 

Please let us know if you have any further questions.

 

Thanks,

 

Talia

J
johnsweet
January 15, 2020

Hi Talia

I am trying to do the same thing that the person posting has asked how to do.

I have read your reply but I think I am missing something.

If you could break it down for me (even more than you have very kindly done)
If I can start with steps 2 and 3
So number 2 -  Receive payment to Undeposited funds (full amount)
What/where is "Undeposited funds"?

And 3 - 
3. Plus sign > Bank deposit
Don't even know what this means I'm afraid.

Hope you can help.

R
RCV
January 15, 2020

Let me provide some information about Undeposited Funds and Bank Deposit, johnsweet.

 

The Undeposited Funds account uses to hold invoice payments and sales receipts that you'll want to combine. It acts like a lockbox (or drawer) you keep payments in before taking them to the bank.

 

On the other hand, the Bank Deposits feature uses to group payments together into a single bank deposit record.

 

To learn more about Undeposited Funds account and Bank Deposit, please refer to these articles:

 

I've got another option on how to handle the account for the charges made by the card company.

 

Here's how:

  1. If the transaction is showing in the Banking page, just go ahead and click on the  payment.
  2. Hit Find match.
  3. Tick the invoice that matches the downloaded payment transaction.
  4. On the Payment column box please enter the full amount of the invoice.
  5. Then at the bottom of the page, you'll see the RESOLVE DIFFERENCE option, just click on that link and it will create a new line at the bottom.
  6. On the category box please select the BANK CHARGE Expense account and enter the fee amount with a negative sign.
  7. Choose NO VAT and Save and close.

Once done, go to the customer's transactions list and open the invoice. It will marked as Paid and Close. Then, go to the Chart of Accounts and locate the Bank Charge expense account, you'll see the bank fee that we do Resolve Difference earlier.

 

For more details about matching downloaded transactions, you can check out the Add and match downloaded bank transactions article.

 

Fill me in if you need a hand preparing your year-end report or any QuickBooks Online related. You have a good one.

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