Recording a deposit paid to a supplier

Hi @Charlie19,

We can treat this as a refund from your supplier due to an overpayment. We'll need to create 3 transactions, which is a bill, a supplier credit and then a cheque.

First, we create the bill transaction with the £60 amount. Take note of the expense account you use in this transaction because that would be the same expense account we'll use in the supplier credit transaction later on.

Next, we record a supplier credit with the amount returned to you (£20).

Lastly, we create a cheque transaction to link both the bill and the supplier credit. This cheque will automatically convert into a bill payment.

1. From the + New menu, select Cheque.
2. On the Payee drop-down menu, select the supplier in question.
3. There will be a popup window on the right-hand side. Click Add on both the Bill and the Supplier Credit.
4. Click Save and close.

Recording these 3 transactions means that you've created a £60 money out transaction, but only paid £40 due to the £20 supplier credit. You can then exclude those 2 transactions in your bank feed at this point. There's no need to worry since your QuickBooks bank balance is still accurate.

You can view this article for more details about managing supplier credits and refunds: How do I handle supplier credits and refunds?

Feel free to comment below, in case you have other questions. I'll be sure to get back to you.