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S
sina_jazayeri
October 15, 2023
Question

Setting up automatic rules for paying credit card payments

  • October 15, 2023
  • 1 reply
  • 0 views

Hi.  I import two accounts into Quickbooks, one is the Business Current account, and the other is the Business Credit Card.

The Business Credit Card bill gets paid out of the Business Current Account.

So I see an Expense say -£1000 from the Credit Card and a £1000 outgoing to pay the bill recorded in Quickbooks.

What rules do I need to set up to ensure the correct expense is recorded in Quickbooks?

 

 

1 reply

L
LollyNino_C
October 15, 2023

Hello there, Sina.

 

I'm here to share insights about creating rules with different references in QuickBooks Self-Employed (QBSE) and walk you through the process.

 

In QuickBooks, we can create bank rules to automatically categorize transactions if you frequently engage with the same customers or vendors and the transactions follow a consistent pattern. If you use it for business purposes, select Business, and if it's for personal usage, choose Personal. Now, for categorization, you'll have to use Credit Card Payment.

 

Here's how:

 

  1. Go to Transactions.
  2. Click the drop-down arrow beside Add transactions.
  3. Select Manage Rules.
  4. Click Create rule.
  5. Enter Description, and select Business Current from the Account drop-down.
  6. From the Type drop-down, choose Business.
  7. Under Category, go to Financial and then choose Credit card payment.

 

Also, you may want to check out these articles as your reference in case you need a guide in categorizing transactions and using rules to manage them in QBSE: Create rules to speed up reviews in QuickBooks Self-Employed.

 

If you have downloaded transactions that don't apply to the rules, you can manually categorize them. This way, you can organize your income and expenses. 

 

Feel free to add your reply below if you have further concerns about categorizing transactions in QuickBooks Self-Employed. I'll standby to help you out. Have a good one and take care.

S
sina_jazayeriAuthor
October 15, 2023

Hi, thanks for your reply.  I understand how to set up rules, but need help understanding how Quickbook works.

As I have my credit card transactions set to be imported into Quickbook automatically, I get the individual transactions on the credit card imported into Quickbook; but then I also get an entry which the total owed to the credit cart (the invoice amount as a negative number).  

I also have my current account set up so all business transactions on that are also automatically imported into Quickbook.  So there I pay the Credit Card Invoice.  

Am I right in assuming that if I categorise both the negative credit card invoice and the positive payment out of the current account as Business Expenses the net effect is they cancel out (e.g. £1000 + (-£1000) = 0 and so the only real expense remaining on the business are the individual expense transactions imported from the credit card account?

G
GlinetteC
October 15, 2023

I appreciate your getting back to us and sharing additional details regarding your imported transactions, Sina. 

 

I'll provide additional information about how QuickBooks handles this matter.

 

When categorizing expenses, it's crucial to consider whether they are directly related to your business operations. If an expense is not incurred for business purposes, it should not be categorized as a business expense. Instead, the actual cost of such an expense should be attributed to your checking account, as it is the account responsible for making the payment for the credit card.

 

By accurately categorizing your expenses, you ensure that your business records reflect the proper financial position of your business. 

 

Moreover, you can assign transactions, ensuring they are allocated correctly to the appropriate line of your Schedule C.

 

I'll keep this thread open if you have other questions regarding managing transactions or relevant QBO issues. I am always available to help. 

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