We sent a customer an invoice for £700, they sent us a bill for £600 and deducted this from what they owed us. How do I record that?

Hello there, rebecca_c_duffy.

I'd be happy to guide you on how to record these transactions in QuickBooks Online (QBO).

You can record it as a barter transaction in QBO. First, you'll want to set up a barter bank account so can use it as your Payment account when paying the bill.

Here's how to set up a barter account:

1. Go to gear icon. 
2. Select Chart of Accounts.
3. Click New to create a new account.
4. Under the Account Type drop-down, select Bank.
5. Under the Detail Type drop-down, select Cash on hand.
6. Enter the account name.
7. Select Save and Close.

Then, you create an invoice and Receive payment for it. 

To Receive payment, here's how:

1. Go to the gear icon and select Receive Payment.
2. From the Customer drop-down, select your supplier’s (barter partner) name.
3. Fill in the date and amount.
4. Select the Payment method drop-down, then Add new.
5. Enter Barter in the Name field, then select Save.
6. Select the Deposit to drop-down, then select your barter bank account.
7. Select Save and close.

Once done, you can create and pay the bill. 

Feel free to read through this article on how to record barter transactions in QuickBooks Online (QBO): Record a barter transaction.

Let me know if you have more questions about the barter process and I'd be happy to help you some more.