Glad to see you here in the Community, @cameronk. I can help you apply the payroll deduction to an invoice of your employee in QuickBooks Online (QBO). Here's how:Go to the Payroll menu and then choose Employees.Choose the name of the employee you want to run.Click the edit pencil icon beside Pay.Select the Add a new deduction.Click the Deduction/contribution drop-down arrow, then choose New deduction/contribution.Select Other deductions under the Deduction/contribution type.From the Type drop-down arrow, choose a deduction.Enter the amount and then click OK.I've also added this article about recording customer payments in QBO: Record invoice payments. This way, you can also record it once you receive the payment to show the paid invoice. Don't hesitate to drop a comment below if you have other questions. I'm always happy to help. Take care!

Question

An employee has made a purchase and has been invoiced. Each week he gets a payroll deduction to go toward the invoice. How do i apply the deduction to the inovice?

Forum|Forum|5 years ago
September 9, 2020
19 replies
69 views

No text available

QuickBooks Online

M

Maybelle_S

QuickBooks Team

Glad to see you here in the Community, @cameronk.

I can help you apply the payroll deduction to an invoice of your employee in QuickBooks Online (QBO).

Here's how:

Go to the Payroll menu and then choose Employees.
Choose the name of the employee you want to run.
Click the edit pencil icon beside Pay.
Select the Add a new deduction.
Click the Deduction/contribution drop-down arrow, then choose New deduction/contribution.
Select Other deductions under the Deduction/contribution type.
From the Type drop-down arrow, choose a deduction.
Enter the amount and then click OK.

I've also added this article about recording customer payments in QBO: Record invoice payments. This way, you can also record it once you receive the payment to show the paid invoice.

Don't hesitate to drop a comment below if you have other questions. I'm always happy to help. Take care!

M

MadJack11

Question - when you record the payment on the invoice what do you select? Do you set up a new Payment Method - Payroll Deduction?

JoesemM

QuickBooks Team

Hello there, @MadJack11.

Yes, you can set up a new payment method when recording your invoice payment in QuickBooks. This way, you can track the transactions created. I'll show you how:

Click the + New (Create icon).
Under Customers Column, select Receive Invoice payment.
Select Add new from the Payment method drop-down menu.
Click Save and new.

For detailed steps, please click this article: Record invoice payments in QuickBooks Online.

You'll also want to run the Invoices and Received Payments report. This will give you the list of all invoices and the payments that are applied to them. Just go to the Reports menu type in Invoices and Received Payments in the Search bar.

Additionally, you can check this article on how to filter the report and run them based on your perspective: Customize reports in QuickBooks Online. It includes the steps on how to manage custom reports and memorize them.

If you have other questions or concerns, drop me a comment below or mention my name to notify me. I'll be right here whenever you need a hand. Have a nice day!

G

gb61

Will this work in QB desktop?

R

Rasa-LilaM

QuickBooks Team

Thanks for joining this thread, gb61.

Yes, the solution shared by my peer @lin_jcaj will work for desktop users. When applying a payroll deduction towards an invoice, you’ll have to set up a liability account and link it to the payroll item. Then create a journal entry and pay the invoice.

Let me share the steps again to help you accomplish the tasks mentioned above. Here’s how:

Go to the Lists menu and choose Chart of Accounts.
At the bottom of the screen, click the Account drop-down arrow and pick New.
Tick the radio button for Other Account Types to select Other Current Liability and press the Continue button.
Fill in the Account Name field with the right information and then Save & Close.
Next, edit the deduction item and map it to the newly added liability account.
Select the Lists tab and choose Payroll Item List.
Look for the deduction item you wish to apply as payment to the invoice.
Double-click it to see more details and click Next.
Choose the newly added liability account in the Liability account field.
Tap Next until you reach the Finish button.

Once done, create a journal entry and receive the invoice payment. Here’s an article that will guide you on how to manage your account receivables: Get started with customer transaction workflows in QuickBooks Desktop. It includes screenshots and links to easily follow the instructions.

Additionally, this resource will guide you on how to perform any payroll related-activities in QuickBooks Desktop. Since they’re arranged by topic, you’ll be able to view each one in no time: Self-help articles.

Drop me a comment below if you have other concerns or follow-up questions about applying payroll deductions towards an invoice. I'd be more than happy to assist you again.

C

centralprocessin

I have a similar issue:

Employee bought some or our products for which he was invoiced. I needed to deduct this total amount from his pay at payroll. We use a third party payroll company in Canada. so I credited the AR account to deduct this amount from payroll (creating a credit on the customer invoices side). the invoices not paid with payroll deduction. what should I do to pay for said invoices? thanks a mil. cannot seem to find a solution by myself.

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