Supplier payment bounced back

Hi LindaA, 

Thanks for posting in the Community! We can create a supplier credit and deposit to record the refund and then use the Pay Bills option to link the bank deposit to the supplier credit. 

Step 1: Enter a supplier credit

This makes sure the credit hits the expense account you use for this supplier.

1. Select + New.
2. Select Supplier credit.
3. In the Supplier dropdown, select your supplier.
4. Depending on how you record purchases with this supplier, enter the Category details or Item details. Usually, this is the category, product, or service you’re getting a credit for.
5. Select Save and close.

Step 2: Deposit the money you got from the refund

1. Select + New.
2. Select Bank deposit.
3. In the Account dropdown menu, select the account where you got the refund.
4. In the Add funds to this deposit section, fill out the following fields.
   • Received from: Select the supplier who gave you a refund.
   • Account: Select Accounts Payable. Important: You need to pick Accounts Payable so you can tie the refund to the supplier credit. This may seem a little strange, but it’s the best way to do this.
   • Payment method: Enter the method your supplier used to refund you.
   • Amount: Enter the amount of your refund.
5. Select Save and close.

Step 3: Use Pay Bills to connect the bank deposit to the supplier credit

Even though you aren’t paying a bill, this is the right thing to do. This last step is to keep your supplier expenses accurate.

1. Select + New.
2. Select Pay bills.
3. Select the bank deposit you just created. You’ll see the amount of the supplier credit in the Credit Applied field. The Total payment should be $0.00.
4. Select Save and close.

You can also check on this article for your reference: Handle supplier credits and refunds in QuickBooks Online. 

Feel free to drop a comment below if you have any other questions. Have a great day! 

Thank you for that.  Do i have to put the Supplier invoice back in to pay it.

Hello there, @LindaA. I appreciate your immediate response.

I'll help you determine if you'll have to put the supplier invoice back and pay it in QuickBooks Online (QBO), so you can keep your account and financial data accurate.

You don't have to enter your supplier invoice or bill back and then pay it since you've already entered and recorded them in your QBO account. After performing the steps provided by my colleague above, you're good to go since it specifically guides you on how you can appropriately record the supplier payment that bounced back.

You can also refer to this article for the complete guide: Handle supplier credits and refunds in QuickBooks Online.

Also, I'm including one of our Help pages to guide you in accomplishing your tasks in managing your expenses and supplier transactions using QBO: Expenses and suppliers help for QuickBooks Online. It includes articles about supplier credits and how you can manage your money out payments, to name a few.

Let me know if there's anything else you need or if you have other concerns about managing supplier payments and expense transactions in QBO. I'm always here to help. Take care, and I wish you continued success, @LindaA.

I have followed all the steps but it says under the supplier 0 owing but i still should have the invoice that bounced back open to pay.  I am sorry if i am missing something.

Hi Linda, 

Thank you for your response. The reason why don't owe a supplier it's because we've used the Pay Bills option option to linked the supplier credit and bank deposit. 

Just to check, are you paying your suppliers via batch payment option in QuickBooks Online? If yes, you can reverse the bill payment so you can create a new valid ABA file. Here's how: 

1. Go to the Expenses menu, then filter to Bill Payments and any relevant date range/payee as required.
2. Select the bill payments and under the Batch Actions tab, select Reverse bill payments.
3. Go to the + New button, select Pay bills and recreate your batch payment and download the new ABA file.

For the refund, you can also allocate it to the same expense category on the original purchase if doesn't involve inventory. Reporting wise the refund will offset to the original money out.

Let me know if you require further assistance with supplier payments. I'll be here to help. 

That can't be right.

Why would you enter a supplier credit and a deposit?

If you spent $5,000 on travel, then enter a supplier credit of $5,000 against travel, and a deposit of $5,000 against the supplier, you have zeroed your travel expense and you are showing that your supplier balance is zero.

In fact your expense (travel) needs to remain unchanged, but your supplier balance needs to go back to $5,000 with a reversal of the supplier payment.

Hi WayneMead,

Thanks for joining the thread. 

If you've paid your supplier with ABA files and would like to reverse the payment made, you can follow these steps.

1. Go to Expenses tab.
2. Tick on the supplier bill payment.
3. On Batch actions drop-down menu select Reverse bill payments. 

Doing this, the bill will be re-open and you'll be able to create a new ABA file to pay for your supplier. 

Feel free to drop a comment below if you need further assistance. I'll be around to help. 

Thanks IntuitAika,

that's perfect!

Hello,

I have the same scenario.

Let me give you some additional information, I've paid the supplier 2550$ amount and I recorded as expenses without creating bill...

After one day the payment is bounced back. I tried to follow the above instructions, create the supplier credit (the balance of the supplier is showing negative) and I create the bank deposit when I go to pay bills, the transaction isn't showing.

Can someone help me on this ?

Thanks.

Charles

Hello there, @CG18011994.

I'm here to help record the supplier bounced payment in QuickBooks Online (QBO).

When creating the bank deposit ensure that you've selected the Account Payable (AP) account to show the bill that you need to pay.

Here's how:
 

1. Click on the + New button.
2. Click on Expense.
3. Under Payee choose the Supplier name and tick box for the supplier credit/vendor credit.
4. Select Save and Close.
   
    

   

Once done, create the supplier credit.
 

1. Click on the + New button.
2. Choose supplier credit/vendor credit.
3. Enter the enter and other information.
4. Hit Save and close.

Then, you can now create a bank deposit under the AP account, enter the amount and click Save and close. This way when you pay bill the AP will show on that page.

Let's go back to the supplier details to see if there is no open balance showing. You can also check this link to learn more about Handle supplier refunds and credits in QuickBooks Online.

Please keep me posted on how it goes. Let me know in the comments if you have other concerns about recording returned payments in QBO. I'm always around to help. Take care and stay safe always.