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Level 1

Billing customers for expenses

I regularly make purchases on behalf of clients and then invoice them for reimbursement. I currently enter each purchase as an expense and keep a separate list of the expenses so that I remember to add them to the customer's invoice each month. However, this is cumbersome, and I occasionally forget to add expenses to an invoice.

Is there a way to add the expense to a customer's account when the expense is entered? And is there a way for QuickBooks to keep track of these expenses when invoices are created?

41 Comments 41
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Level 1

Billing customers for expenses

Why would some billed items still appearing as unbilled?  I'm using Quickbooks Desktop Premier Contractor Edition.  (Perhaps changing the Item on the bill after an invoice has already been prepared is breaking the connection?)
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Level 2

Billing customers for expenses

Hi Cameron

Yes!  This is the beauty of Quickbooks - when you enter your expense just mark the expense billable to your customer.  When you go to invoice that customer you will see a message - or pop up that says that you have outstanding items to bill them for them.  Depending on which online product you have the process is a bit different for including the unbilled charges for your client - but it will automatically notify you regardless.  You can always go to your reports and search for Unbilled Charges report to help you know what is still outstanding.  Your customer center also has an unbilled activity amount on the money bar.  This will make your job much easier!  Hope this helps! : )

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Level 1

Billing customers for expenses

I am recording a credit card expense that will be reimbursed by a client. What account do I reference for this? Accounts Receivable or Maintenance? (it is a maintenance exp for the client)
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Level 1

Billing customers for expenses

I have figured out why I am unable to bill expenses to customers - it is because this feature is only available for the more expensive versions of QuickBooks Online. As a result, I'm stuck with my manual process.

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Level 1

Billing customers for expenses

Is this true?  If so... this is terrible news... I'm trying to figure out what account I put the expense under...
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Level 2

Billing customers for expenses

Hi Cameron

Glad you figured it out! Remember your time spent on your bookkeeping could be better spent earning money or creating new business for yourself. Always count that cost! Have a great day! : )
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Level 1

Billing customers for expenses

Hi - I have a similar question. I purchase items frequently to bill to customers. I enter the purchase into Quickbooks - date, memo, amount etc. The I click "edit" and mark it as billable to the customer. I am wondering if there is a shortcut for this. Is there a way to bulk edit transactions with a certain memo description as billable to a particular customer?
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Level 1

Billing customers for expenses

My account was downgraded, for whatever reason. I found out that when it was downgraded, I lost the ability to write an expense and bill it directly. So, now I have to do as you have stated. It's a real pain in the butt. However, if you have the Plus version of QB you can do this all in one form. You set up the expense and go down the page to Items. Fill in the item and category and then click on which client to bill.

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Level 1

Billing customers for expenses

Yes, it is. I just found out myself.

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Level 1

Billing customers for expenses

I'm having an issue, or at least my accountant is having an issue with the way quickbooks applies the payment/reimbursement from the customer.  It is automatically applying a credit to the expense.  I need it to leave the expense alone, and instead apply the reimbursement to a Misc Income Account.  Do you know how to accomplish this???

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Anonymous
Not applicable

Billing customers for expenses

Thanks for joining the conversation, @TradeGuy,

 

I’d like to add to this discussion and share some more information about the recording customer refunds and payments.

 

I read through the whole thread, and I want to ask a few more information about your concern. When you say you received the reimbursement from a customer, how did you record it in Quickbooks? Also, what Quickbooks version are you using? Any additional details you can provide will help me provide you with the best resolution for your concern.

 

Typically, when you receive a customer payment, it automatically applies/post the payment to the Income account associated with your products/services. You can check the account by opening the item. Here's how:

QuickBooks Online:

  1. Click the Gear icon.
  2. Choose Products and Services.
  3. Find the item and click Edit.
  4. In the Product/Service information page, verify the Income account field is correct.

QuickBooks Desktop:

  1. Go to Lists.
  2. Hit Item List.
  3. Double-click to open the item.
  4. Look at the Account or Income Account field and check if it's using the correct income account.

In regard to your reimbursement question, if you are the one who refund your customer, QuickBooks take this as an expense/money-out transaction. To know more about refunding customers, please check out these related articles:

I'll keep an eye on this post for your reply. Please let me know by adding a comment below. I'm always here to provide answers. Have a great day!

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Anonymous
Not applicable

Billing customers for expenses

Sorry to tack on to the end of this thread but a similar question - Is there a way to get the markup to integrate with the item?  Currently if I add an item that item gets added at cost, then a second line item shows up that says % markup for the first item.

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QuickBooks Team

Billing customers for expenses

Hello Becky, 

 

Can you clarify what you mean by a markup? When you say a second line item "shows up that says % markup for the first item", what do you mean by this?

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Anonymous
Not applicable

Billing customers for expenses

No worries, sorry I was not more clear the first try - I enter the bill from our vendor for say "postage" for $10 click the billable box and add 5% markup.  When I go to invoice the client, I add the "postage" expense for $10 to the invoice, a second line item appears that says 5% markup on postage $.50 for a total invoice of $10.50.  Does that make sense?

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QuickBooks Team

Billing customers for expenses

Thanks for clarifying those details, Becky. I get you now.

 

When you add a billable expense to your transaction, this allows for the additional markup percentage to be calculated on your product. There's no way for this to be shown in the same line as your product/service, as this is a charge outside the normal price that's been established for the inventory item. 

 

I hope this answers your question. Cheers!

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Level 7

Billing customers for expenses

I am not an expert in QB Online, but there should be a setting somewhere (in QB Desktop it is in Preferences, Time & Expenses, Company Preferences) where you can tell QB to track reimbursable expenses as income.  When you do that, the entire amount, not just the mark-up, should go to your income account.  The default in desktop is not to track as income, but rather decreases expense instead.  Any Online gurus could jump in here . . . is there such a setting in QB Online and if so, where is it?

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QuickBooks Team

Billing customers for expenses

Hey Rochelley. I love your regular input into customer questions and it's awesome that you've highlighted the track reimbursable expenses as income feature in QuickBooks Desktop.

 

QuickBooks Online Plus has the option to track billable expenses and items as income. Although the Essentials-level account also lets you enter bills, this extra tracking feature isn't available. Here's what the Bills and expenses section of the Expenses tab looks like in QuickBooks Online Plus's Account and Settings, accessed through the Gear icon. The option was automatically checked off for me.

 

 

The (?) symbol beside it has this description: "Use one or more income accounts to track billable expenses. Related setting: Advanced > Chart of accounts > Billable expenses income account." Although the name of the feature is slightly different, I'm thinking this is the same sort of thing as you're looking at in QuickBooks Desktop.

 

Here's more information about billable expenses in QuickBooks Online. Give me a shout if you have more QuickBooks Desktop vs QuickBooks Online features. I'm trained in both products and happy to help with the comparison process. :)

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Level 3

Billing customers for expenses


@Taxgirlie wrote:

Hi Cameron

Yes!  This is the beauty of Quickbooks - when you enter your expense just mark the expense billable to your customer.  When you go to invoice that customer you will see a message - or pop up that says that you have outstanding items to bill them for them.  Depending on which online product you have the process is a bit different for including the unbilled charges for your client - but it will automatically notify you regardless.  You can always go to your reports and search for Unbilled Charges report to help you know what is still outstanding.  Your customer center also has an unbilled activity amount on the money bar.  This will make your job much easier!  Hope this helps! : )


 

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Level 3

Billing customers for expenses

 
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QuickBooks Team

Billing customers for expenses

Hi BNC. I want to make sure I'm on the same page as you. Which items are you referring to? Feel free to send screenshots of examples. I'll be on standby. 

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Level 3

Billing customers for expenses

By "items" I mean those billable expenses that are assigned to customers when entering a bill. Some of these should be taxed and some should not. I wish QB automatically made these expenses taxable when assigned to customers based on their tax status.

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QuickBooks Team

Billing customers for expenses

I see what you're saying. If you're adding these billing expenses to your invoice, you can manually remove the taxes from the invoice. Let me know if you need help with doing this. 

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Level 3

Billing customers for expenses

 
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QuickBooks Team

Billing customers for expenses

I can see how beneficial it would be to be able to automatically add taxes to the items in the invoice. At this time, that capability isn't offered in QuickBooks Online but I'll be happy to bring this to the attention of our product developers. New product ideas and improvements are largely based on the feedback we get from users like you. Let me know if you have questions. I'll be here.