How to enter "Expenses incurred as an Agent" or Billable Expenses to properly account for HST

Bulia · ‎September 18, 2023

I act as an agent when incurring certain expenses

I want to understand how to properly enter these types of expenses on an invoice while also reconciling my credit card balances

example

I rent clothing from two designers, both charge $100 and I style my client with those clothes for a service fee of $300

one of the designers doesn't charge HST as their business is not big enough and so they are exempt

I have two invoices from the designers, one for $113 and one for $100

when I charge my client this is how I want their invoice to look like:

My Fee: $300

HST: $39

Expenses:

Designer A: $113 (100+13% hst)

Designer B: $100 (no hst)

total: $552

but I want to make sure that at the end of the day I am only collecting $39 in HST and not claiming any HST paid on the expenses

how do I properly enter this in Quick Books

Trish_T · ‎September 18, 2023

Hi Bulia,

I appreciate you reaching out to us here. Welcome! It's vital that you're entering your transactions accurately in QuickBooks Online, to ensure your books remain balanced. In this situation, I encourage you to reach out to an accounting professional for their expertise and best course of action. If you don't have an accountant, we can help you locate a ProAdvisor in your local area.

Should you have any other questions, please don't hesitate to reach back out. We'd be happy to help!

Bulia · ‎September 18, 2023

I don't understand

you're telling me I need to ask an accountant on how to use quickbooks?

Amanda-B · ‎September 18, 2023

Thanks for getting back to us here. Entering your expenses can be done by following the steps here. However, it's important that your sales tax is applied accurately, in keeping with government standards. I recommend reviewing your sales tax to ensure your items are setup properly for amounts you pay on purchases, along with what you collect on sales. For additional assistance, it's best to speak with an accounting professional, so your books are accurate and aligned.

AdminAndrea · ‎September 21, 2023

Are you using the "Billable Expenses" feature in QBO? If you are then you should be able to mark expenses as billable and then when you invoice your customer you can pull that information into your invoice.

As long as you are allocating Sales Tax to each line correctly, QBO should capture your tax details correctly.

It's always a good idea to double-check your tax reports to make sure that QBO is pulling the correct information... the QBO team always suggests having an accountant to provide guidance because they don't want to be liable for any errors or omissions...

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How to enter "Expenses incurred as an Agent" or Billable Expenses to properly account for HST