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Level 1

Advances to subcontractor

Best way to enter an Advance to a subcontractor. Mid month advance, usually applied to the end of  month entry.
I'd like to enter a 'credit' to their account so I can easily apply it to the invoice. Can I enter as a credit note, and apply a payment to it?
Currently the amount is being entered as a bill (posted against loans to subcontractor), bill is paid. Then the amount is deducted from next invoice against the same account.


It's too easy to miss repayments this ways. Any better suggestions?


1 Comment
Level 6

Advances to subcontractor

I use the Write Cheques function>Payable to: the subcontractor. Enter 'Mid-month Advance in the Memo field. In the bottom section of the cheque, select the Expense tab (not Item) and select Accounts Payable as the account.  There are no taxes on an Advance (or Prepayment), enter the amount of the Advance. In the Customer/Job column, select the Vendor (Subcontractor). Complete any other details you may need. This will create a Credit in the Sub-Contractor Account.


When you get the bill from the subcontractor for the month, enter the bill with applicable taxes, apply the Credit and pay  the balance of the bill.