Hello vjjewellers,
Welcome to the Community! QuickBooks Online makes it easy to record customer payments and keep your sales organized. I know that sometimes customers make deposits prior to an invoice being issued for a future service. I can walk you through how to do this.
In this situation, you can still record the payment now and apply it to a future invoice once it's been created. To record the payment in QuickBooks Online:
- Click on the +New button towards the top left of the dashboard.
- Under Customers, select Receive Payment
- From the Customer dropdown, select the name of the customer.
- From the Payment method dropdown, select the payment method.
- From the Deposit to dropdown, select the account you put the payment into. (Tip: You can put the money directly into an account, like your chequing account, or select Undeposited funds if you need to group the payment with others.)
- (Optional) Enter the Reference no. and Memo if needed.
- When you're done, select Save and close.
Upon clicking Save and close, you may get a message warning that the payment is being recorded as a credit since it has no linked invoice. Click OK to continue. The payment will then be recorded under the applicable customer for when the invoice is actually created.
When you're ready to apply the advance to the invoice, you'll find the particular invoice within the Sales tab, and under the Action column select Receive Payment. The next screen will show the unapplied payment that you previously recorded. Check the box next to that payment, fill out any other information that's needed, then click Save and close. You can find more details on recording payments here.
One thing to note is that if the Automatically apply credits setting is toggled on, then the payment may be automatically applied to the next invoice created for this customer. To avoid this, you can confirm whether this is set to on or off by:
- Go to the Gear icon and then click Account and Settings.
- Select the Advanced tab.
- Scroll down to the Automation section and click the pencil to edit.
- You can then turn the "automatically apply credits" setting on or off, and click Save. Then click Done.
I also recommend checking out our Community article Record a retainer or deposit. This is a more involved method that could be considered to record an advance if it's acting as a retainer or deposit. You may want to consult with your accountant to see which method is better for your business needs. You can invite your accountant to view you books from within the My Accountant tab. If you're not working with an accountant already, then you can use the Find a pro to help option to search for a QuickBooks-certified Pro Advisor near you.
Please let me know if I can assist with anything else!
