Customer has paid by 2 methods, one of which resulted in charges. How do I account for it?

B-Legal · ‎March 28, 2023

Hi,

I had a customer pay me last week by cash. However she had (conveniently) forgotten that the price excluded VAT. She then made the VAT payment by bank transfer.

The cash was deposited by me into the business bank account via the Post Office, who charge a fee for the deposit. This fee is of course deducted prior to its arrival in my account.

As a result, I have 2 transactions in my bank and quickbooks for the one invoice: one for the cash deposit minus the Post Office fee, and one for the VAT via bank transfer.

This produces 2 problems for me:

1. I can't get the transactions to match.

2. As VAT registered company, I don't know what to set the VAT as when reconciling as the cash transaction is the client's payment for services excluding VAT and the post office fee, while the bank transfer is essentially purely VAT.

I have marked the invoice as paid and then generated a bank deposit where I minus the fee from the Post Office, but because I have 2 transactions for the same invoice, I can't seem to match the payments.

Could someone provide some advice on this?

Many thanks in advance :)

Ashleigh1 · ‎March 28, 2023

Hello B-Legal, thanks for posting on the Community page, You will have to click on find match on the banking page the payment to the invoice, so say for the vat payment you just need to match it then enter the amount you received then the invoice will be partially paid. For the cash payment you also need to click find match that however since there is a fee for that, you will need to resolve the difference and post it to the bank charges fee expense account.

B-Legal · ‎March 29, 2023

Hi Ashleigh,

Thanks for your reply.

I have to say that I was left scratching my head with your answer because QBO couldn't find any matching transactions, but then I realised that I had already accepted payment on the invoice which is why I couldn't find it.

I'm not sure as yet whether the VAT calculation will be correct but I shall look into that in due course.

Once I had deleted the receipt of payment of the invoice, I was then able to match the transactions. This then left me with an outstanding amount equal to the fee that the Post Office took. I then accepted payment for the outstanding fee which I deposited in Undeposited Funds. I then created a bank deposit, selected the payment, and then expanded Add Funds To Deposit. I then added the Post Office in and put the fee in as a minus figure.

This seems to have balanced everything, but I am concerned about the difference in VAT (albeit negligible).

Does this sound about right?

Ashleigh1 · ‎March 29, 2023

Hello B-Legal, thanks for coming back to us, glad to hear you got it all sorted and matched up in the end. The way you have recorded it is correct.

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Customer has paid by 2 methods, one of which resulted in charges. How do I account for it?