Customer paid in wrong currency - how to put this through the books?

SGI · ‎December 21, 2020

I have a UK Customer. I invoiced them in GBP (and GBP is set as their "home" currency in QBO).

For some reason they have paid in EURos. It is a small amount - not worth returning the money and getting them to correct their payment.

How do I put this payment through the books?

Jen_D · ‎December 21, 2020

Thanks for posting again, @SGI,

At the moment, you can only link transactions with the same currency in QuickBooks Online. We're unable to directly apply the EUR payment towards a GBP invoice.

Your case is a special situation and so it needs a few steps to do. First, we’ll first have to create a new dummy bank account in the home currency to facilitate the movement between 2 different foreign currencies

Select the Gear icon, then select Chart of Accounts
Press New
Under Account Type column, select Cash at bank and in hand. Under Detail Type column, select Cash on hand. And under Name column, type in Dummy Bank.
Before saving and closing, make sure that it is in the home currency (which is GBP in this case)

We’ll first have to record payment of the foreign invoice. In the Receive Payment module, set the Deposit To field to Dummy Bank. Before saving the transaction, take note of the home currency (GBP) amount displayed at the bottom right.

Next, we’ll have to transfer this GBP amount from Dummy Bank to the EUR bank account.

Go to the + New icon and select Transfer.
Under Transfer Funds From column, select Dummy Bank from the drop-down arrow.
Now, in the Transfer Funds To, select EUR Bank from the drop-down arrow.
In the Currency column, select GBP from the drop-down arrow.
For the Transfer amount column, type in the amount.
Under Exchange rate, the exchange rate will automatically appear. But you can manually change the rate.

If you have any questions, let me know in the comment. I'll be right here to help you with the customer payments. Have a good one!

View solution in original post

EmmaM · ‎December 21, 2020

Hello SGI, When they have paid it in Euros has it in your bank converted to GBP and there is an exchange gain loss so it differs from the invoice amount received?

SGI · ‎December 21, 2020

Hello,

No, they have paid in EUR to our EUR account. Invoice is in GBP and money have arrived in EURos into EUR acc. So I need to link a GBP invoice to received EUR payment.

Jen_D · ‎December 21, 2020

Thanks for posting again, @SGI,

At the moment, you can only link transactions with the same currency in QuickBooks Online. We're unable to directly apply the EUR payment towards a GBP invoice.

Your case is a special situation and so it needs a few steps to do. First, we’ll first have to create a new dummy bank account in the home currency to facilitate the movement between 2 different foreign currencies

Select the Gear icon, then select Chart of Accounts
Press New
Under Account Type column, select Cash at bank and in hand. Under Detail Type column, select Cash on hand. And under Name column, type in Dummy Bank.
Before saving and closing, make sure that it is in the home currency (which is GBP in this case)

We’ll first have to record payment of the foreign invoice. In the Receive Payment module, set the Deposit To field to Dummy Bank. Before saving the transaction, take note of the home currency (GBP) amount displayed at the bottom right.

Next, we’ll have to transfer this GBP amount from Dummy Bank to the EUR bank account.

Go to the + New icon and select Transfer.
Under Transfer Funds From column, select Dummy Bank from the drop-down arrow.
Now, in the Transfer Funds To, select EUR Bank from the drop-down arrow.
In the Currency column, select GBP from the drop-down arrow.
For the Transfer amount column, type in the amount.
Under Exchange rate, the exchange rate will automatically appear. But you can manually change the rate.

If you have any questions, let me know in the comment. I'll be right here to help you with the customer payments. Have a good one!

anjum · ‎January 03, 2022

While i am following the above steps, I still can see the amount in undeposited fund under Bank deposits. Although the net effect on dummy account is zero once i check the balance in the account but i wonder what is happening here. A little insight can be helpful here.

Thanks

TirzahC · ‎January 03, 2022

Hello there, anjum.

One of the possible reason as to why stay on the Undeposited fund under Bank deposit is that you might have chosen it as the Deposit to account when receiving your payment. Make sure to set the Deposit to field to the dummy account when recording invoice payment.

Additionally, learn how to receive and record invoice payments. This ensures all the transactions are recorded and managed accurately in QuickBooks.

Please feel free to leave a comment if you have any other questions about managing your banking transactions. I'm always here to help. Take care.

AJ1603 · ‎June 06, 2024

Are these instructions if customer has paid into Euro instead of sterling acc

GeorgiaC · ‎June 06, 2024

Hi AJ1603, thanks for joining this thread

We'll be happy to share some additional guidance on how to record this in your QuickBooks.

Did you refund the customer the payment from the EUR account, or are you looking to match the EUR payment against a GBP invoice to the customer?

AJ1603 · ‎July 30, 2024

Can I please ask when I process the invoice into the dummy account do I enter the figure paid into euro account or the invoice amount?

John C · ‎July 30, 2024

Hi AJ1603 When you're processing the invoice payment you'd enter the GBP equivalent of the amount received, we assume that would be the full amount of the invoice.

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Customer paid in wrong currency - how to put this through the books?