@hello12 wrote:
Hello,
BookYogaRetreats collect a deposit amount on your behalf, then deducts a % commission, and then charges VAT on top of that commission. The remaining amount is then paid out to your business account. This leaves you to then charge the customer the final amount.
Whats the best way to account for this in Quickbooks?
With the accrual basis, the receipt of a deposit is not a sale. It's the delivery of goods or services that creates the sale. So when you get the deposit, it's balance sheet activity. One way to record it is to create a Receive Payment transaction, which creates a credit on the customer's account, to be used later when an Invoice is created, for the full sale amount, when the service is delivered. The previous credit will be automatically applied, if you left the default setting, showing the balance remaining, at the bottom of the invoice.
The advantage of this method is that you can easily see the remaining balance at any time.
On the cash basis, the receipt of a deposit IS a sale. So that can be raised immediately with a Sales Receipt. Then when you want to charge the customer the final amount, create an Invoice for the balance.
Regarding the commission on the deposit, the Receive Payment or Sales Receipt should be for the full deposit amount the customer paid, and should be sent to Undeposited Funds. When you create the Bank Deposit, enter the commission in the bottom section as a negative, so the net amount is the actual amount received.
I don't know the VAT implications of all this.
