How can I apply a deposit to a vendor credit? The vendor credit transaction does not show up in Banking when I try to match the bank deposit to the refund.

I hope you're doing great today, @allyvetimaging.

I got you covered in applying the deposit to a vendor credit in QuickBooks Online.

You have to create a deposit to record the refund. This way, you can match the transaction from the Banking page. Know that the vendor credit will not show up on the Banking section. This can be found when applying vendor payments.

To enter the refund as a deposit:

1. Click the New + icon.
2. Choose Bank Deposit.
3. Under Add funds to this deposit, choose the vendor name in the Received from field.
4. Choose Accounts Payable in the Accounts field, then enter the credit/refund amount in the Amount field.
5. Select Save and close.

After that, you can now match the deposit to the bank transaction. Just make sure that the match is correct.

Here's how:

1. Find a downloaded transaction with the Match option in the Action column.
2. Note the Date, Description, Payee, and amount spent or received.
3. Select the downloaded transaction to expand the view.
4. Review the Matching records found in QuickBooks. This is the possible matching transaction you already entered in QuickBooks.
5. Select the link next to each match to get more details.
6. Make sure this is the correct match. In particular, review the Deposit to, Payment method, and Bank account fields on forms for the existing transaction in QuickBooks.
7. If this is the correct match, close the open transaction.
8. Select ​Match​.

Refer to this article for more information about categorizing transactions in QuickBooks Online: Learn how to review downloaded bank and credit card transactions and put them in the correct account...

To give you more tips about managing vendor credits and recording cash backs in QuickBooks Online, please check out these links:

• How can I record a cash back to my credit card account?
• Learn how to record a refund from a vendor in QuickBooks Online

Let me know if you have any other concerns with recording vendor credits in QBO. I'm always ready to help. Take care!

That worked.  Thanks so much!

Hello allyvetimaging,

I am so happy that this was resolved for you. Just know whenever you need help, the QuickBooks Community is here for you! I hope you enjoy your day!

We don't want to lose sight of tracking the credits we should be getting refund checks for. Is there a way to match a check received from vendor for a credit entered in QB Desktop that is not a downloaded transaction?  Or would the best way be to delete the credit from QB and then deposit to the expense account that needs crediting.  

Thanks for chiming in on this thread, JPS AJ.

Let me add some additional info about matching transactions.

To match the credit you've recorded in QuickBooks to a check downloaded in the Bank Feeds, please ensure they have the same check numbers, amount, date, and payee. 

Sometimes QuickBooks may not match a transaction in an electronic statement with the transaction recorded in QuickBooks. If you're in this situation, you'll want to manually match them.

For the Advanced Mode, here's how:

1. In the Unrecognized tab, you can manually match your transactions to what’s in your books.
2. From the transaction, select the drop-down in the Action column, and select Match to existing transactions.
3. Select the matching transaction, then select Save and add to register.
4. If the amount doesn’t match, select Resolve to split entries to balance the remaining amount. You can also add resolving split entries in an existing posted transaction for deposits and payments.
   1. If you’re matching a money-out transaction to existing bills, edit the amounts under the To Pay column to indicate full or partial payments against bills.
5. Once you’ve added details, click Save and add to register to add the transaction to your books.

As for the Classic/Express mode, you can follow these steps:

1. Go to the Banking > Bank Feeds > Bank Feeds Center.
2. Open the Match Transactions window and from the Financial Institution dropdown, make sure the correct bank account is showing.
   1. Click View.
   2. Download and view the electronic statement.
   3. In the Match Transactions window, make sure the Show Register checkbox is selected.
3. Select the transaction in the statement that you need to match to a transaction in the register.
4. Select the transaction in the register to match to. Make sure the amounts match.
5. Click Match.

You can read this article for reference: Add and match Bank Feed transactions in QuickBooks Desktop.

I'd also like to share this link to see the different scenarios and how you can record the vendor refund: Record a vendor refund in QuickBooks Desktop.

If you have any additional questions about the bank feeds or need help with other task in your account, please let me know in your reply. Have a good day ahead.

I received a paper check - we do not download our banking transactions.  Is there a way to match it, without it being a downloaded transaction?

Hi there, @JPS AJ. I'm here to share with you some additional information about handling your vendor refund in QuickBooks Desktop (QBDT).

Since you received a paper check, you can record the vendor check as a deposit from the Banking menu.

Here's how:

1. Go to the Banking menu, then select Make Deposits.
2. If the Payments to Deposit window appears, select OK.
3. In the Make Deposits window, select the Received from the drop-down and choose the vendor who sent you the refund.
4. In the From Account drop-down, select the appropriate Accounts Payable account.
5. In the Amount column, enter the actual amount of the Vendor check.
6. (Optional) Enter a memo, check number, payment method, and class.
7. Click on Save & Close.

Once done, record a bill credit for the refunded amount and link the deposit to the bill credit. You can check out the steps from Scenario 1: The vendor sends you a refund check for a bill that is already paid section in this article: Record a vendor refund in QuickBooks Desktop.

If you want to match your entries, you can bring the transaction to QuickBooks manually using the manual upload. First, prepare the check as a QuickBooks Web Connect (.qbo) file. Then, import it to QuickBooks.

On the other hand, you can review the resources from this link for more tips while handling your vendor transactions in the future: Accounts Payable workflows in QuickBooks Desktop.

If you have any other questions while tracking the paper check you've received, let me know by adding a comment below. I'm more than happy to help. Have a good one!

My company had already entered a credit and then received a deposit for that amount. I have QuickBooks Desktop so I first entered the deposit into the correct bank account by clicking on "Banking" at the top of the screen, then "Make Deposits", select the bank account and date you need. "Received From" would be the vendor that you received the check from. "From Account" should be Accounts Payable. Then enter the other information about the deposit and click "Save & Close" Then I went into "pay bills", put a check mark beside the vendor credit that I wanted to use, then chose "set credits" at the bottom of the screen. I did not change the payment date, method or account in the drop down box. I then clicked "Pay Selected Bills". It applied my credit to the deposit for this vendor.

Thank you for posting your solution! I've been scouring the internet for far too long to see if there was a way to do this before coming across your post. This worked for me as well. Thanks again

@MyHTSpace wrote:

I hope you're doing great today, @allyvetimaging.

 

I got you covered in applying the deposit to a vendor credit in QuickBooks Online.

 

You have to create a deposit to record the refund. This way, you can match the transaction from the Banking page. Know that the vendor credit will not show up on the Banking section. This can be found when applying vendor payments.

 

To enter the refund as a deposit:

1. Click the New + icon.
2. Choose Bank Deposit.
3. Under Add funds to this deposit, choose the vendor name in the Received from field.
4. Choose Accounts Payable in the Accounts field, then enter the credit/refund amount in the Amount field.
5. Select Save and close.

After that, you can now match the deposit to the bank transaction. Just make sure that the match is correct.

 

Here's how:

1. Find a downloaded transaction with the Match option in the Action column.
2. Note the Date, Description, Payee, and amount spent or received.
3. Select the downloaded transaction to expand the view.
4. Review the Matching records found in QuickBooks. This is the possible matching transaction you already entered in QuickBooks.
5. Select the link next to each match to get more details.
6. Make sure this is the correct match. In particular, review the Deposit to, Payment method, and Bank account fields on forms for the existing transaction in QuickBooks.
7. If this is the correct match, close the open transaction.
8. Select ​Match​.

Refer to this article for more information about categorizing transactions in QuickBooks Online: Learn how to review downloaded bank and credit card transactions and put them in the correct account...

 

To give you more tips about managing vendor credits and recording cash backs in QuickBooks Online, please check out these links:

• How can I record a cash back to my credit card account?
• Learn how to record a refund from a vendor in QuickBooks Online

Let me know if you have any other concerns with recording vendor credits in QBO. I'm always ready to help. Take care!

---

Thank you for helping me find the information I needed.

This saved my day! Thank you so much! Folks, when it says use AccountsPayable - it's not referring to any sub account, it's the Main/Primary AccountsPayable folder in your chart of accounts.

I just copied my QBO advanced account to a new QBO advanced. The categorized transaction did not come over in the copy. Some of the items I need to correct is linking vendor credits to deposits. How would I do this if I don't have the categorized transactions available?

Hello there, TonyaRSB.

Yes, that's right. Categorized transactions are unable to copy from an existing QuickBooks Online Advanced company to a new one. No worries, we can handle them properly by creating a bank deposit. Let me show you how:

First, make sure you've created a vendor credit. Then, make a bank deposit.

1. Go to the +New button and select Bank Deposit.
2. In the Add other funds to this deposit section, enter the following:
3. Received from: Select or enter the vendor name.
4. Account: Select the Account payable.
5. Amount: Enter the amount.
6. Select Save and Close.

Then, link the vendor credit to the deposit using Pay bills. After that, we can match the deposit with your bank transaction. Here's how:

1. Go to the Transactions or Banking menu. 
2. Select the tile for the account you want to review.
3. Find a downloaded transaction. Then, click Match under the Action column.

That will do. I have collected some articles for more information about handling bank data in QBO.

• Set up bank rules to categorize online banking transactions.
• Reconcile an account in QuickBooks Online

Also, if you want more tips and ideas about handling vendor credit and refunds in QuickBooks, feel free to visit and read this guide: Track credits for your vendors.

Please let me know if you have more concerns about associating transactions in QuickBooks or have questions about QuickBooks Online Advanced. I'm here to assist you anytime. Take care!

There are already bank deposits created for these credits. The error is telling me I need to link them. Most of the errors are from prior years. How am I supposed to clear these if the vendor credit and bank deposy have already been recorded?

Thanks for getting back to us, TonyaRSB.

You can use the Pay Bill feature to link the deposit to the vendor credit. Please note that this will not pay an actual bill or affect your balance since we are only linking the deposit to the credit. 

Here's how: 

1. Click the + New button and select Pay bills.
2. Choose the bank deposit you created. You’ll see the amount of the vendor credit in the Credit Applied field.
3. Make sure the Total payment is $0.00.
4. Select Save and close.

Details about this are shared in the last part of this article: Enter a Refund From a Vendor.

Reply to us again and let me know if you're able to link the transactions together. The Community is always here if you need anything else. 

I don't think you are understanding. I recently copied my QBO file. The errors that I am receiving are from the copy and are mostly for deposits in prior years that have already been recorded. Here's one for example:

Please update Bill Payment (ID: 24618) to link the following transactions:
• 10.7 for Deposit (09/06/2018)
• 10.7 for Vendor Credit (08/22/2018)and then change the Bill Payment total to 0.

Thanks for following up on this thread, @TonyaRSB. I'm happy to provide clarification about your issue, I want to make sure everything is straightened out.

To link the deposit to the vendor credit, you'll have to use the Pay Bills feature. Even though you aren’t paying a bill, this is the method the connect them in QuickBooks Online and keep your vendor expenses accurate. You can follow the steps provided by my colleague @JenoP above. You may also refer to this article and proceed to step 3; Enter a Refund From a Vendor.

I'd appreciate it if you'd keep us posted with your result. I'll be happy to help until it's resolved!

If I enter another deposit, my bank balance will be off. These are not current year transactions. Some go all the way back to 2014. They were correct in the old QBO file and now they are not. I’m just not sure how to correct prior year transactions.

I'll guide you in handling that transaction, TonyaRSB.

You don't have to create another deposit. Since the deposit and vendor credit has already been entered, you'll want to link them using the Pay Bills feature. Here's how:

1. Click the + New button.
2. Select Pay bills.
3. Select the existing bank deposit.
4. Take note of the amount of the vendor credit in the Credit Applied field. The total payment should be $0.00.
5. Select Save and close.

Alternatively, you can also link them by creating a journal entry. Take note that you may need to consult an accounting professional in performing this process to ensure that everything is recorded accurately.

For more resources while working with your other vendor transactions, you can check out some topics here: Expenses and vendors.

If I can be of any additional assistance, just let me know by dropping a comment below. Have a great rest of the day.

This worked perfectly.  Key here is to follow specific instructions and don't skip anything thinking there is a shortcut.  I really appreciate the detailed response  Thanks all.

Good morning, @territyree. 

Thanks for chiming back in on this thread. 

I'm so glad my colleague was able to give you the best solution for your business. 

Reach back out if you have any other questions or concerns. Have a wonderful Tuesday! 

How would I do this in QB Desktop?

Hi there, semagruder.

Thank you for visiting the QuickBooks Community. I'll ensure you can enter vendor refund or credit to QuickBooks Desktop by performing the steps below.

There are various options on how you can handle vendor refunds based on the scenario and recommended details to manage them. To start recording refunds you received from a vendor, you'll have to make sure that you create a vendor or Bill credit for the refunded amount.

Here's how:

1. From the Vendors menu at the top choose Enter Bills.
2. Select the Credit radio button to account for the return of goods.
3. Enter the Vendor name. Then, choose the Expenses tab and enter the Accounts on the original bill.
4. From the Amount column, enter the appropriate amount for each Account (the amounts may have to be prorated).
5. Click Save and Close.

After that, you can now record a deposit in the program. Please follow the steps below if the vendor sends you a refund check for a bill that is already paid.

1. Go to the Banking menu at the top and select Make Deposits.
2. If the Payments to Deposit window appears, click OK.
3. In the Make Deposits window, select the Received from drop-down and choose the vendor who sent you the refund.
4. From the From Account drop-down, select the appropriate Accounts Payable account.
5. In the Amount column, enter the actual amount of the Vendor check.
6. Select Save & Close.

Once done, you can now link the created deposit to the Bill Credit. You can follow the steps shared by my peer Angelyn_T or open this article to see the steps on how to perform the process: Record a vendor refund in QuickBooks Desktop. This way, you'll have accurate vendor entries and match your banking transactions if needed. 

Lastly, you may refer to this article to view various details on how Accounts Payable is used so you can track the money you owe your vendors and related transaction: Accounts Payable workflows in QuickBooks Desktop.

Please don't hesitate to click the Reply button below if you have any other questions about managing vendor refunds in QBDT. I'm more than happy to help, semagruder. Have a good one!

Is the option to "set credits" available only in QB Desktop? I've been trying this in QBO and can't find a way to match the bank deposit to the Vendor Credit. 

To summarize: I created a Vendor Credit which is reflecting in Accounts Payable as a Debit. Then, I received the refund payment from the vendor and recorded it as a Bank Deposit. I used the same Vendor name in both the Vendor Credit and the Bank Deposit (Received From Cell), and credited the deposit to Accounts Payable. Now, I have both the Vendor Credit and the Deposit reflecting in the Accounts Payable Aging Report. While they do cancel each other and net zero, I would really like to match them so they fall off the report.

I've tried both the methods mentioned in this thread and neither work.

Any suggestions?