Hi, we made a payment to a supplier in error, which was recorded as a Cheque. The supplier has now refunded the money to us, how do I record this in QB Online? Thanks

Thanks for reaching out to the Community, LizaM1. I appreciate your detailed information.
 

When entering a supplier refund in QuickBooks, the process can differ depending on the scenario. For example, if a supplier was overpaid, you don't need to enter a credit, since your books will already have an unapplied credit that acts as the supplier credit. Steps can also differ if you have automated bank feeds activated, or if your refund went to a credit card.
 

Here's how to deposit your money from the refund:
 

1. Use your + New button, then go to Bank deposit.
2. Specify a supplier in the Received from field.
3. Enter Creditors (Accounts payable) for your Account, then include an Amount.
4. For VAT, choose No VAT.
5. Select Save and close.

Next, you can enter a cheque to finish the process.

If there's any additional questions, I'm just a post away. Have a lovely day!

I have done this, but the supplier is now showing with a credit balance, whereas our payment to her and her repayment back to us, should have netted each other off?

Thank you for your prompt reply, @ LizaM1

I’m here to help you with the credit balance showing in QuickBooks Online (QBO). My colleague above is correct about creating a bank deposit for this transaction. After that, you will need to create a check to match the deposit you created. Here’s how:

1. Click the + New icon and select Cheque.
2. Choose the Payee and the Bank Account where you deposit the refund.
3. From the Add to Cheque section, select Add for the deposit and the supplier credit.
4. The balance should be 0 as they will cancel each other out. Then, select Save and close.

You’ll want to check out this article for more details: Record a customer refund or supplier refund in QuickBooks Online.

Let me know if you have more questions about any QuickBooks-related matters. I’m always here to help. Have a good one!

Ok, I will try this

Also, just to check I added the initial payment to the Supplier as a Cheque, was this correct?

Thanks

Thanks for getting back to the thread, LizaM1. I'll provide some details to clarify things for you.

Yes, that's correct. You can record the initial payment to the supplier as a cheque. In case you'll want to know more about creating cheques in QuickBooks Online (QBO). See this article: Create and record cheques in QuickBooks Online.

In case you can handle prepayments for suppliers in the future and if you want guidance in tracking it in QBO. Here's an article for you:  How to record Supplier prepayments for Products or Services.

Please let me know if you have clarification or additional information on managing refunds in QuickBooks. Have a good one!

I can't see the Supplier Credit as an option to add to the Cheque, I can only see the Bank Deposit?

Can I call someone to discuss?

Hello there @LizaM1. I appreciate all the steps you've performed to get this recorded, and I'm here to help you get this resolve.

As mentioned by my colleague ZackE above, the steps in recording the refund have different ways. In your scenario, you'll want to create the supplier credit and deposit them as Accounts Payable.

Here's how:

1. Select the + New icon at the left corner.
2. Choose Supplier Credit.
3. From the Supplier field, select the appropriate supplier name.
4. Enter the Date, Amount, and Account (the account used here is typically the original expense account on the original bill).
5. Fill in the other necessary fields.
6. Hit Save and close.

Once done, enter the Supplier Refund in the Deposits screen:

1. Tap + New.
2. Choose the Bank Deposit.
3. In the Add funds to this deposit section, fill in the following fields:
4. Received from: Select or enter the Supplier name.
5. Account: Select the Creditors (Accounts Payable).
6. Amount: Enter the Supplier refund amount. Here is an example of a completed Bank Deposit: 
7. Click Save and close. 

Then, link the Supplier Refund Deposit to the Supplier Credit: 

1. Click + New.
2. Select Expense or Cheque.
3. From the Choose a payee drop-down, select the supplier name.
4. Leave the Ref/Cheque no, Date, Amount, and Memo fields blank.
5. Click the Add to Expense or Add to Cheque section, and select Add for the outstanding bill and supplier credit.
6. Click Save and close.

For more information about the refund process in a different scenario, refer to this article: How do I handle supplier credits and refunds?

Also, I'd encourage you to contact our Customer Support Team. They have tools to check the process for you and provide other troubleshooting steps to record the transactions. You can visit this article on how to contact them: Customer Support Team. 

Additionally, I'll be sharing these articles that will guide you in running reports for your vendors for the payments they made:

• Run a report with vendor totals
• How to Use List Reports: Looking Up Customers, Vendors

Let me know if you have other questions by clicking the Reply button below. I'll be here to lend you a hand. Have a good day. 

Hi 

The problem is that I don't have anything to link the supplier credit too.  So in December we made a payment to her in error, it should have been paid to someone else.  She then repaid it to us in January, any other ideas?  Thanks

I can share additional information to get this resolved, LizaM1. 

Since vendor credit has already been entered, you'll have to create a Bank Deposit to deposit the money from your return. 

Here's how:

1. Click the Plus (+) icon and tap Bank Deposit.
2. Enter the necessary information.
3. On the Add funds to this deposit section, choose the vendor.
4. On the Account column, hit Accounts Payable (A/P).
5. Enter the amount.
6. Click Save and close.
    

Once done, use the Pay Bills option to link both transactions. I'll show you 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.
5. Select Save and close.

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

Keep your post coming if you need more help with recording supplier credit in QBO. I'm always here to help. Have great day!