Supplier bill duplicate entered and paid but now refunded - how to record in QBO?

Thanks for sharing your concern, @alect.

I'm here to help you record the vendor refund for your duplicate payment. 

First, enter a vendor credit and use the correct expense account.

1. Go to the + New icon.
2. Select Vendor credit or Receive vendor credit. 
3. In the Vendor dropdown, select your vendor.
4. Depending on how you record purchases with this vendor, enter the Category details or Item details. Usually, this is the category, product, or service you’re getting credit for.
5. Click Save and close.

Then, you can deposit the money by following the steps below:

1. Go to the + New icon.
2. Select Bank Deposit.
3. In the Account drop-down menu choose account payable account  where you got the refund.
4. In the Add funds to this deposit section, fill out the following fields.
5. Select Save and close.

For the final step, you can use Pay Bills to connect the bank deposit to the vendor credit.

Here's how:

1. Go to the + New icon.
2. Select Pay Bills.
3. Choose the bank deposit you just created. You’ll see the amount of the vendor credit in the Credit Applied field. The Total payment should be $0.00.
4. Click Save and close.

To learn more about recording a refund based different scenarios, check out this article: Record a customer refund in QuickBooks Online

For your reference about the complete process of refunding a vendor: Enter a refund from a vendor.

Let me know if there's anything else that you want us to help with your vendor transaction. As always, the Community is always here for further assistance. 

Do I just void the duplicate invoice entered and paid?

"

1. Go to the + New icon.
2. Select Bank Deposit."

When selecting New Bank Deposit only the bank account is selectable - not Accounts Payable.

Hello, alect!

I admire your keenness for detail and want to clarify some processes to answer your follow-up questions.

The process of recording a bill-payment refund depends on the method you used, and whether you used categories or items on your bill. I will share three scenarios, and you can choose the one that applies to you.

Scenario 1: You paid with a bank account and used categories on the bill.

In this case, you can simply create a bank deposit, choose your bank as the receiving account, and use the same categories on your bill. This will reverse the money in the bank and the posted amounts in the expense categories.

Scenario 2: You paid with a bank account and used items in the bill.

For this scenario, you’ll want to create a vendor credit first, so you can select the same item on the bill and enter the same quantity. This is useful, especially when recording refunds for inventory items, which require strict quantity tracking.

After the vendor credit, you'll also want to create a bank deposit to show the returned funds in your bank register. In that transaction, you'll want to tag the vendor and use the Accounts Payable account (A/P) to categorize it.

Both the above transactions are saved as open credits under the supplier's profile. You will want to link them by making an expense or check transaction so that they can't be accidentally applied as payments to future bills. No worries, it won't be reported as an expense to your Profit and Loss nor will it be posted to the selected Payment account. They'll only be linked, and their amounts will just cancel out.

Scenario 3: You used a credit card to pay the bill.

If you used a credit card to pay for the bill, you can enter the refund as a credit card credit. Then, enter the same thing you used in the bill, whether categories or items. This transaction will post with a negative amount under your vendor's list of transactions, but it won't affect the vendor's open balance. This will also post a payment/reversal in your credit card register.

That's it. Please don't hesitate to reach back out if you have other questions about your vendor's refund. Take care always!

This is not working for me (and it seems overly complex to just record a refund).

I followed the steps but when I am creating a cheque and trying to add the credit created for the vendor/supplier, I get the following error:

You cannot add a credit for a supplier without any open bills

You're almost there, @alect .

To help you get past the error, let's ensure that Accounts Payable is selected in the Accounts column when creating a bank deposit. After that, you can create a check to link the vendor's credit and bank deposit.

Here's how:

1. In your QBO, go to the magnifying glass at the top right to locate and open the deposit. 
2. On the Account section, pick Accounts Payable (AP).
3. Hit Save and close.

Once done, here's how to link the deposit to the vendor credit:

1. Go to the +New at the top left to get to the Check.
2. Choose the vendor name in the Payee drop-down.
3. From the Add to Check section, tick Add for the outstanding vendor credit and deposit.
4. Click Save and close to complete the process.

To learn more about the process, consider checking out this article: Enter a credit from a vendor.

For more information on how to handle vendor credits and refunds, check out this article: https://quickbooks.intuit.com/community/Income-and-expenses/How-do-I-handle-vendor-credits-and-refun...

Drop a comment below if you have other questions. I’m always here to help. Have a nice day!