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dcuff
Level 2

How should I apply a payment to an invoice when the fees are deducted prior to the bank deposit (Braintree deposits are less than the invoice because the 2.9% fee)

When receiving Braintree deposits, the fees are already removed from my customer payments. So when applying the payment the amount is less than the invoice. What is the best way to apply these Braintree payments to my invoices?

Solved
Best answer October 19, 2018

Best Answers
Raywhite28
Level 7

How should I apply a payment to an invoice when the fees are deducted prior to the bank deposit (Braintree deposits are less than the invoice because the 2.9% fee)

On the receive payment screen, enter the full amount of the invoice so the invoice can be paid. On the make a deposit screen, check off the customer payment being deposited, then on the next line enter the credit card discount as a negative number. This will match what Braintree is depositing.

View solution in original post

22 Comments
Raywhite28
Level 7

How should I apply a payment to an invoice when the fees are deducted prior to the bank deposit (Braintree deposits are less than the invoice because the 2.9% fee)

On the receive payment screen, enter the full amount of the invoice so the invoice can be paid. On the make a deposit screen, check off the customer payment being deposited, then on the next line enter the credit card discount as a negative number. This will match what Braintree is depositing.

View solution in original post

paul8
Level 1

How should I apply a payment to an invoice when the fees are deducted prior to the bank deposit (Braintree deposits are less than the invoice because the 2.9% fee)

The only downside I see to this is that you can't run an expense report for the vendor to see how much you paid in credit card fees for some reason.  I guess if I go into my P&L report I can click on the sub ledger and get a detail there, but it seems like a workaround for a basic thing that lots of people struggle with.
Cj6130
Level 1

How should I apply a payment to an invoice when the fees are deducted prior to the bank deposit (Braintree deposits are less than the invoice because the 2.9% fee)

This is not a credit card discount though so it'll through off the p&l come tax time.  When applying the payment you will see a button that says discounts and credits.  That's where you need to deduct the fees.  

mmp
Level 2

How should I apply a payment to an invoice when the fees are deducted prior to the bank deposit (Braintree deposits are less than the invoice because the 2.9% fee)

In doing this- will it affect the P&L- I don'w want it to show the full amount if I actually received less, it seems that this should be a merchant fee- but now sure how to apply it.

 

mmp
Level 2

How should I apply a payment to an invoice when the fees are deducted prior to the bank deposit (Braintree deposits are less than the invoice because the 2.9% fee)

In doing this- will the P&L be affected- it seems that it should be a merchant fee and deducted... not sure what the best is for this?

 

JenoP
QuickBooks Team

How should I apply a payment to an invoice when the fees are deducted prior to the bank deposit (Braintree deposits are less than the invoice because the 2.9% fee)

Allow me to jump right in and help with your question, mmp

 

Yes, it will affect your P&L. The best way of doing this is to use Undeposited Funds when receiving the payment. Then, add a line for the merchant fee when making a deposit to your bank. Make sure to add the merchant fee as a negative amount so it will deduct from the total amount that you received.

 

You can always reply to this thread if you have follow-up questions. 

kbolton
Level 1

How should I apply a payment to an invoice when the fees are deducted prior to the bank deposit (Braintree deposits are less than the invoice because the 2.9% fee)

@JenoP I have a similar situation with fees taken out by Shopify.

 

I have a Sales Receipt created by Cloud Cart Connector (Imports Shopify sales to Quickbooks) and I have a transaction imported from my bank in the "for review" state.

 

I want to match the Sales Receipt to the imported bank record, however the Sales Receipt is for an amount ($15.41) higher than the bank transaction  ($14.66 (Sales Receipt - Shopify fee)).  The Quickbooks Online match interface for the bank transaction will not show any Sales Receipts for amounts greater than the bank transaction amount. I'm at a loss as to how to properly match the Sales Receipt and associated bank transaction while appropriately accruing the fees.

 

FWIW... I've contacted Quickbooks customer support and they told me they don't have a solution for me and just told me to submit feedback in hopes of future enhancements. 😕

 

This doesn't exactly help me get my books in order for tax time.  Any suggestions?

JenoP
QuickBooks Team

How should I apply a payment to an invoice when the fees are deducted prior to the bank deposit (Braintree deposits are less than the invoice because the 2.9% fee)

Hi there, kbolton.

 

QuickBooks will match the transactions if they have the same amount. It's also considered a Match if the transaction date is within 90 days. Since the imported imported transaction is different from the what's recorded in QuickBooks, it will be not considered it as a match.

 

You might want to post the Sales Receipt in the Undeposited Funds first. Then, follow the same steps I've shared above to record the merchant or Shopify fee in making a deposit to the bank. Once done, use the deposit in looking for a match. 

 

I will also forward your feedback and feature request to our product engineers. They will review this future updates. 

 

Visit us again in the Community if you have other questions.

kbolton
Level 1

How should I apply a payment to an invoice when the fees are deducted prior to the bank deposit (Braintree deposits are less than the invoice because the 2.9% fee)

@JenoP In the short term, how would you propose handling this situation? Manually adjusting the Sales Receipt to match the bank transaction and then a separate journal entry to account for the fees assessed on the Shopify side?

Mark_R
QuickBooks Team

How should I apply a payment to an invoice when the fees are deducted prior to the bank deposit (Braintree deposits are less than the invoice because the 2.9% fee)

Thanks for getting back to us, @kbolton.

 

You can definitely consider that option. However, I still encourage seeking help from your accountant for more guidance. He/She could check if recording your fees this way won't affect your accounting books.

 

Please let us know if you have any other concerns. Have a good day!

bettyglauder
Level 2

How should I apply a payment to an invoice when the fees are deducted prior to the bank deposit (Braintree deposits are less than the invoice because the 2.9% fee)

wow. thank you! 

VeeHog
Level 2

How should I apply a payment to an invoice when the fees are deducted prior to the bank deposit (Braintree deposits are less than the invoice because the 2.9% fee)

I am working with a client who has a very small business and limited bookkeeping knowledge.  They are using Square to process payments on site as services are provided.  The process described is way beyond their capability.  I have not been able to find a way that will work for them.  And their business is all by credit card.  Definitely need an enhancement for this.

eddys brand
Level 1

How should I apply a payment to an invoice when the fees are deducted prior to the bank deposit (Braintree deposits are less than the invoice because the 2.9% fee)

There needs to be an update to accommodate this way of working.  I would say the majority of e-commerce shops work in this way.  You have a sale with "$X" which can sync to QBO as a Sales Receipt or Invoice and then you have a bank deposit with "$X minus fee" which can sync to QBO but they cannot be matched.  I should just be able to balance the difference to my Bank Fees category.  Come on.

Joshua R
QuickBooks Team

How should I apply a payment to an invoice when the fees are deducted prior to the bank deposit (Braintree deposits are less than the invoice because the 2.9% fee)

Hey there, @eddys_brand. 

 

Glad to have you here in the Community. 

 

I'm happy to submit feedback for you to our product developers to give them an insight into what our customers need in a future update. 

 

You can also follow The QuickBooks Blog to stay current on updates coming to the product. 

 

If you have any other questions, I'm only a reply away. Hope all goes well and you have a good rest of your week!

flgirl926
Level 1

How should I apply a payment to an invoice when the fees are deducted prior to the bank deposit (Braintree deposits are less than the invoice because the 2.9% fee)

By adding a line for the merchant fee (an Expense account) on the deposit as a negative amount so that it matches the deposit (total invoice amount minus the Square merchant fee) like you suggest - then we aren't accounting for the expense itself that Square is deducting as their fee. It is reducing the Square expense on the P&L, so that doesn't help off-set the revenue. How can we make it so the transaction matches the deposit (invoice total minus Square card fee) AND still get credit for the expense?

MaryAnn_E
QuickBooks Team

How should I apply a payment to an invoice when the fees are deducted prior to the bank deposit (Braintree deposits are less than the invoice because the 2.9% fee)

Hi @flgirl926,

 

You can manually add the bank charge as a deposit and exclude the transaction from the banking page. Let me show you how to record a deposit.

 

  1. Click the Plus (+) icon
  2. Choose Bank Deposit.
  3. Select the Bank account under Account.
  4. In the Add funds to this deposit section, fill out the information.
  5. Under the Account column, select a liability account.
  6. Enter the Payment Method and the Amount.
  7. Click Save and close.

 

I’ve got you an article to read on for your reference: How to Record Deposits.

 

If you have additional questions about matching transaction. I'll be around to help. 

catherine.delane
Level 1

How should I apply a payment to an invoice when the fees are deducted prior to the bank deposit (Braintree deposits are less than the invoice because the 2.9% fee)

 
 

Allow me to jump right in and help with your question, mmp

 

Yes, it will affect your P&L. The best way of doing this is to use Undeposited Funds when receiving the payment. Then, add a line for the merchant fee when making a deposit to your bank. Make sure to add the merchant fee as a negative amount so it will deduct from the total amount that you received.

 

You can always reply to this thread if you have follow-up questions. 

 

Hi - can you expand on this for me?  I often have payments coming in with fees deducted.  What is the best way for me to account for this in QB?

JohnMK
Level 1

How should I apply a payment to an invoice when the fees are deducted prior to the bank deposit (Braintree deposits are less than the invoice because the 2.9% fee)

How To Receive An Invoice When You Were Paid Less Than The Amount

  1. In your Invoice >> click Receive payment >> enter the amount of $500, but make sure that before your hit SAVE, choose UNDEPOSITED FUNDS for the Deposit to drop down arrow.
  2. Save that screen as a received payment.
  3. That will return you to the main screen, Now, click +NEW icon >> click Bank Deposit >> choose the correct Bank where the money will be deposited >> and then click the Payment of $500. Then, click the ADD FUNDS option below, choose ANY expense Account for the ACCOUNT and enter the amount of -$50, and SAVE.

This took 2.5 hours to verify with some idiot at QuickBooks Help Desk so value it.

SuzanaH
Level 2

How should I apply a payment to an invoice when the fees are deducted prior to the bank deposit (Braintree deposits are less than the invoice because the 2.9% fee)

Hi there,

I ran into a problem with your answer.  The first time around I used the "received payment" option under the customer name to pay a specific invoice.  Which gave me the zero balance to that invoice.   And then I used the bank deposit to match with the bank transaction.   BUT the problem is that in the Balance Sheet Report I got 2 transactions: the Bank Deposit income AND the full amount paid for the invoice.   So then I decided to use the sales receipt (undeposited funds) to remove the full amount from the balance sheet.  But now I can't match the invoice to the sales receipt.  Why can't I match a specific invoice to a Sales Receipt to have that invoice as paid in full?  I hope this makes sense. 

MadelynC
QuickBooks Team

How should I apply a payment to an invoice when the fees are deducted prior to the bank deposit (Braintree deposits are less than the invoice because the 2.9% fee)

I'll help you correct this transaction so you can continue to run your business, @SuzanaH.


Allow me to share some information first on how to manage payment in QuickBooks Online.


There are two options to record sales transactions in QuickBooks, and it depends on when you receive the payment. You can use the Invoice and then Receive Payment for a deferred. However, you’ll want to use the Sales receipt once it’s immediate.


When you used the Received payment option in QuickBooks, you should match it directly to your bank transactions. This way, we can avoid double-counted income. You can delete the deposit and Sales receipt you made to correct it. Here’s how:

 

  1. Go to the Magnifying icon and select the deposit. You can select the Advanced Search to locate the event easily.
  2. Click More at the bottom and choose Delete.
  3. Press Yes after.
    Capture.PNG

Once done, go back to the Banking page then used the Find match option to match them in the program. You can check this article on how to add and match downloaded banking transactions for your reference.


Feel free to drop a comment below if you have any other questions about payments in QuickBooks. I'd be happy to help you out. Have a great day.

APalozzi
Level 1

How should I apply a payment to an invoice when the fees are deducted prior to the bank deposit (Braintree deposits are less than the invoice because the 2.9% fee)

This seems like the right way for me but when I do it this way I get a negative number and it wont let me proceed. customer payment $198.69 + (Previous months merchant fees) $-425.04 = $-226.35. 

"You must specify a transaction amount that is 0 or greater." is the message I receive. 

Joesem M
QuickBooks Team

How should I apply a payment to an invoice when the fees are deducted prior to the bank deposit (Braintree deposits are less than the invoice because the 2.9% fee)

Hello there, @APalozzi.

 

You can create a Check to the specific amount then add a line item for the negative amount. In this way, you can match the transactions to the bank feeds and fix the error message. Let me show you how.

 

  1. Click the + New button.
  2. Select Check.
  3. Choose the Payee from the drop-down list.
  4. Enter the necessary details to match the transaction.
  5. Example: make the payment as the negative amount, then the fee as a positive amount.
  6. Select Save and close or Save and new.

Joesem Molat1.JPG

Once done, you can now match your transactions. Just follow the steps shared by my colleague on how to much them. 

 

I’m adding an article that can help in your future tasks. It contains resources to get you on the right track handling bank feeds and other banking activities: Self-help articles.

 

You're always welcome to comment below if you have any other concerns. I'm just around to help. Take care always.

 

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