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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?

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Best answer 10-19-2018

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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.

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Highlighted
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

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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.
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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.  

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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)

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.

 

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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)

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?

 

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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. 

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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?

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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.

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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?

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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!

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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! 

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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.

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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.

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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!

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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?

Highlighted
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. 

Highlighted
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?

Highlighted
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.

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