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devapatir
Level 2

Split cutomer invoice payments

We invoice a foreign customer who pays in dollars for example $40,000.

But he witholds 25% for local taxes, that is, $10,000 and pays $30,000.

How do I record the invoice payment amount and the taxes paid to the expense account.

Thanks

 

 

2 Comments 2
Jen_D
Moderator

Split cutomer invoice payments

Thanks for the in-depth information about you concern, @devapatir,

 

Recording an invoice payment alongside with the fees and tax expense is easy. I've outlined a step-by step process for you to follow:

 

Step 1: Create the customer's invoice.

  1. Go to the Customers menu.
  2. Select Create Invoices.
  3. Enter the exact amount to be invoiced ($40,000). See screenshot below:

Step 2: Receive the full invoice payment then save it to the Undeposited Funds account.

  1. On the invoice, click the Receive Payments icon.
  2. Select the correct invoice to pay.
  3. Click Save & New or Save & close. (See screenshot attached)

Step 3: Enter a Bank Deposit with the local tax to get the deposit the $30,000. (See screenshot)

  1. From the Banking menu, select Make Deposits.
  2. Mark the invoice payment you made from the Payments To Deposit screen, then click OK.
  3. (Optional) In the Received From column, enter the tax agency as a vendor.
  4. In the From Account column, add an expense account for the local tax.
  5. For the Amount field, enter a negative fee amount (-$10,000). Make sure the deposit matches the net bank deposit amount.
  6. Hit Save and close.

 

 

For other tasks and features in QuickBooks Desktop, check out our user guide here.

 

If you have follow-up questions about this, let me know in the comment below. I'll be available to help you at any time. Have a wonderful day!

devapatir
Level 2

Split cutomer invoice payments

Works perfectly. Thanks

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