Hello there, iconstruction_ll,
Let's add a line item so we can record tips in your invoices
By doing so, you'll be able to keep track of your customer's tips. Before recording it directly to your invoice, let's perform the step-by-step process provided below.
First, you need to choose an account to use for your tips (if you haven't added one yet). Here's how:
Next is to set up a Product/Service called Tip and use it in adding a line item in your invoice. Please follow the steps below:
After completing the process above, you can now add tips as a line item by editing an existing invoice, creating a new invoice for just this tip, or creating an invoice including the tip amount in it.
For additional information, you can go refer this article: Add tips to Sales Receipts.
In the future, in case you want to pay your employees with tips in their paychecks, you can follow these steps:
Please don't hesitate to leave a comment if you have further concerns about entering tips in QuickBooks Online. I'm just around if you need help.
I have customers who pay their invoice online and will include a tips. The tip is considered an overpayment of the invoice. If I record the tip as an item on the invoice, won't it affect my sales revenue and be included in my sales tax report?
Second, when creating a new service item for tips, do I select the "income account" to a tip current liability account and uncheck the box "is taxable"?
Thanks in advance.
QuickBooks Online has feature that allows you to add tips, however it is only available for sales receipts.
For invoices, there are two ways to add the tips. You can include it as an item on the invoice, or add it when you deposit the invoice payment.
The tip item won't affect your sales revenue as long as you set up the associated account correctly.
The tip account is created automatically once you turn on the Tips feature. Though, here's how you can create it manually:
Then, let's associate the account to the tip item:
You can now use this when you create the invoices. And you'll notice that the system will only calculate the sales tax for the taxable items.
Let me know if you you need more assistance with this.
I'm working on Quickbooks desktop pro 2023. I also use square for my billing and then transfer the amounts into quickbooks. I dont see the "gear" icon. Can you please advise me how to set up an account for tips that customers pay online when they are using their CC to pay for invoices I have sent them through the square app?
Hi there, sharonakd.
You'll need to connect your Square account to QuickBooks Desktop so the transactions are shared from Square to QuickBooks smoothly. However, there isn't a way to directly connect the two, so you will need a mediator app to link them both.
Here's how to find a mediator app:
If you have any other concerns, please hesitate to go back to this thread. Take care and have a good one!