cancel
Showing results for 
Search instead for 
Did you mean: 
Highlighted
Frequent Explorer *

Repair Shop Sublet Repairs

I have a mobile tractor repair business. I am too busy right now and cant take on any more work. I have a friend that also has a mobile tractor repair business and has offered to take on a few of my open jobs that i can't get to. He wants to bill me, and then I bill the customer. He will have labor involved and most likely he will charge me for any parts he had to purchase to fix the tractor. How to i categorize the invoice he sends me (the expense)? I have read this would be considered sublet repair? Is he Sublet Services Cost - COS? Or is there a different way if hes set up as a contarctor? Do i set him up as a contractor? Also how do i categorize the invoice i send the customer? Do i charge the customer labor hours and parts like i normally do? What is the proper way to categorize this whole scenario in QBO? Thank you in advance. If you need anymore information feel free to ask. 

Solved
Best answer 02-01-2019

Accepted Solutions
Established Community Backer ***

Re: Repair Shop Sublet Repairs

Set him up as a vendor, if you are in the US mark him as eligible for a 1099.

his invoice to you is your bill, in the US payments to 1099 contractors report in one block called non employee compensation when filing taxes so I use that name for the expense account.  If you are not in the US I would just name it contractor expense.  What he includes in the bill makes no difference, parts, labor etc it is all your one expense

Use a service item to invoice your customer, same amount as the bill or mark it up some.

Another option is, if you have QBO Plus, to turn on and use billable expenses.
In company settings turn on make expenses and items billable
check mark to track billable expenses and items as income
then in company settings>advanced>chart of accounts click the edit pencil and select the billable expense income account

Why intuit separated the two related settings is anyone's guess

When you enter a vendor bill/CC charge/etc, you will see a Billable check mark box, check that and select the customer name in the customer block. The next time you invoice your customer, the system will show billable expenses on the right side that you can click the add link to add the bill to the invoice.  IF you do not want to add the bill to the invoice, leave the billable check mark box blank, the cost of the expense will still count against the customer

Established Community Backer ***

Re: Repair Shop Sublet Repairs


@T49ers68 wrote:

Thank you very much for the information. I am in the US and use QBO+. I will set up an expense account named non-employee compensation. I am still confused what category to pick to set up this new expense account (please see attached picture). I also noticed as soon as i selected track payments for 1099, he appeared under contractors tab under workers column. That alone really answered question i had. Thanks again. I really appreciate the help.


ahh intuits invented detail type

when in doubt use other business expenses, and click the name block and title as you want

 

detail type is something intuit invented in QBO only, it just confuses folks and for the most part just names the account you are creating.

3 Comments
Established Community Backer ***

Re: Repair Shop Sublet Repairs

Set him up as a vendor, if you are in the US mark him as eligible for a 1099.

his invoice to you is your bill, in the US payments to 1099 contractors report in one block called non employee compensation when filing taxes so I use that name for the expense account.  If you are not in the US I would just name it contractor expense.  What he includes in the bill makes no difference, parts, labor etc it is all your one expense

Use a service item to invoice your customer, same amount as the bill or mark it up some.

Another option is, if you have QBO Plus, to turn on and use billable expenses.
In company settings turn on make expenses and items billable
check mark to track billable expenses and items as income
then in company settings>advanced>chart of accounts click the edit pencil and select the billable expense income account

Why intuit separated the two related settings is anyone's guess

When you enter a vendor bill/CC charge/etc, you will see a Billable check mark box, check that and select the customer name in the customer block. The next time you invoice your customer, the system will show billable expenses on the right side that you can click the add link to add the bill to the invoice.  IF you do not want to add the bill to the invoice, leave the billable check mark box blank, the cost of the expense will still count against the customer

Frequent Explorer *

Re: Repair Shop Sublet Repairs

Thank you very much for the information. I am in the US and use QBO+. I will set up an expense account named non-employee compensation. I am still confused what category to pick to set up this new expense account (please see attached picture). I also noticed as soon as i selected track payments for 1099, he appeared under contractors tab under workers column. That alone really answered question i had. Thanks again. I really appreciate the help.

Established Community Backer ***

Re: Repair Shop Sublet Repairs


@T49ers68 wrote:

Thank you very much for the information. I am in the US and use QBO+. I will set up an expense account named non-employee compensation. I am still confused what category to pick to set up this new expense account (please see attached picture). I also noticed as soon as i selected track payments for 1099, he appeared under contractors tab under workers column. That alone really answered question i had. Thanks again. I really appreciate the help.


ahh intuits invented detail type

when in doubt use other business expenses, and click the name block and title as you want

 

detail type is something intuit invented in QBO only, it just confuses folks and for the most part just names the account you are creating.

Need to get in touch?

Contact us