tips

Hello, @Leon D. 

Thanks for taking the time to reach out to the QuickBooks Community for support. I hope you're enjoying the day so far. 

QuickBooks Online has a new feature where you can record tips or gratuities with your employees without needing to set them manually. All you need to do is turn on the Tip Tracking feature.  Here's how: 

1. Select the Gear icon.
2. Under Your Company, click on Account and Settings.
3. From the left menu, tap Sales.
4. Hit the pencil icon on the Sales form content section.
5. Check the Tips (Gratuity) box.
6. The Who's receiving these tips? window opens, select My Team button.
7. The Update your sales receipt template? window opens, click the Update button.
8. Select Save, then Done.

Once you've turned on the Tax Tracking feature, you're ready to record them. How you record them will depend on how your company handles them. Rather its needing to include them on sales receipts, an employee's paycheck, or if your business pays out tips before depositing them into the bank. You can check out Share tips with your team for additional information and steps. 

In addition, to see details about handling service charges in QuickBooks Online, check out Add service fees manually to invoices.

Please let me know if you have any questions or concerns. I'll be here every step of the way. Take care!

Tori,

Thank you so much for the reply.  I did adjust my settings, but I don't think this solves the exact question I was asking.  Perhaps I can try again and add more details.

I make sales in a restaurant using Square.  Customers often add tips to their bill within Square.

Every day Square sends my prior day's Revenues less their fees to my bank account.  These transfers include various different types of sales, taxes and tips all lumped together.

I then go into the bookkeeping section of QuickBooks, look at the bank transactions and start classifying them.  

For the Income transactions from Square, I split each one using a report that Square lets me run.  I'm able to assign parts of each payment to the correct GL code.  Thus, I have a record in QB for different types of food sold, different Sales Taxes and then there are Tips.

I'm trying to figure out if I need to create a new GL code for tips, and if so, is it a Revenue code or a Liability on the B/S?  If it's a Liability, do I then need to split each payment that I make to my employees into a Payroll Expense piece and a Liability reduction piece for the tips received in that payment?

Thank you again for your explanation.