Withholding tax certificate received

Let me help you record the withholding tax certificate received and clear this debtor balance in QuickBooks Online (QBO), Albert-GH.

We can use a credit note to charge off the withholding tax as an expense. This also marks their invoice as paid in full. To properly record the transactions, we'll need to set up a withholding tax expense account. Here's how:

1. Go to the Gear icon on the top menu and select Chart of accounts.
2. Click New.
3. From the Account Type dropdown, choose Other Expense.
4. From the Detail Type dropdown, select Other Expense.
5. Name the account "Withholding Tax Expense", then press Save.

Then, set up a withholding tax expense item by following the steps below: 

1. Go to the Gear icon, then select Products & services.
2. Click New, then choose Service.
3. Name the item "Withholding Tax".
4. From the Income account dropdown, select the withholding tax expense account that you’ve just created.
5. Press Save and close.

Once done, create a credit note and use the credit note on the invoice payment:

1. Click the + New Plus icon.
2. Select Receive Payment.
3. Choose the customer’s name.
4. Under the Outstanding Transactions section, select your customer’s invoice.
5. Under the Credits section, find and select the credit note you created.
6. Press Save and close.

You only need to set up the withholding tax account and item once. The next time you have to charge off withholding tax, just use your existing withholding tax item. Moreover, I'm adding this article that tackles reconciliation to ensure your account is balanced and accurate: Reconcile an account in QuickBooks Online.

I've got your back if you have more questions about managing your business entries. Just leave a comment below and I'll be back.