How to automate loan payment split (principal vs. interest) in QuickBooks Online?
I’m working in QuickBooks Online (Canada) and I need help recording a large loan properly and managing the ongoing monthly payments. Here’s my situation:
1. Loan Setup
• I have a loan from the bank (multi-year, fixed interest rate, regular monthly payments).
• I already know the loan amount, the interest rate, the number of payments, and the fixed monthly payment amount.
2. Current Process
• Each month, when I make the payment, it needs to be split between:
• Principal (which reduces the liability in the Loan Payable account)
• Interest expense (which shows up on the P&L).
• Right now, I’m manually checking the bank’s amortization schedule, splitting the transaction in QBO, and posting it.
3. What I Want to Do
• Ideally, I’d like to automate or simplify this process in QuickBooks Online.
• Is there a way to set up a recurring transaction that calculates the changing principal vs. interest portion automatically each month?
• Or do I always have to manually calculate the split from the amortization table and update the journal entry before recording it?
• What’s the best practice other QBO users are following for this type of loan repayment?
Any guidance, tips, or workarounds (including integrations or apps if needed) would be really appreciated!
