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Fee's taken out of Payment - how to add into system

KylieD
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76 Posts
Trusted Cover User
Australia
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Fee's taken out of Payment - how to add into system

Hi Everyone

 

Our business just sold a property.

We did an invoice for the full amount (lets say$10k)

 

When we got paid we did not receive the full amount as the lawyer took their fees and other fees out of the payment - so lets say we only received $8.5k

 

How do I clear the invoice, which is short and how do i add in the fee's so they show in the accounts but do not need to be paid since they already have been???

 

I am sooo lost

 

thank you heaps in advance.

 

 

2 REPLIES 2
gavin12345
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Re: Fee's taken out of Payment - how to add into system

Hi @KylieD 

 

Numerous ways to handle such a situation. I would recommend the simplest is to break the transaction into a series of transactions recorded the way you would have wanted. For example rather than record that you received $8.5k, process a Receive Payment for the full amount $10k, then record a payment for the fees as a separate $1.5k transaction to the lawyer - this can be done as a Purchase and Pay Bills or simply as a Spend Money transaction depending on what you are more familiar with. This way when doing reconciliation you will have 2 transactions to net off against the actual bank deposit of $8.5k. If you use Bank Feeds you may need to adapt accordingly. Add notes to memo fields linking the transactions so that when you look at this in 12 months time you can understand what happened.

 

Regards

Gavin

KylieD
Trusted Cover User
76 Posts
Trusted Cover User
Australia
Trusted Cover User

76Posts

24Kudos

4Solutions

Re: Fee's taken out of Payment - how to add into system

Thanks heaps Gavin, I did exactly what you suggested and works out fine.

thanks for your  help, really appreciate it

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