Creating/applying customer credit

Hi there - I'm new to reckon. A customer that rents a property off us had 2x invoices due but paid for some expenses on their side for maintainance of the property. Instead of us reimbursing (which would have been easier for me!) they paid their invoices, less what we owe them for reimbursement. I'm struggling to work out how to track this in our system - I've tried setting up an adjustment note but the 'credit' im giving them ends up back in one of our bank accounts for some reason. Could anyone walk me through step by step how I should apply the credit?

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Acctd4

Welcome to the forum @FarlowGroup !

Create a “Clearing” bank account - This is a dummy bank account used for the purpose of receiving & making contra payments.

Receive Payment - for the FULL amount of the invoice - Depositing to the Clearing account.

Write Cheque - OUT of said Clearing account - for your reimbursement to the client.

You will now be left with the NET amount that the client actually paid. Write Cheque (or Transfer Funds to move this into your main bank account (as per deposit you actually received) 😁

FarlowGroup

Thanks @Acctd4 - I already have 'undeposited funds' - is this different? I can't choose this as somewhere to write a check from, or pay a bill from.

Can set up a clearing account - is this just set up as a regular bank account? Other forums i've found tell to set up as 'expense'.

Acctd4

Undeposited Funds is a separate holding account (like a physical, bank “Deposit book”) whereas yes, the clearing account is a Bank account - definitely NOT an Expense account! - so that it can be used for receiving payments in/making payments out 😊

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