How to Pay Credit Card Bills in QuickBooks Desktop

Using credit cards to make purchases for your business can provide flexibility and rewards, but it also means you need to properly track and pay those credit card bills in your accounting system. QuickBooks Desktop provides several straightforward methods to enter credit card charges and pay the monthly bill. Follow this guide to learn the step-by-step process.

Enter Credit Card Charges

There are a couple ways to enter credit card charges into QuickBooks Desktop:

• Enter Credit Card Charges window – Access this via Banking > Enter Credit Card Charges This allows you to enter all the details of a charge including vendor, account, amount, etc

• Create an expense or item receipt – When entering a new expense or item receipt, you can select a credit card as the payment method. The charge will be logged to your Accounts Payable.

• Enter bill and select Pay by Credit Card – When entering bills from vendors, you can opt to pay by credit card. This will log the payment to your credit card liability account.

No matter which method you choose, the key is to ensure the charge hits your credit card liability account. This will show an outstanding balance due on that account.

Reconcile the Credit Card Account

You should reconcile your credit card on a monthly basis when you receive the statement. This will match all the charges entered in QuickBooks to the statement balance.

To reconcile:

• Go to Banking > Reconcile
• Select your credit card account
• Enter the statement ending balance
• Match any unmatched transactions
• Click Reconcile Now

Reconciling verifies all charges hit your books properly.

Pay the Credit Card Bill

Once reconciled, you need to record payment of the credit card bill. Here are a few options for paying the bill in full:

• Write Checks – Go to Banking > Write Checks and make the check payable to your credit card company. Be sure to select your credit card liability account so the payment zeros out the balance.

• Enter Credit Card Credit – Go to Banking > Enter Credit Card Charges and enter the payment as a refund. Select your bank account as the payment source.

• Transfer Funds – Go to Banking > Transfer Funds and transfer from your bank to the credit card. Select the payment clearing account.

No matter which way you pay, the key is reducing your credit card liability account balance to zero when the bill is paid in full.

Pay More Than the Statement Balance

Sometimes you may need to pay more than just the statement balance. For example, if there were new charges after the statement date that you want to pay early. In this case, you will need to enter those new charges to the credit card account first before making the larger payment.

Here is an example:

• Statement balance is $1,000 on 6/25
• Enter $100 in new charges on 6/27
• When paying the bill, the payment will be $1,100

Be sure your credit card account balance matches the total you need to pay before making the payment transaction.

Pay Less Than the Full Balance

If you cannot pay the credit card bill in full, you will need to make a partial payment instead. Here are the steps:

• Reconcile the account to match against statement balance (e.g. $1,000)
• Go to record payment transaction
• Enter the amount you will partially pay (e.g. $500)
• Your credit card balance will now show $500 due

When making a partial payment, your credit card account balance will be reduced but not fully paid off. The remaining balance will roll over to the next month.

Tracking Finance Charges

If your credit card company charges finance fees or interest, you’ll want to track these charges separately in QuickBooks. When you get your statement, look for the interest charge amount and enter it as a new charge transaction to an account called Interest Expense or Finance Charge. This will ensure your expense reporting is accurate.

Let QuickBooks Auto Pay Bills

You can save time by setting up QuickBooks to automatically pay your credit card bill each month. Go to Banking > Online Banking Center and set up a recurring payment rule. This is helpful to make sure payment is on time if you tend to forget bills. Just be sure your credit card balance matches the payment amount before auto pay runs.

Reports to Review Transactions

QuickBooks offers several reports to view your credit card transactions and payments:

• Credit Card Activity – Shows all charges and payments by card
• Reconciliation Discrepancy – Displays transactions not cleared from reconcile
• Open Credit Card Charges – Outstanding charges due on each card

Get Help from a QuickBooks ProAdvisor

If you need help getting set up to pay bills on time or troubleshooting issues, connecting with a ProAdvisor is recommended. These accounting professionals can guide you with best practices tailored to your business needs. Visit QuickBooks.intuit.com to get connected with one today.

Key Takeaways on Paying Credit Cards in QuickBooks

• Enter charges using a dedicated CC transaction, bill, or expense
• Reconcile monthly when you receive the credit card statement
• Pay the balance using Write Checks, Credit Card Credit, or Transfer Funds
• If paying partial or more than statement amount, adjust the transaction amounts
• Track interest and finance fees in separate accounts
• Review credit card reports to verify transactions
• Get help from a ProAdvisor to handle bookkeeping tasks

Following these tips will help ensure your credit card accounts stay up to date in QuickBooks and prevent late fees from missed payments. Reach out to the QuickBooks support team for any questions!