Pass Through Payments

Say I have a service where a customer pays for my company for a purchasing service and prepays the cost of an item I will be ordering for them. Is it best practices for me to log that item payment as an income for my business even though it is not, technically, a payment to my coffers. It is simply passing through my account from customer to vendor. Since it goes through my bank account, I am assuming it needs to be accounted for, so I log it as an income and then it is logged as an expense on the other end which creates a net zero in my accounting. However, it then shows as an income which, to me, seems inaccurate because it isn’t part of my company’s income (or is it).

The question of whether such an item should be counted as income (and then be offset by the expense of purchasing it) is one for a local tax authority or accountant. Based on what your profile says about where you live, it would result in no net taxable income. In other jurisdictions, it might be important to account for this as part of “turnover.”

Regardless, record such expenses in Manager as billable expenses. When invoiced, this will result in the income being posted to Billable expenses - invoiced and the expense to Billable expenses - cost, for a net of zero. See and