Usually there is no fee you have to pay to pay a supplier’s (vendor’s) bill. What can happen is that bank only deducts one amount that includes the bill payment plus the transaction fee. They are combined. However, in your QuickBooks accounts you have to record two different expenses.

On the day you pay the bill and the fee you can enter a separate bill just for the payment fee. The payee must be the same as the original bill. The expense should be “bank fees expense” or something similar. The date of that bill must be the date you actually pay the bill. You can put the name of the payment platform in the description.

How do we enter these in QuickBooks? Enter the original supplier’s bill as you normally would. Create a new bill for the fee. The Supplier is the same, but the date is the date you are paying and the Category is “Bank Fees Expense” unless you’ve created a separate account.

When we have both we go over to + New, Pay Bills. Filter for all dates. Filter for the supplier in question. Put check marks on both the original bill you are paying and the fee. Click Save and Close.

You should not edit the original bill and add the fee. The date of the Bank Fee Expense is the date you pay the bill, not the date of the original bill.

Remember that we are paying online using PayPal in our example here, so we are recording an actual transfer of funds.

Go to the Unpaid Bills report. You might want to memorize this one for All dates. Use the Classic report. The bill we were paying, and the fee is not there. That’s good.