Our team is reviewing the requirements necessary for implementing the ability to automatically charge late fees for overdue invoices. Stay tuned!Ted Kennedy commented
I made this post earlier, but just to make sure, here's how to do it:
1. Have a default finance charge rate which is applied to all new customers, and a default account to which finance charges are credited.
2. Allow the rate to be changed for each customer, or to turn off finance charges for the customer.
3. When sending statements, have a last-minute override to not charge finance charges, in case there is some unusual circumstance.
4. Compute the finance charge and add it to the statement, but do not make an entry for it in QBO. (It really should NOT be part of the invoice - that makes the invoice inaccurate).
5. When applying payments to invoices, have a Finance Charge field on the data entry screen. If the customer paid a finance charge, the amount goes in that field and is credited to the account defined in step #1. If the customer doesn't pay the finance charge, you just let it go. You're glad to get the payment and you might make a note to require prepayment from the customer in the future.
This is a very simple and elegant way to handle finance charges.
It is not accurate to add the finance charge to the invoice. It doesn't belong there - it is the result of the customer not paying the invoice on time, not something that was originally charged to them.
QBO should have had this feature right from the beginning! It is a normal, fundamental part of an accounting system, and one that is VERY easy to implement when done as outlined above.
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