How to Pay Bills with a Credit Card in QuickBooks Online

Paying bills is a regular part of managing business finances. But writing and mailing paper checks takes effort. What if you could use your business credit card to pay your bills right in QuickBooks Online?

With QuickBooks Bill Pay you can. This convenient feature allows you to pay vendors right within QuickBooks using a linked business credit card.

In this comprehensive guide, we’ll walk through how to pay bills with a credit card in QuickBooks Online Whether you want to earn rewards, manage cash flow, or simplify bill payment, this functionality makes it easy

Overview of Paying Bills with a Credit Card in QuickBooks

Here’s a quick rundown of how paying vendor bills with a credit card works in QuickBooks Online

• Link credit card – Connect your business credit card account to QuickBooks. This enables payment.

• Enter bills: When vendors send you bills, enter them into QuickBooks as usual.

• Click on “Pay with Credit Card.” When you pay a bill, click on “Pay with Credit Card” and then choose your card.

• Make payment – QuickBooks deducts the bill amount from your credit card balance.

• Record payment – When you pay your credit card bill later, record it in QuickBooks to update the balance.

It integrates right into your regular bill payment process. Now let’s look at the steps in more detail.

How to Link a Credit Card to Pay Bills

Before you can pay vendor bills with a credit card in QuickBooks Online, you first need to add the card as an account. Here’s how:

1. Go to Settings in the top menu and select Chart of Accounts.

2. Click New and then select Credit Card as the account type.

3. Enter a name like “Business Visa” and your starting credit limit.

4. Fill in the rest of the card details like number, expiration date, billing address, etc.

5. Click Save and Close to add the credit card account.

Be sure to choose a business credit card with benefits suited for your spending. Now your card is ready to make bill payments.

Paying a Bill with a Credit Card in QuickBooks

Once your business credit card is linked, you can select it to pay vendor bills:

1. When viewing an unpaid bill in QuickBooks, click Pay Now.

2. In the payment window, check Pay with Credit Card.

3. Select the card account you want to pay with from the dropdown.

4. Enter any optional memo and click Pay Bill.

And that’s it! The bill amount will deduct from your credit card balance. You’ve now paid the vendor directly using your card.

Recording Credit Card Payments in QuickBooks

After paying bills with your credit card in QuickBooks, your real-world card balance will be higher. To reconcile this, you need to record your actual credit card payments.

Here are two ways to record paying off your credit card balance in QuickBooks:

Option 1: Enter Credit Card Payment

1. Go to Banking and select Make Credit Card Payment.

2. Pick the card you need to pay.

3. Enter the payment amount and date.

4. Choose the bank account the money will come from.

5. Click Save and Close.

Option 2: Write a Check

You can also record credit card payments in QuickBooks like normal checks:

1. Go to Banking and select Write Checks.

2. Make the check payable to your credit card name.

3. In the account field, choose your bank account.

4. Enter the payment amount and details.

5. Click Save and Close to record the payment transaction.

Either method will lower your credit card balance and raise your bank account balance to match reality.

The Benefits of Paying Bills with a Credit Card

There are a number of advantages to leveraging your credit card to pay vendors in QuickBooks:

• Earn rewards – Business credit cards offer robust rewards programs on spending. Pay bills to rack up points or cash back.

• Deferred payment – Pay vendors immediately while delaying the money leaving your bank account until the credit card due date.

• Float cash – Maintain liquidity in your bank account to manage cash flow. Pay the credit card balance later.

• Track expenses – Credit card payments appear in reporting to monitor spending.

• Accepted everywhere – Unlike checks, credit cards let you pay any vendor electronically.

• Bonus perks – Get card benefits like purchase protection, extended warranties, and rental insurance.

QuickBooks bill pay with credit card combines convenience and control.

Tips for Paying Vendor Bills with a Credit Card

Follow these tips for smoothly managing bills paid by credit card in QuickBooks:

• Pay credit card bills in full each month to avoid interest charges.

• Set payment reminders so you don’t miss the credit card due date.

• Notify vendors before using a card to avoid processing issues.

• Monitor the credit card and bank accounts regularly to catch errors.

• Use the original credit card statement when recording payments for accuracy.

• Transfer bill payment details from the credit card to the check register.

• Only use a card that offers benefits that exceed the fees. Get the right card for your spending.

• Adjust spending limits as business expenditures change so you don’t go over limit.

With some planning, you can optimize this process.

Troubleshooting Credit Card Bill Payments in QuickBooks

While paying bills through a credit card in QuickBooks is generally straightforward, you may occasionally run into issues. Here are some potential problems and fixes:

Credit card balance doesn’t match real balance – If the two diverge, you likely forgot to record a credit card payment in QuickBooks or entered an incorrect amount. Re-check bank and card statements.

Transactions won’t match – When reconciling accounts, a bill paid by credit card might not match up correctly between the credit card and bank transactions. You may need to edit the transaction details like date or amount.

Payment won’t process – If a vendor payment won’t go through via credit card, there may be an issue with the card itself or the vendor account details. Contact the vendor or card provider for help.

Missing bill payments – Run a report of all paid bills for the credit card account. If any are missing, create and enter them manually.

Overall, QuickBooks credit card bill payment runs smoothly as long as you enter the transactions accurately on both sides.

Alternative Options for Paying Bills with Credit Cards

Paying vendor bills directly through QuickBooks via a linked credit card account is the simplest approach. But you also have alternatives:

• Manually record payments – Instead of paying through QuickBooks, you can pay a bill outside the software, then manually enter a credit card payment and matching bill payment after.

• Use bill pay – Some credit card providers offer an option to pay bills directly through their website. You can then match these transactions to the vendor bills in QuickBooks.

• Sync transactions – If your credit card feed syncs to QuickBooks, imported transactions can automatically match to vendor bills.

• Third-party integration – Apps like Plastiq facilitate credit card bill payment through QuickBooks and sync data.

Evaluate whether another approach better fits your workflows.

Get Started Paying Bills with Credit Cards in QuickBooks

As you can see, QuickBooks makes it simple to leverage your credit card to conveniently pay vendor bills and maximize rewards. From setup to recording payments, the entire process integrates smoothly.

If your business frequently pays vendors, consider enabling credit card bill pay in QuickBooks Online to simplify payments. Just link your card, check the option when paying bills, and keep the account balances reconciled.

QuickBooks credit card integration empowers businesses to optimize bill payment and cash flow management all in one place. Reach out to the QuickBooks team if you have any other questions getting set up.