DISCLAIMER: Nothing in this article or related to your QuickBooks Online integration with Housecall Pro is intended to be accounting or tax advice. We highly recommend you work with an accountant for any tax or accounting questions, including any related to this product. There may be slight discrepancies between what you see in your Stripe Capital repayment dashboard and what you see in Quickbooks Online.
We know how much of a headache accounting can be, which is why we take care of reconciling your Stripe Capital loan payout and repayment in QuickBooks Online. Spend more time thinking about how to use your funds, and less time on tracking repayment!
In this help article, we’ll detail how a few key features of the Stripe Capital product integrate with QuickBooks Online.
We’ll use these loan terms as an example throughout this help article:
Loan amount: $10,000.00
Flat fee: $2,000.00
Repayment rate: 10%
LOAN PAYOUT & GENERAL LEDGER ACCOUNT CREATION
When your Stripe Capital loan is paid out, we will increase the balance of your default checking account by the amount of your loan. We will also automatically create two new accounts in QuickBooks Online: a liability account for recording the amount of your loan (and how much you have left to pay against the balance), and an expenses account for recording repayment against your loan’s flat fee. We will also create a new vendor to help keep things organized. Details on all this below:
^ When your loan is paid out, you’ll see in your Chart of accounts a new liability account (teal) and an expenses account (blue).
When your loan is paid out, we will increase the balance of your default checking account by your loan amount.
If we use the example above, the balance of your checking account would increase by $10,000.00 when your loan is paid out.
^ In this example, a Pro's checking account balance is increased by $10,000.00 when a $10,000.00 loan is paid out. You can see a newly created vendor (purple) and liability account (teal) associated with this deposit.
This short-term liability account will help you keep track of how much of your loan amount remains to be repaid. The balance will decrease as you repay your loan.
If we use the example above, the balance would be $10,000.00 when your loan is paid out. The balance would be $0 when you are done repaying your loan.
This account will be named
Stripe Capital (via Housecall Pro) - Loan 2/18/2022
The date on this account name will correspond with the payout date of your loan. In the example above, the loan payout date is February 18, 2022. The date is so you can keep track of different accounts if you take more than one Stripe Capital loan.
^ This Pro’s newly created liability account had a $10,000.00 initial balance. The account shows $9,975.00 left to be repaid after a $25.00 repayment against the loan amount.
This account will help you keep track of how much of your flat fee has been repaid (since the flat fee is considered an expense). The balance will increase as you repay your loan.
Using the example terms above, the balance would be $0 when your loan is paid out. The balance would be $2,000 when you are done repaying your loan.
This account will be named
Stripe Capital (via Housecall Pro) - Fees
^ This Pro’s newly created expenses account starts at $0.00 (when the loan is disbursed) but shows a balance of $5.00 after a $5.00 repayment against the flat fee processes.
When your loan is paid out, we will create a vendor called
Stripe Capital (via Housecall Pro) - Vendor.
This vendor will be associated with both the loan payout and any repayment bank deposits.
^ At the time of loan disbursement, you’ll see this newly created vendor pop up in your account!
When you take credit card or ACH charges through HCP, repayment toward your Stripe Capital loan will get automatically and seamlessly updated in your newly created QuickBooks Online accounts. You will see line items in your bank deposits detailing how much of each payment you take went to repayment of the liability (your loan amount) and the expense (your loan’s flat fee).
Let’s say your customer just sent you a $300.00 credit card payment for a job. Using the example loan terms above, how much would go to loan repayment? What amounts would get reflected in each of your newly created accounts?
Using the same sample terms as above, if you took a $300.00 credit card payment for a job at a 10% loan repayment rate, $30.00 would go toward your loan repayment. Some ($25.00) of this repayment would go toward paying down the liability (your $10,000.00 loan), and the remainder ($5.00) would go toward paying down your flat fee (the $2,000.00 you’re paying for the loan). The amount of the repayment that goes toward repaying the liability vs. the flat fee is calculated consistently for each payment you take.
^ In the screenshot above, a $300.00 charge has $30.00 being repaid toward a Pro’s loan (assuming at 10% repayment rate). When this deposit goes through, the Pro’s loan-specific liability account (teal) balance will decrease by $25.00 and the Pro’s loan-specific expenses account (blue) will increase by $5.00. There may be additional line items for things like credit card processing fees, but these are independent of any loan repayment calculations.
^ In the screenshot above, the Pro’s liability account balance decreases from $10,000.00 to $9,975.00 after repayment from a $300.00 job that had a 10% repayment rate and $2000.00 flat fee. In this scenario, $25.00 of the $30.00 went to repaying the loan amount, as reflected in the liability account.
^ In the screenshot above, the Pro’s Stripe Capital-specific expenses account balance increases from $0.00 to $5.00 after repayment from a $300.00 job that had a 10% repayment rate and $2000.00 flat fee. In this scenario, $5.00 of the $30.00 went to repaying the flat fee, as reflected in the expenses account.
SPECIAL CASES & FAQ
What if I accidentally delete an account that was created for me?
You will need to restore the account. Please chat in if you need help with this.
How should I report these funds on my taxes?
Tax reporting is often dependent on your specific situation, so we encourage you to talk with a tax advisor to ensure appropriate accounting and tax reporting. In general, Stripe Capital funds would not be considered taxable income at the time of receipt, and the amounts withheld to satisfy your obligations are not tax deductible.
Why are my repayments separated into two accounts (liability account and expenses account)?
This is to reflect the amount paid against your Stripe Capital loan and the amount paid toward your flat fee. Please discuss the appropriate accounting treatment with an accountant or tax advisor.
Why is my liability account of type “Other Current Liabilities” (aka a short-term loan)?
This is because the anticipated repayment period for a Stripe Capital loan is less than 12 months.
What if I take out more than one Stripe Capital loan?
Please note that it is only possible to have one Stripe Capital loan active at a time. If you do fully repay a loan, it is possible Stripe will offer and fund another. In this scenario, there are a few things to keep in mind:
Liability account: The new loan will be reflected in a new liability account (which will have a name that corresponds to the payout date of the new loan).
Example, Loan #1:
Stripe Capital (via Housecall Pro) - Loan 2/18/2022
Where 2/18/2022 assumes a loan disbursed on February 18, 2022.
Example, Loan #2:
Stripe Capital (via Housecall Pro) - Loan 11/25/2022
Where 11/25/2022 assumes a loan disbursed on November 25, 2022.
Expenses account: We will not create a new expenses account for recording repayment against the flat fee. Repayment against the new loan’s flat fee will populate to the same expenses account we created for you with the first loan (Stripe Capital (via Housecall Pro) - Fees). You can filter on vendor and date to determine repayment that has occurred specifically against the flat fee of your new loan.
I made a manual payment against my loan. Does this get automatically reflected in QuickBooks Online?
No. At the moment, reconciliation of manual payments against your loan are not automatically recorded in QuickBooks Online. For support with this, please chat in.
What if I connect to QuickBooks Online after taking out a Stripe Capital loan?
Unfortunately, your loan payout and repayment will not automatically reconcile if you connect your HCP account to QuickBooks Online after taking out a Stripe Capital loan. Please discuss with an accountant or tax advisor how to reflect this in your QuickBooks Online account.
Looking for more of a generic overview of HCP's business financing with Stripe Capital? Head here: