QuickBooks Online FAQ

QuickBooks Online FAQ

QuickBooks Online Tutorial/Help Links

QuickBooks Online Offer chat that can be accessed in-app.
Full QuickBooks Online Video Tutorial List https://quickbooks.intuit.com/learn-support/en-us/help-custom/L8onrlA6N
QuickBooks Online Video Tutorial YouTube Playlist https://www.youtube.com/watch?v=qnvJgUoKw-I&list=PL7wXuoHynGQC3tZvht50IjFWb0ROMXBMk

What journal entries does Loft post to QuickBooks Online?

Processing transactions through Loft automatically generates the accounting entries in QuickBooks Online. The following descriptions show you the results of Loft activities in your accounting records.

Deposits

Bank deposit: Debits the Bank account (Receiving account), credits an offset Liability account –– Trust liability and/or Commission Payable Liability depending on the Receiving account. Each entry links to the related deal in Loft, and can be reconciled with your bank feed when the transaction appears. If you choose to request the funds via invoice for the deposit Loft will then post an invoice to the contact name you enter on the deposit page. You can track entries by the Agent’s office when using departments or classes on transaction lines.

Transfers Between Bank Accounts

When you transfer funds between bank accounts in Loft, two entries are created. In this example there's a transfer between the Trust/Escrow account and the Commission Account)

Spend transaction (bill) – Credits the Spending account (Trust/Escrow Account) and debits its offset account (Trust/Escrow Liability or Commission Payable Liability).

Receive transaction – Debits the Receiving Account and credits its offset liability account.

Payments/Bills to Agents or External Brokers

Per Trust/Escrow rules, payments to external brokerages must be made from the Trust account. During onboarding, Loft47 helps you:
  1. Set up the correct payment accounts
  2. Configure agent deductions and split fees, each linked to a specific GL account
  3. Mark deductions as payables (if applicable), triggering bill creation
Each deduction is linked to a specific general ledger account. If marked as a payable, Loft47 creates a bill for the amount owed.  Loft47 records commissions, applies deductions, and clears any payables from the deposit. 
Bills appear in QuickBooks Online and can be paid by check or any integrated digital payment method. Journal entries include clearing the payable balances.

A pay stub for each agent is available within the deal in Loft.

How Gross Commissions appear on your QuickBooks Online Income Statement

Commission Mapping Overview

When setting up your Brokerage, we use a standard commission mapping that a majority of Brokerages use. This setup allows for easy comparison between gross commissions and Expenses (outgoing payments) and helps calculate your Brokerage's true income as a percentage of gross commissions.

Default Accounting Mapping

(for systems like Xero/QuickBooks Online)
Income Accounts
Commission Income – Total gross commissions on all deals.

Income to the Brokerage – Fees retained by the Brokerage from agent commissions.

Cost of Sales / Expense Accounts (“Direct Cost” or “Expense” )

Commissions Paid to Agents – Full commissions allocated to agents (not net pay).
Commissions to Outside Brokers – For payments made to third-party brokerages (if applicable).
This structure ensures clarity in reporting and simplifies income tracking.

Sample Profit & Loss Statement
A typical Profit and Loss (P&L) statement—also called an Income Statement—shows a business's revenues, costs, and expenses over a specific period (e.g., monthly, quarterly, or annually). It provides insight into the company’s profitability.

Standard structure of a P&L statement

1. Revenue / Income
Gross Sales or Revenue
Commission Income
Other Income (e.g., referral fees, consulting income)

Total Revenue

2. Cost of Sales (Direct Costs)
Commissions Paid to Agents
Commissions to Outside Brokers
Referral Fees Paid

Total Cost of Sales

3. Gross Profit 
(Total Revenue – Total Cost of Sales)

4. Operating Expenses
Salaries & Wages (non-commission)

Office Rent
Marketing & Advertising
Technology & Subscriptions
Professional Fees (Legal, Accounting)
etc

Total Operating Expenses

5. Operating Profit
(Gross Profit – Operating Expenses)

QuickBooks Online Sales Tax - Canadian Clients

Unfortunately, the QuickBooks Online API will not allow Loft to post sales tax the same way the Xero integration does. As in Xero when you post an Agent's payout it's posted as a bill in QuickBooks Online, this bill will include posting the top line commission expense and income as well as the income GL's associated with any fees deducted.

With the Xero integration, the tax on purchases is posted on each expense line and tax on sales on each income line, this is not the case for QuickBooks. QuickBooks Online will only allow posting either the credit or debit to a tax on purchases type, as a result we've created special tax rates in the Canadian version of QuickBooks Online making the manual adjustment you'll need to do very straightforward. 

Setup Sales Tax Rate

Please set up the following custom Tax Rates in your Quickbooks Tax Rate Settings:
  1. Loft Sales Tax Flowthrough
  2. Loft Tax on Sales
Please note, the percentage should be the same rate as your Provincial tax rate.


Map Tax Rates in Loft

Navigate to your Integrations/QuickBooks Online/Settings/Tax Type and expand the dropdown.
Map the following fields:
Sales Loft Tax on Sales
Purchases  Loft Sales Tax Flowthrough
Exempt Sales  Exempt Rate - (0.0)
Exempt Purchases  Exempt Rate - (0.0)

Manual Monthly Journal Entry Adjustment

You will only need to complete this manual process once per filing period so once a month, once a quarter or possibly even just once a year. Post your deals and payouts as usual. When it's time to file sales taxes, simply follow this quick process to reallocate the tax from the flow-through account to the correct Revenue Canada sales tax category.

Step 1 Pull Report

In your QuickBooks/Report page, head to the 'Transaction Detail by Tax Code Report' and set the date range to your desired reporting range. 

Run the report
In the report you will locate the total tax amount of sales at the bottom of the section labelled 'Loft Commission flow through' in this report. this is the total for your Commissions and taxes for the date range you selected.

To determine the amount you're going to enter you can take the value that you are correcting for, in this case from above it $286.16 and divide it by the tax rate for your province. In this case it is 5%. $286.16 / .05 = $5,723.20.

Step 2 Add Manual Journal Entry

Your Journal Entry should be as follows:

Line 1
Account :2947 Commission clearing account (or the compatible account in your Chart of Accounts)
Credits: (the total Commission amount found in your Report you pulled earlier)
Description: Reallocate tax on Sales
Sales tax: Loft Tax on Sales (sales) 

Line 2
Account :2947 Commission clearing account (or the compatible account in your Chart of Accounts)
Debits: (the total Commission amount found in your Report you pulled earlier)
Description: Reallocate tax on Sales
Sales tax: Loft Sales Tax Flowthrough



Step 3 Pull Sales Tax Report

In QuickBooks Online, head to your Reports>GST/HST Report and set the same date range as your previous report.
You should see that total be added to the outstanding tax on sales from other transactions. You're good to go!


Can't see your transaction from Loft47 in QuickBooks Online?

If you're unable to see your transactions in QuickBooks Online after you've done a completed batch has processed in Loft47, there could be a couple of reasons for this.
1. You haven't let the batch fully run.  Wait until it's run and check the status.
2. You have multiple browser tabs open and you need to refresh the tab you have QuickBooks Online  is in to see the transactions updated in QuickBooks Online 
3. There's a transaction error in the batch.  90+% of errors are because a contact is a duplicate either on the Loft47 side or in your accounting software's contacts and/or the contact in Loft47 is incorrectly linked to their respective contact(s) in your accounting software. 
You ​​​​​will need to know how to identify and troubleshoot those errors using this article https://support.loft47.com/portal/en/kb/articles/accounting-batches 
If the contact is a duplicate in Loft47, you will need to follow the steps in this article https://support.loft47.com/portal/en/kb/articles/merge-contacts#How_to_merge_contacts
If the contact is incorrectly linked, you will need to follow the steps in this article https://support.loft47.com/portal/en/kb/articles/accounting-batches#INCORRECTLY_LINKED_CONTACTS

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