How to Set Up Commission to Outside Reps as an Item in Quickbooks
By Adrian Grahams
Many companies supplement their own in-house sales staff with independent contractors or rely totally on freelance representatives to sell goods and services on their behalf. To record commission payments for outside sales representatives in QuickBooks business accounting software, set up each sales rep as a vendor with 1099 tax status and then add each one to your rep list. You can then add the rep as an item to each customer invoice or sales receipt to ensure that commission is recorded and paid correctly.
Add the Sales Rep to the Vendor List
Click "Vendor Center" in the top menu and then select "New Vendor."
Enter the rep's name in the applicable field.
Click the "Additional Info" tab.
Enter the rep's tax ID into the relevant field and then click to select the "Vendor eligible for 1099" check box.
Click the "OK" button, or click "Next" if you want to set up another rep as a vendor.
Add the Sales Rep to the Rep List
Click "Lists" in the top menu bar.
Select "Customer and Vendor Profile Lists" from the drop-down menu and then select "Sales Rep List."
Click the "Sales Rep" button toward the bottom of the screen and then select "New."
Select the rep's name from the drop-down list.
Click the "OK" button, or click "Next" to add another rep to the list.
Add the Rep to Invoices or Receipts
Click "Lists" in the top menu and then select "Templates."
Click the form you want to customize, such as the invoice or sales receipt form.
Click the "Templates" button and then select "Edit" to launch the Customization window.
Click the "Additional Customization" button. Click to select the "REP" check box so this shows on the screen when you create invoices or sales receipts.
Click "OK" and then "OK" again to save the changes and exit the Customization window. You can now assign each invoice or receipt to a sales rep from the drop-down list in the form to ensure commission is paid to the correct outside sales rep.
After setting up the sales rep on your system, use the QuickBooks reporting tools to create a "Sales by Rep Summary Report" that calculates how much each of your independent sales reps has sold. Use these figures to work out how much you owe each sales rep when you need to pay them.
Adrian Grahams began writing professionally in 1989 after training as a newspaper reporter. His work has been published online and in various newspapers, including "The Cornish Times" and "The Sunday Independent." Grahams specializes in technology and communications. He holds a Bachelor of Science, postgraduate diplomas in journalism and website design and is studying for an MBA.