How Tips Sync to QuickBooks and How Refunds Work

Where tips land in QuickBooks Online and Desktop (Gratuity Sales Receipt, BG Tip Income or Tips Payable), keeping the item non-taxable, and how refunds and chargebacks reverse the tip.

Written by Thomas Aronica (Super Administrator)

Updated September 23rd, 2026

Tips collected through the Tips add-on are booked separately from your invoice revenue and reversed automatically when you refund or void. This article explains where the money lands in QuickBooks Online, QuickBooks Desktop or a Biller Genie only account, how to keep the tax treatment clean, and what happens on refunds, voids, chargebacks and returned bank payments.

The Gratuity item and the tip account

When you turn Enable Tipping on with QuickBooks connected, Biller Genie creates these records if they do not already exist:

Record	QuickBooks Online	QuickBooks Desktop	No accounting software
Item on the receipt	Gratuity, a Service item, non-taxable	Gratuity, an Other Charge item, tax code NON	Gratuity item on your Items page, created at your first tipped payment
Account when you keep tips	BG Tip Income (Income)	BG Tip Income (Income)	Not applicable
Account when tips are owed to staff	BG Tips Payable (Other Current Liability)	BG Tips Payable (Other Current Liability)	Not applicable
Can I use my own account?	Yes. Pick it under Use an Existing Account before the item reaches QuickBooks, or remap the Gratuity row on the Item Mapping tab.	Map the Gratuity row to an item of your own on the Item Mapping tab.	Not applicable
Can I change income to liability later?	Yes. Biller Genie repoints the item without rewriting past transactions.	No. The choice locks once the item is created.	Not applicable

Tip Income or Tips Payable?

Tip Income (recommended) when tips are your revenue. Your books clear themselves: each tip is income on the day it is collected.
Tips Payable (liability) when you pass tips on to staff. Every tip raises the Tips Payable balance, and the balance only falls when you pay staff through payroll outside Biller Genie. Clearing that balance is your job. Biller Genie never distributes tips.

How a tipped payment books

Invoices synced from QuickBooks

The invoice payment syncs as usual. The tip syncs as its own one-line Sales Receipt for the Gratuity item, posted to your tip account. It is never added as a line on the invoice. See Creating Sales Receipts for how Sales Receipts work in Biller Genie.
QuickBooks assigns the receipt number. Until the sync completes, Biller Genie shows an italic placeholder; afterwards you see Tip Receipt # and the number on the transaction, and a Tip Sales Receipt row on the transaction details.
The invoice details show "This invoice has associated tip sales receipt(s)" with a link to the receipt.
When several invoices are paid together, one Sales Receipt carries the whole tip and is linked to the first invoice in the payment.
If you deactivate the tip account in QuickBooks, Biller Genie reactivates it at the next sync so tips keep booking.

Invoices created in Biller Genie

Invoices you create directly in Biller Genie, with no accounting software behind them, get a Gratuity line added to the invoice for the tip, and the payment covers it, so the invoice still closes at zero.

Bank payments

A tip on a bank payment is charged with the payment but booked when the payment settles, usually a few days later. Until then the transaction shows "A tip receipt for $X.XX will be created once this bank payment settles." A bank payment that never settles books no tip.

Keep the Gratuity item non-taxable

Biller Genie never adds tax to a tip

Leave the Gratuity item non-taxable and the Tax Rate on the Tips page at 0. If you make the item taxable in QuickBooks, Biller Genie splits each tip so the receipt still totals what the customer paid: a $10.00 tip at 8% books as $9.26 tip plus $0.74 tax. On QuickBooks Desktop a later refund of a tipped payment can then leave invoice revenue off by a few cents. Non-taxable avoids both.

Refunds and voids

The tip follows the same path as a Technology Fee: it is reversed automatically and in proportion. There is no option to keep the tip when you refund, and no option to refund the tip alone.

You do this	What happens to the tip	In QuickBooks
Void a payment	The whole tip is reversed.	QuickBooks Online voids the Gratuity Sales Receipt. QuickBooks Desktop deletes it.
Refund the full amount	The whole remaining tip comes back.	One Refund Receipt (Online) or a Credit Memo and Check (Desktop) covering the invoice, the Technology Fee and the gratuity. The Sales Receipt itself stays.
Refund part of the amount	The tip is refunded in the same proportion as the payment. Several partial refunds add up to the whole tip.	The refund artifact includes the gratuity share.
Bulk refund or bulk void	Each invoice in the payment is reversed with its share; the tip sits with the first invoice.	As above, per invoice.

On the refund window the Gratuity portion row shows the tip share for the amount you entered. The checkbox "Treat the amount entered as the invoice amount, and add its Technology Fee and Gratuity share on top" only changes how your typed number is read; the tip is refunded either way.

Merchant Portal Transaction Details page showing Amount 345.00 and Tip 45.00 on separate rows, with Refund and Void buttons

Transaction Details lists the tip on its own row. Refund and Void start from this page.

Chargebacks and returned bank payments

A chargeback reverses the full charged amount, tip included, as a journal entry. You enter no figure.
If you lose the chargeback and rebill, the new invoice is for the original invoice amount only, without the tip or the Technology Fee.
A bank payment returned after settlement is treated the same way: the reopened invoice asks the customer for what the invoice was owed, not the tip. The Gratuity Sales Receipt stays in your books.

Reports and exports

The All Transactions export includes Tip and Tip Receipt # columns. The on-screen grid shows the tip receipt number in the Invoice / Sales Receipt column but has no separate Tip column.
Transaction details show a Tip row and a Tip Sales Receipt link.
Tips are part of the card or bank payment, so they count in your processed volume and in the gross amount on the 1099-K your processor issues, whichever account you post them to.

Xero

Tips is not offered to Xero merchants. If you installed Tips before connecting Xero, you can keep collecting tips; they are recorded on your invoices in Biller Genie but do not sync to Xero, so you record them in Xero yourself. See Using Xero in Biller Genie.