Record income and expenses

Recording income and expenses is how the money that moved gets into your books. Every sale and every cost lands on your Profit & Loss, and a transaction nobody recorded is a transaction your reports can't see.

There are two routes to each — from a bank transaction already in stub, or typed in by hand — and both take under a minute.

Income, expense or asset?

1. Income is a sale you've earned. It's the top of your Profit & Loss.
2. Expense is a cost used up in the same financial year — rent, stock, software, internet. It reduces profit in the period it belongs to. Some costs, like insurance paid up front, are spread over the months they cover.
3. Asset is a big purchase that lasts for years — a laptop, a vehicle, a salon chair. Record it under Assets and write it down gradually instead.

Get the last one wrong and both your reports lie: record a R25,000 laptop as an expense and your Profit & Loss shows a dip that never happened, while your Balance Sheet misses something the business owns. See Record a business asset.

Why stub counts income when you invoice it

stub keeps your books on the accrual basis: income counts when you earn it, costs count when you incur them, whichever day the cash moves. Invoice a customer R10,000 in May and get paid in June, and the sale sits in May, where you earned it.

That's what makes your Profit & Loss a true read on the month's trading — and it's why it won't match your bank balance. Cash Flow is the report for money that actually moved. See Cash Flow report.

Record income from a bank transaction

Use this when the money is already in your feed.

1. Click Sales in the sidebar.
2. Click Choose a transaction — your bank transactions are listed by month.
3. Select the transaction.
4. In the Income form, set the Type — Invoice payment if it settles a specific invoice, or Sales, Interest Earned, Tips & Donations or Asset sale.
5. Enter a Description your future self will understand.
6. Check the Amount and Date — both come off the transaction.
7. Click + VAT and pick the rate if you're registered.
8. Leave Paid to as it is: the bank account is already selected.
9. Add a Tag, a Note or a File if it helps.
10. Click Save.

What happens in your books: sales go up, the bank goes up, and if you linked it to an invoice, that invoice is settled — so the income isn't counted twice.

Record income by hand

Use this for cash takings, an online payment settlement, or anything not in your feed yet.

1. Click Sales in the sidebar, then Create → Income.
2. Set the Type — Sales for goods or services, or whichever fits.
3. Enter a Description and the Amount.
4. Click + VAT and pick the rate if you're registered.
5. Set the Date you earned the income.
6. Under Paid to, choose the account the money went into — a bank account, or the till, petty cash or wallet account it landed in. See Set up your cash accounts.
7. Add a Tag, Note or File if it helps.
8. Click Save.

Note: Income recorded to Cash or Online Payments still has to be matched or transferred when the money settles in the bank, or you'll count it twice.

Record an expense from a bank transaction

Use this when the payment already shows in your bank feed.

1. Click Expenses in the sidebar.
2. Click Expense → Choose a transaction — your transactions for the month are listed.
3. Select the transaction. The Expense form opens.
4. Pick the Category — Inventory for items you sell, or Software & Subscriptions, Fuel, Rent, Bank Charges, Contract Workers, and so on.
5. Enter a Description — "Shoprite stock", "Zoom monthly subscription".
6. Pick the Supplier, or click + Supplier to add one with their address, VAT number and registration number.
7. Click + VAT and pick the rate if you're registered.
8. Check the Date and Paid from — both come off the transaction.
9. Add Notes, Tags or a File such as the receipt.
10. Click Save.

stub matches the expense to the bank transaction for you.

Record an expense by hand

Use this when you paid cash, the payment hasn't reached your feed yet, or you want to log a bill you still owe.

1. Click Expenses in the sidebar, then Expense → Add expense.
2. Pick the Category — an expense type like Advertising & Marketing, Cleaning, Fuel, Insurance or Equipment Rental, or Asset purchase for something you'll keep.
3. Enter a Description — "MTN airtime top-up", "New display shelves".
4. Pick the Supplier, or add a new one.
5. Enter the Amount — what actually left the account, VAT included.
6. Click + VAT and pick the rate.
7. Set the Date on the supplier's invoice or the payment.
8. Under Paid from, choose the account the money came out of — a bank account, or a cash account like a till or a petty cash tin.
9. Add Notes, Tags or a File.
10. Click Save.

Haven't paid it yet? Leave Paid from empty and stub carries it as money you owe until you settle it. If it's a supplier invoice with terms, record it as a bill instead — see Record & track supplier bills.

How VAT works here

The Amount on an income or expense is the total that moved, VAT and all — so stub works the tax out of it rather than adding it on top. At 15%, R5,389 is R4,686.09 plus R702.91 of VAT. On an invoice line or a saved product you get to choose; here you don't, because the amount is the bank's figure, not stub's. See Add VAT to income and expenses.

What happens in your books

1. Income increases sales on your Profit & Loss; expenses reduce your profit.
2. The bank or cash account moves by the amount.
3. An unpaid expense sits as money you owe until you mark it paid.

Worked examples: shampoo stock for R1,200 at Pick n Pay goes under Inventory; a R300 monthly software subscription goes under Software & Subscriptions; a R25,000 salon chair is an Asset purchase, which stub then depreciates over time.

Five habits worth keeping

1. Attach the receipt. SARS requires a supplier invoice for any expense over R5,000. A photo or a PDF is fine.
2. Categorise consistently. The same cost under three different categories makes your Profit & Loss and VAT reports useless.
3. Keep suppliers tidy. VAT and registration numbers on the supplier record save you time at every return.
4. Check weekly. Ten minutes catches duplicates and missing receipts while you still remember them.
5. Keep personal spending out. Log it as drawings, not an expense — drawings reduce equity, not profit. See Handle personal spending on a business account.