Hey, it's Candace. In today's quick look, tips, and tricks, we're going to talk about gift certificates. We'll discuss how to set them up and what to do with them. The first step is going into your items list. When you sell a gift certificate, it is not considered income until you provide the product or service that the gift certificate represents. Therefore, when you sell a gift certificate, it becomes a liability for you. To create a new item for gift certificates, go to the bottom of the items list and select "New Item." Choose the item type as "Other Charge." In this example, let's name it "Gift Certificate" for simplicity. You can add a description if you want it to appear on the invoice. Leave the amount as zero unless you always sell gift certificates for a specific amount. Set the tax code as non-taxable since you don't know what the recipient will redeem it for, and the taxation happens at redemption. Now let's assign the account to the item. Use the "Other Current Liability" account, which you can name as "Gift Certificate" or "Gift Cards" or anything you prefer. This account will hold the money until the gift certificate is redeemed, so it's considered a liability. To track the sales of gift certificates, you can create a sales receipt. Choose how you want to track your customers - either by tracking every customer who purchased a gift certificate or by the name of the person who purchased it because someone else may redeem it. You can also select the payment type and date. In this example, let's assume a future date. Then select the item "Gift Certificates" that we just created. Enter the gift certificate number if applicable, any comments you want to add, and the amount...
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Sample Gift Certificate letter Form: What You Should Know
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