QuickBooks Tip: Setting Customer Credit Limits


It is helpful to your customers to extend credit to them, and doing so promotes trust and goodwill.  However, as a business owner you need to control your potential bad debt losses by setting credit limits for each customer.

Quickbooks can help you control your outstanding customer receivable balances by setting credit limits.  QuickBooks will warn you when you try to record a new invoice that would bring the customer’s outstanding balance above the credit limit.  Keep in mind that the warning does not prevent the invoice from being prepared, it only provides the warning.  To date QuickBooks does not give you the ability to put a credit hold on a customer, however I will offer some tips on that as well.

Set a customer credit limit by following these steps:

  1. Click Customer Center.
  2. Double –click the name of the customer for whom you want to set a credit limit.
  3. On the Payment Info tab, enter the credit limit in the field provided.
  4. Record the credit limit for this customer.

You should regularly run the accounts receivable (A/R) aging report to monitor your customers’ outstanding balances.

So what about a customer whom you want to place on a credit hold? Here are two easy ways to help prevent a posting of invoices or orders to that customer until he has paid off his outstanding balances:

  1. Make the customer inactive (in order to post anything to the customer you need to make him active).
  2. Modify the customer name to include CREDIT HOLD in the name.

Managing customer receivables is an important part of your business.  It’s important to keep on top of old outstanding receivables.  Communicating with your customers and discussing the issues is key to maintaining good customer relationships and healthy cash flow.

Lisa Kahn Little, CPA, is a Entrepreneurial Services Associate Principal at Kaufman Rossin, one of the Top 100 CPA and advisory firms in the U.S.

  1. Marla L O’Brien says:

    The Only place I have found the Credit Limit Option is on a List report. You can run a Customer list with phone #, then add the Credit limit selection by modifying the report. you can also add their balance and an overdue column

  2. Collette says:

    What version of Quickbooks are you using?

  3. Harry Paterson says:

    We have an issue with the credit limits being eliminated for some customers. We don’t know why this is happening.

  4. Lisa says:

    Unfortunately, there is just a list of customers that have a credit limit and the credit limit amount. If there is a credit limit the system there is a warning about posting a new invoice, however, the system will let you post it.

    • Leah says:

      I would also like to know how to find this credit limit report. I can’t seem to add that field to any reports. I am using Desktop Enterprise.

    • Bernadette says:

      Hi Lisa, Can you tell me where to find the list of customers with Credit Limit amounts? I’ve checked all my custom and QB reports and none allow me to add the Credit Limit field to a Display column.

    • Lisa says:

      What version of Quickbooks are you using?

    • Ellie says:

      I have QuickBooks Desktop. How do I pull this report? I need a list of customers that have a credit limit set up.

  5. Chelsea says:

    Is there a way to print a report that shows a list of customers that have exceeded their credit limit in their account?
    or just a list of customers that have a credit limit and the credit limit amount?

  6. keith Crosby says:

    We really need a way to set permissions so employees without permission can not change or delete a credit limit on a customer.

  7. Lisa Grossman says:

    I will pass this on to Inuit, but don’t know that they will be able to do this. I agree it would help if they could stop something from being processed.
    In the meantime you need to monitor it yourself.

  8. ian says:

    thank you! i wish Quickbooks will work on stopping an invoice from printing if CREDIT LIMIT is hit

  9. jo says:

    I put a credit limit on my charge accounts but if I go to make a sale and to charge to them it lets the charge go through …. is there a way to not let the customer go past his credit limit?

  10. Christine says:

    Is there an option to alert data entry at time of billing if the customer has past due invoices? say over 60 days or does this just require some due diligence? Also is there a way to set up a default so that all new accounts will have an automatic credit limit?

  11. Martha I Valverde says:

    Is there a way to mark the customer if the Sales Tax Certificate is updated every year? If so, where and how?
    My boss told me some softwares can keep track of this item.Thank you!

    • Lisa Grossman says:

      Quickbooks does not have a feature for this. You could set up a memorized transaction to remind you to check each year.
      Good luck

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