A smart entrepreneur is known for their creative ability to generate money in a variety of ways. Rather than relying on a single service and a small number of clients, diversifying your sources of income can help you achieve long-term success. But when a business is earning money from activities that are not directly related to the primary operation, then this money is considered as Other Income and not revenue.
Other Income can include, but is not limited to, selling goods online, bazaar booths, space rentals or even advertisement. But with extra money comes the extra effort of tracking what’s going in and out of your accounts. It is essential to keep your Other Income recorded, which can be simply done on FreshBooks.
How to Add Other Income Payments on FreshBooks?
Start by logging into your FreshBooks account on your desktop or mobile web browser.
1. On your Dashboard, head to ‘Create New’ and click on ‘Other Income’
A new draft will drop down to fill in the details of the payment.
2. Fill in the Source
Choose an existing source from the drop-down history list or create a new one by writing the name of the company or individual.
3. Choose an Income Type
Other Income can be categorized into the following:
- Advertising & Affiliate Income
- In-Person Sales
- Online Sales
- Rental Income
That way, your Other Income section will not be too general and categorized accordingly when extracting reports .
4. Fill in the Amount of Payment
Choose the currency of payment and add the total amount you received.
5. Add Date of Payment
From the drop-down calendar, choose the day date in which payment was received.
6. Add Included Taxes (optional)
If the payment included any kind of tax, click on the ‘Add Included Taxes’ to fill in the name and amount accordingly.
7. Choose Payment Method
Whether it’s a bank transfer, cash, or visa, you can choose out of 15 payment methods.
8. Put a Description
This is optional. You can add the swift code, name of bank, or any necessary info regarding the payment.
9. Save your Other Income Payment
Click on Save and the payment will be automatically added.
How to View and Edit Other Income?
- Head to Payments (5th icon on the left sidebar – wallet icon)
- Three payment tabs are available, click on the last tab “Other Income”
- You will find a list of all Other Incomes along with their details (source, category, date, description and total amount)
- Click on Filter if you want to view payments in a specific period of time or under a certain category
- Click on one to edit any information
- Assign a Client if applicable
To learn more about Clients, check out How to Add a Client and How to Manage Clients on FreshBooks.
Another method to create a new payment is by clicking on the ‘+’ green sign and following the same steps.
You can also head to the bottom and click on ‘archived Other Income’ or ‘deleted’ to view your history.
Why is Other Income Important?
Every penny you earn is considered income, but you can’t always pile them up with your business revenue. As we mentioned earlier, revenue is the result of selling your core business product or service, which is the main intent of your business. Nevertheless, that should not be your only focus. Even though Other Incomes are not directly related to your operation, they are beneficial sources of income that should not be overlooked.
Regardless of where your money comes from, you need to keep track of non-invoiced and side payments to have a better idea of your cashflow. Having a system in place to manage your finances is essential as one’s perception of how much they’re making may be different than the actual numbers in the books.
The sky is the limit when it comes to running a successful small business. So whether you’re hustling a side gig or pursuing multiple sources of income, FreshBooks will help you account for it all.
Learn other features on FreshBooks and stay on top of your finances:
How to Create an Invoice on FreshBooks?
What’s a Checkout Link on FreshBooks?
How to Add an Expense on FreshBooks?
How to Invoice an Expense to a Client on FreshBooks?
What’s a Retainer on FreshBooks?
How to Create a Proposal on FreshBooks?
What’s the Difference between Estimate and Proposal on FreshBooks?