Billing

Billing

This page describes the main Billing tab in the system. If you are looking for information about how to set up the system see Admin > Billing.

The integrated billing system is simple to set up, yet is designed to be very flexible and powerful. It can take care of all your invoicing and card payments (with little or no work from you). It chases up customers for non-payment automatically, and gives everyone their own Bills & payments tab, where they can instantly see exactly what they owe or the amount still left to spend in their account. It integrates with Xero, QuickBooks and Sage.

Why use our billing system instead of monthly invoices?
  • Fully automated invoicing and payments, no more messing about with paper invoices or working out how much to charge.
  • Much improved cashflow. No more waiting for cash your business could be using.
  • Customers love seeing their invoice immediately (perhaps this is unexpected!).
  • Monthly bills can be large amounts; this might make them reconsider making their next booking.
  • Save time by automating your bookkeeping.

 

The Billing tab shows the balance for each customer with a transaction in their account. The balance is split to show the amount overdue separately from their total balance.

You can use this page to get a quick view on the amounts outstanding. The page shows the highest debt at the top, though zero and on to any pre-paid accounts at the bottom as shown in the example:

Billing tab showing balances for some students

The rows are highlighted as follows:

  • Red: Customers with overdue balances
  • Amber: Customers with a debt amount, and no stored card details
  • Green: Customers with a debt and stored card details

 

To view a customer's account in detail, click their name in the first column. From the customer's account page you can do things like add invoices, credits, make payments (if the customer is sitting with you) or just record their card details for future payments.

Mathew Waters

Customer accounts

Customer accounts

This page describes the customer's Bills & payments tab from the point of view of the school (eg owner, office staff or an instructor). If you are a customer, please see Bills & payments in the user guide.

If you have turned on the billing system, all your customers will see their own Bills & payments tab in their account when they log in.

Additional options are available when viewing the customer's Bills & payments tab as office staff. For example, you can manually create an invoice, credit note, or record payments received outside Stripe using an adjustment. To find out more, see Manual entries.

You can also set the customer's price group (which can also be done from their Settings tab). This defines prices they will pay for aircraft hire, training and regular fees such as membership.

Viewing a customer's Bills & payments tab as office staff

When you set a price group for a new customer, any membership fees are prorated to cover the remaining period until the next membership fee is due.

When you are new to the system and your customers have already been invoiced for membership fees, the situation is more complicated. To find out how to migrate customers, see Existing customers.

Mathew Waters

Existing customers

Existing customers

If you are moving to Flight School Booking from another system and have customers who have already paid membership fees, setting up their billing account involves a few more steps than for new customers.

We'll assume you have already defined a price group for students and have created a student user in the system. If you have not set up a price group for students yet, see Admin > Billing > Price groups.

All new users are created on the DEFAULT price group, so the student will not have any membership fees so far.

Migrating customers: choose their price group

Click Change price group to choose which price group this customer will be using.

When choosing a price group you can set the date at which the prices are effective. Typically you would leave this set to "Today".

What are the other options for?
  • Today
    Strictly speaking this is also a backdated change, and any invoices for flights taken today are credited and re-invoiced at the new rate.
  • A date in the future
    If the customer can be safely left on your standard prices until the future date you can choose it here. This is suitable for a defined "go live" date that coincides with when membership fees are normally collected, or when you agree with a customer they will become a member on a specific date in the future and start paying fees from then.
  • A date in the past (backdated change)
    Normally not used. If a customer has been on the wrong price group for a number of days, you can back-date the change and the system will credit any flights, training sessions and so on before re-invoicing at the rates defined by the price group you choose.

 

The system offers an option to set the customer's opening balance within the first six months of using the billing system. This automates the process of onboarding existing customers who may have an outstanding or pre-paid balance with you.

When a price group includes membership fees, an invoice is created to cover the remainder of the period until the next due date. (Due dates are defined in the price group under Admin > Billing > Price groups).

Migrating existing customers is easy because you can set their balance when setting their price group.

Opening balance

The system offers a simple way to migrate the customer's balance. This option is only available when first setting the customer's price group and only for a few months after the billing system is turned on.

When setting up an existing customer, you will need to know their up to date balance. Therefore you should make sure you have already accounted for this in your existing system, whether it be a simple spreadsheet or a full bookkeeping package. If the customer has recently made payment, check this has already been accounted for to ensure you have an accurate balance.

In this example, the customer has pre-paid for a block of flying lessons. For people with an agreed number of hours, work out the balance as:

    balance = (flying rate on the price group) x (number of hours remaining)

When the price group is assigned, the system invoices the customer (silently) and applies a credit for the same amount. The invoice allows the system to keep track of the period the customer has paid membership fees for, and the credit reverses this transaction financially. The opening balance hides these previous entries from your customer's bills & payments tab.

Migrating existing customers is easy because you can set their balance when setting their price group.

 

 

Mathew Waters

Manual entries

Manual entries

There are a few different types of transaction you might want to add manually to a customer's account. Most are only available to office staff and the school owner, but instructors can add and edit draft invoices.

To add a transaction to a customer's account manually, first find their Bills & payments tab. Then click one of the manual entry buttons Invoice, Credit or Adjustment.

Action buttons in Bills & payments

It is important to understand the differences between invoice, credit and adjustments to prevent problems later on when bookkeeping. Invoices and credits both affect your profit and tax, so only use them when you are selling or returning something. When a customer pays using Stripe the system will take care of the payment for you. But if you accept payments outside Stripe you can add an "adjustment". This transaction affects the customer's balance and your assets. To set up alternative payment methods such as cash or bank transfers, see Admin > Billing > Account codes.

Invoice

The system will create invoices itself for flights, training (including ground school) and for regular payments such as membership fees.

You or an instructor might want to add an invoice manually if a customer wants to purchase something else from you, such as a knee board, pilot's logbook, charts or a headset. If the products have not been set up already, see Admin > Billing > Shop.

To sell a shop product to an existing customer, follow these steps.

  • Find the customer using the People tab.
  • Click the Bills & payments tab.
  • Click the Invoice button and start typing the name of the product.
    If you are selling something that has not been set up as a product, type the word CUSTOM (in capitals). This allows you to create any invoice you like, note you will need to set the correct tax and account codes. Where possible, create an entry in the Shop to reduce coding errors.

 

The quantity is accurate to five decimal places, which is useful when selling things like time (in hours) or fuel (in litres or gallons).

When you have finished, you can either save the invoice as a draft, or finalise it for payment. If you are working on an invoice over a period of time you may find it worth saving a draft invoice, which you can add to later. Otherwise, check the amount(s) and you can add the invoice to the customer's account for payment. You can still make changes or delete the invoice for a certain time. The rules for these are:

Condition Can delete? Can edit? Can void? Can reverse?
Customer is unaware of the transaction YES YES   YES
Invoice link has been emailed     YES YES
Customer has viewed the transaction       YES
Transaction has been exported (CSV, Xero, QuickBooks etc)       YES

Credit

Credits are the reverse of invoices; you can think of them as invoices with a negative amount to pay. Just like invoices, credits affect your profit and tax liability.

There are two methods of creating a credit on someone's account. When the credit relates to an invoice you should credit from the invoice itself. This is most likely a dispute or a correction of an invoice amount. But you might also use a manual credit when a customer makes a pre-payment for a package.

Disputes or corrections

To credit back a specific invoice, find the invoice itself first, and use the Reverse button. It is better to credit this way because

  • The reversal form highlights any previous credits for the same invoice, ensuring you do not over credit.
  • The correct tax and account codes are copied from the original invoice.
  • You - or someone - else can easily tell what the credit was for, and can follow a link back to the original invoice.

Pre-payment discounts

If you offer training packages at discounted rates such as a 15 hour pilot course, you should add a credit as described in Courses / Training packages. Adding a credit like this reduces your tax liability in the short term.

 

Adjustment

An adjustment represents a cash or card transaction that did not go via the billing system. For example, if the customer made a payment to you using cash, your own card machine, or a cheque, they will want to see the payment recorded in their account. To do this, add an adjustment.

Adjustments are also used if you are refunding the customer from outside the system. For example, if you give the customer cash, cheque or transfer money to their bank account or card. In this case, create a record of that transaction as an adjustment.

To record these kinds of transactions you will need to have already set up the different payment options as accounts under Admin > Billing > Account codes.

Opening balance adjustment

An opening balance is a special type of adjustment. In normal circumstances, you will not need to add opening balances yourself. The system handles adding an opening balance record the first time you change your customer's price group. But if your customer pays your standard prices you may leave them on the DEFAULT price group and set their opening balance as needed.

When setting an opening balance, any adjustment necessary is made to arrive at the balance you specify. In addition, older transactions are archived and are not visible to the customer viewing their own transaction history.

By adding an opening balance, even if zero, you are confirming to the customer the amount in their account as you move them from an older system to this one. This is important because customers will want to know where they stand and will rely on the list of transactions to tell them how much they owe, how much to budget or when they need to make another payment.

 

Draft vs Finalised invoices

When you create an invoice or credit manually, you will see they are created as drafts. These do not appear on the customer's account and you can continue to make changes or delete them. Once you "finalise" the transaction, it is moved into the customer's account and they can see it. Once finalised, you can no longer edit it but you can of course reverse any invoice with a credit and likewise any credit with an invoice.

Invoices created by the system are finalised straight away. This means when adding a flight, you can view the invoice immediately and take payment.

Mathew Waters

Cash payments

Cash payments

Some customers might want to pay by cash or bank transfer to your account. The system handles this too, but unlike Stripe payments, it requires some time from you to add the amounts received into their account.

In this example, Sarah Smith is a customer with an invoice to pay.

Outstanding balance shown in customer account

The customer has paid the full amount as cash, so we need to record the amount received in their account. Click Adjustment.

 

Choose the appropriate options on the adjustment form. Check the amount at the end, unlike invoices and credits there is no draft for adjustments, they update the customer's account immediately.

Record a cash amount received

If you do not have the appropriate account shown under Accounts code, set this up first under Admin > Billing > Account codes.

Mathew Waters

Courses / Training packages

Courses / Training packages

A lot of flying schools offer students the option to purchase reduced training rates for an up-front payment. For example, as a school you might offer a 5% discount on student training rates when a block of 10 hours is purchased.

From a tax perspective the "purchase" of a package is a pre-payment and is not liable for VAT at that point. Cash flow is improved because you will only be liable to pay VAT once the flight has been invoiced.

The following describes how best to set up the system when a customer buys a package. As an example, the standard hourly training rate for students is £180. When a student purchases a block of 10 hours, instead of the normal charge of £1,800 we charge £1,710 (a 5% discount).

To take payment, do not create an invoice! Instead, the customer makes a payment of £1,710 using the Make payment button in their Bills & payments tab. If you prefer to take payment direct into the bank, record this from their Bills & payments tab by adding an adjustment once the payment has reached the bank.

Next add a credit to their account from their Bills & payments tab. In this example the student will be invoiced a total of £1,800 once the 10 hours have been flown, so the difference of £90 (1800 - 1710) should be added as a credit. The credit should be made with matching VAT and accounts codes as the training rate set up under Price groups.

If you have a fixed discount (eg 5% when buying a block), you can use the formula below to work out the credit amount to add:

C = d * P / (1 - d)

Where …

  • C is the credit amount
  • d is the percentage expressed as a fraction, eg 5% would be 5/100 or 0.05.
  • P is the amount received from the customer.

 

Tip: Avoid mistakes by checking the credit amount feels about right. It should be a small fraction of the total payment!

After adding the credit, the student's balance will be higher and they can fly on the standard student prices.

Mathew Waters

Refunds

Refunds

The process for refunding is two steps.

First, you should issue a credit note that itemises and describes what you are refunding for. The credit also contains the tax amounts, and if you are registered for VAT you can claim back this amount from your tax authority. You can add credits manually, but the most common method is to find the invoice first.

Each invoice can be credited back using the Credit button

To credit some or all of an invoice back to a customer, click the Reverse button shown above the invoice. This creates a credit with all the same tax and accounts codes.

Next, you can try to refund back to the customer's card if they have used the billing system to make payments. Look for transactions of the type Receipt. If not, or if the last payment is over 90 days old, you will need to send them the money yourself and add an adjustment to their account manually (see Manual entries).

Assuming there is a recent receipt listed, click on it to view the details.

Refund button is shown above a receipt

Click the Refund button. You can refund all or part of a payment, the system will keep track of when a payment is fully refunded.

Refunds you send direct from your Stripe account (eg the Stripe app or web page) are also reflected in the customer's account.

Mathew Waters

Bookkeeping

Bookkeeping

Flight School Booking's billing system integrates with the most popular bookkeeping packages. Configure the link at Admin > Billing > Bookkeeping.

The link to Xero, QuickBooks or Sage takes a lot of the work out of bookkeeping because the system keeps track of which transactions have been reported and which have not.

If you use another package, you can use the "Accounting summary report" under Billing > Reports, which provides the same information in a form you or your accountant can manually enter.

Mathew Waters

Reports

Reports

There are a number of financial reports available from Billing > Reports. These are visible to users with the Accountant or Owner roles.

  • Accounting summary
  • Sales and adjustments by accounts code
  • Sales by tax code
  • Sales by customer
  • Sales by aircraft (hire only)
  • Sales by instructor (training or ground school)
  • Sales by product
  • Payments processed (Stripe)

 

Report options

All reports can be run over a date range as shown:

Accounting summary report

Links

Look out for links in the reports. These allow you to drill down and investigate which transactions are included in a figure.

Accounting summary

The report shows a "manual journal" which can be entered into bookkeeping software to represent the sales and payments in the period. If you are using an integration with one of the supported bookkeeping packages this information is being sent automatically overnight. But if you use another less popular package for your accounts you can still enter the summary transaction instead of copying every invoice, credit and transfer. To find out how to enter the summary transaction using the information in this report, see Manual data entry.

Some bookkeeping software takes charge of the tax amounts and therefore introduces small rounding errors because Flight School Booking calculates tax at line level. To ensure the books are correct and agree with Flight School Booking, there is an option to Add adjustments for tax at line level. If your bookkeeping software allows you to specify the tax amount you can leave this turned off, otherwise turn the option on. This tells Flight School Booking to calculate the tax amount based on the total net sales per account and tax code. Where there is a difference between this and the totals from line level, the app will modify the figures slightly, adding additional lines at no tax to force the bookkeeping package into agreement.

Sales and adjustments by accounts code

This report shows a breakdown of net sales by accounts code. Net sales are the total income generated (after credits and tax taken off) in each account code.

The report also shows any transfers to other account codes such as opening balances, cash and direct to bank payments.

Sales by tax code

Shows the net sales broken down by tax code.

Sales by customer

This report shows the net sales broken down by customer with the highest income first in the list. This can be useful to show your best customers in the period.

Sales by aircraft (hire only)

When the system generates invoices for flying, it tags each with which aircraft was used. This report breaks down the net sales by aircraft, not including any flight training, circuit or landing fees. If your student prices for aircraft hire include the training element, this report is not going to be very useful. But if you separate out the aircraft hire and training rates the report will give a meaningful breakdown of sales value by aircraft.

Sales by instructor (training or ground school)

Invoices for flights with an instructor or ground school include information about who was instructing. This report breaks down net sales by instructor. Note another report under Training > Reports which shows a breakdown of number of training sessions, and total hours by instructor and accounts code.

Sales by product

This report shows a breakdown of net sales by price group or product.

Payments processed (Stripe)

This is a simple list showing payments processed by Stripe:

  • Payments
    Total card payments made by your customers using Stripe, displayed as a positive amount.
     
  • Refunds
    Refunds you have made using Stripe, or disputed transactions settled in the customer's favour are shown as a negative amount.
     
  • Stripe fees
    Stripe fees vary by country and by the cardholder's country. For each card payment, Flight School Booking records the fee amount. This is shown as a negative amount.
     
  • Platform fees
    If you are using the Gold Plan there are no platform fees. These are fees charged by Flight School Booking on card payments for online voucher sales while on the Silver Plan. Just like the Stripe fees, these are displayed as a negative amount.
     
  • Net to bank
    The total of all the above figures is the net to bank amount. This is the amount you will receive from Stripe for the period of the report. Since Stripe make payments according to the schedule you have set up with them, the amount is a guide for the period and not the actual deposit amount on a particular date.

 

Mathew Waters