When to Use Bills and Expenses
Connie Wolf • February 2, 2026

When to Use Bills:

Use Bills in QuickBooks Online when you receive an invoice from a vendor but haven’t paid yet.


For example:

You receive a $2,000 invoice from your graphic designer, due in 15 days.

In QBO, you’ll record it as a Bill under + New → Bill.

Later, when you actually pay it, you’ll go to + New → Pay Bills.

This approach keeps your Accounts Payable (A/P) accurate and ensures you can track unpaid vendor balances and upcoming payments.


When to Use Expenses:

Use Expenses when you’ve already paid the vendor — immediately or on the same day.


For example:

You pay $100 at Office Depot for supplies using your business debit card.

In this case, you’ll record an Expense under + New → Expense.

QuickBooks will immediately reduce your bank balance and record the purchase.


Think of it this way:

  • Did I already pay for it? → Record an Expense
  • Do I still owe money? → Record a Bill

And when you pay the Bill later, don’t enter a new Expense — use Pay Bills in QuickBooks Online. If you still have questions, contact us!