What are Expense Categories?
FreshBooks makes it easy to keep track of your spending by organizing your business’ Expenses into Categories and Subcategories. These Categories and Subcategories follow Generally Accepted Accounting Principles (GAAP), which are commonly found on tax forms for claiming your business’ Expenses. You can also create Custom Subcategories for your business’ unique reporting needs.
Categories & Subcategories
FreshBooks’ default Expense Categories are equal to the default Accounts in the Chart of Accounts (available on Plus or Premium plans). Default Subcategories are included to provide even more granularity in your reporting.
- Categories are listed with an icon next to them, and Subcategories are listed underneath a Category
- Both Categories and Subcategories cannot be edited or deleted
- Subcategories are listed under their default Category on the Profit & Loss Report and appear when an Expense is categorized to that Subcategory
- If you have a bank account connected, you can have your Expenses automatically categorized for you - depending on which Bank Connection partner you're using (you can compare here), you can find steps for Plaid here or steps for Yodlee here
- Any Expenses that are not automatically categorized will be labelled Uncategorized until you can assign them a Category to remember for the future. Search for all Uncategorized Expenses by using the Advanced Search and selecting Uncategorized as the Category to search by
You can create a Custom Subcategory to organize and report on Expenses specific to your business’ unique needs. Custom Subcategories are similar to default Subcategories:
- Expenses can be assigned directly to a custom Subcategory
- Custom Subcategories are listed under their default Category on the Profit & Loss Report
- Expenses assigned to Custom Subcategories will be included within the default Expense Category/Account in the CoA
- Custom Subcategories can be edited or deleted
Create a Custom Subcategory
- While editing an Expense, click on the Choose a category and enter the Custom Subcategory
- Click on the + Create (Subcategory name) button
- In the Under dropdown, choose one of the default Categories to assign this Subcategory under
- Click Done to finish
- It will now appear on the drop-down list as an option. You can click Edit... next to it if you want to update it again after it's already been created.
Delete a Custom Subcategory
- While creating or editing an Expense’s Category, click on the Edit.. link next to it
- Then click on the Delete link.
Default Categories and Subcategories
Below is the list of default Categories and Subcategories:
|Expense Category||Expense Subcategory|
|Car & Truck Expenses||
|Education and Training||None|
|Meals & Entertainment||
|Office Expenses & Postage||
|Rent or Lease||
How do I change or update the Category on multiple Expenses?
You can reassign Expense Categories using these steps below:
- Use the Search, or check off the boxes next to the Expenses you want to edit
- Click on the Bulk Actions button
- Select Change Category
- In the dropdown, type to find the category, create a new Subcategory or choose from the list
- Click Save to finish. Your Expenses will now be reassigned to this new Category.