How do I record income if I’m paid partly in cash and partly online?

Understanding why mixed payment records matter

If you’re paid partly in cash and partly online, you’re not alone. Many freelancers, contractors, tradespeople, hospitality workers, creators, tutors, and small business owners receive a blend of payment types: some customers hand over notes and coins, while others pay by bank transfer, card, PayPal, Stripe, mobile wallet, or an invoice platform. The mix can feel messy, especially when you’re trying to keep clean books, avoid missing income, and stay prepared for tax time.

The good news is that recording mixed payments is straightforward once you adopt a consistent system. The core principle is simple: every payment you receive for your work is income, regardless of whether it arrives in your hand or lands in your bank account. The payment method changes the paperwork and the way you track it, but it doesn’t change the underlying fact that you were paid. Your job is to create an audit-friendly trail that shows (1) who paid you, (2) what they paid for, (3) when you earned it, (4) how you were paid, and (5) what amount was paid in each method.

This article walks you through practical, real-world methods to record income when you’re paid partly in cash and partly online. You’ll learn how to structure your records, how to avoid double-counting or undercounting, and how to keep your system simple enough that you’ll actually maintain it.

Start with a clear definition of “income” for your records

Before you pick a tool or a spreadsheet format, decide what “income” means in your bookkeeping. For most individuals and small businesses, income is the money you receive (or are entitled to receive) in exchange for goods or services. In practice, you’ll generally record income when one of these things happens:

1) You receive payment (cash in hand, transfer received, card payment settled), or

2) You issue an invoice and treat income as earned when the invoice is created (common for accrual-style records).

Many small operators record income on a cash basis because it’s simpler: you record income when you actually receive it. That approach makes it easier to track mixed payments because you can match each payment to a date and a method. If you use invoicing and want more detailed tracking, you can record income when invoiced and record the payments as “settling” the invoice later. Either way works. What matters is being consistent and keeping enough detail to explain the numbers later.

If you’re unsure which method you’re using, a practical default is: record income when you receive payment, and use invoices/receipts as supporting documents. That keeps your records aligned with the money movement you can see.

Think in “transactions,” not “payment methods”

The most common mistake with mixed payments is recording the same job twice: once when you log the cash, and again when you see the online transfer. Another common mistake is recording only the online part because it’s easy to verify, and forgetting the cash portion because it didn’t automatically appear in your banking app.

A reliable way to avoid both errors is to treat each sale/job/client agreement as a single transaction that may have multiple payments. In other words:

One sale → can be paid by one or more payments → each payment has a method (cash, bank transfer, card, wallet, platform) and a date.

This mindset helps you keep your story straight. If you did a £300 job and the client gave you £100 cash and £200 by bank transfer, you have one sale worth £300 and two payments: £100 cash and £200 online. Your records should make that obvious.

Choose a recording method that matches your workflow

You can record mixed payments using many tools: accounting software, invoicing platforms, point-of-sale apps, spreadsheets, notebooks, or even a combination. The best system is the one you’ll use consistently. Here are three practical options, from simplest to most structured:

Option 1: A simple spreadsheet with a “split payment” structure

A spreadsheet is often the easiest starting point. You can make it as basic or as sophisticated as you like. The key is to design it to handle split payments without confusion. There are two popular layouts:

Layout A: One row per sale, with separate columns for cash and online

This layout works well if your sales are straightforward and each sale is paid on one day (or nearly so).

Suggested columns:

Date of sale | Client/customer | Description | Total amount | Cash received | Online received | Payment platform (if online) | Receipt/invoice number | Notes

Example:

2026-01-10 | Alex R. | Website edit | 300 | 100 | 200 | Bank transfer | INV-1042 | Cash on site, transfer later same day

With this layout, your totals become easy: your income for the sale is the “Total amount” column, and your cash vs online breakdown comes from the separate columns. If you get paid across multiple days, you can still use this method, but you’ll need a good notes field and maybe additional columns for payment dates. If you frequently receive instalments across different dates, consider Layout B instead.

Layout B: One row per payment, linked to the sale/invoice

This layout is ideal if you often get deposits, partial payments, or payments on different days. It’s more detailed but more accurate for messy real-life scenarios.

Suggested columns:

Payment date | Client/customer | Sale/invoice number | Description | Amount received | Payment method | Platform/reference | Bank deposit date (if cash deposited) | Notes

Example entries for a single sale:

2026-01-10 | Alex R. | INV-1042 | Website edit (part payment) | 100 | Cash | N/A | 2026-01-12 | Received on site

2026-01-10 | Alex R. | INV-1042 | Website edit (balance) | 200 | Bank transfer | Ref: AR1042 | N/A | Received via online banking

When you use one row per payment, your “income received” is simply the sum of the “Amount received” column for the period. To avoid losing track of what’s still owed, you can keep a separate invoice list or use a pivot table to compare invoice totals vs payments received.

Option 2: Invoicing with partial payments (recommended for client work)

If you do client work—freelancing, consulting, trades, tutoring, design—issuing an invoice can make split payments much easier to document. Even if you’re paid on the spot in cash for part of the amount, an invoice can show the full amount due and the payment history.

A practical workflow looks like this:

1) Create an invoice for the full amount.

2) Record the cash payment as a partial payment against that invoice (date, amount, method: cash).

3) Record the online payment as the remaining payment (date, amount, method: bank transfer/card/payment platform).

4) Mark the invoice as paid when the total payments equal the invoice total.

This creates a clean trail: the invoice represents the sale, and the partial payments show how it was settled. It also reduces the temptation to treat cash and online as separate income events.

If you don’t want to use full accounting software, many invoicing tools allow partial payments. The key is that your invoice numbering stays consistent and your payment entries clearly identify the method and date.

Option 3: Accounting software with split tender or multiple payment entries

If you’re using accounting software, it often supports multiple payments per invoice or “split tender” at the point of sale. This can be very efficient because the software automatically categorizes and totals the payments by method, helping with reconciliation. The principles are the same:

Record one sale, then apply the cash portion and online portion as separate payments. Make sure the software’s “cash account” matches how you handle physical cash, and make sure your bank feed entries map correctly to the online payments.

The biggest benefit of accounting software is reconciliation: you can match online payments to bank transactions, and you can create a process to reconcile cash by tracking cash received and cash deposited.

Create a receipt or invoice trail for every split payment

When you’re paid in mixed methods, documentation becomes even more important because the cash portion won’t automatically appear in your bank statement. A simple rule helps:

Every time money changes hands, create or keep a record.

That record can be an invoice, a receipt, a paid invoice note, an order confirmation, a payment confirmation email, a message thread, or a signed job sheet. The best record is one that includes:

• Date

• Customer/client name

• What the payment is for

• Amount

• Payment method (cash vs online)

• Any reference number (invoice number, transaction ID, bank reference)

For cash payments, it’s especially helpful to issue a receipt or mark the invoice as “cash received” with the date and amount. For online payments, save the confirmation email, screenshot the transfer reference, or keep the platform’s transaction ID. You don’t need to overcomplicate it; you just need enough to explain the numbers later.

How to record split payments step by step (with examples)

Let’s go through a few common scenarios and how to record them cleanly.

Scenario 1: Paid partly in cash, partly by bank transfer on the same day

You complete a £500 job. The customer gives you £200 in cash and transfers £300 to your bank account.

Record one sale for £500 (invoice or sale record). Then record two payments:

• £200 cash received on the job date

• £300 bank transfer received on the job date (or the date it arrived in your account)

If you use a spreadsheet with one row per sale, you can put £200 in “Cash received” and £300 in “Online received.” If you use one row per payment, you make two entries linked to the same invoice number.

Scenario 2: Cash deposit now, online balance later

You charge £1,000 for a project. The client pays £300 cash as a deposit and later pays £700 via an online payment platform.

Use an invoice for £1,000. Then record:

• Payment 1: £300 cash deposit (date received)

• Payment 2: £700 online payment (date received, platform details)

The key is to not treat the online payment as a new sale. It’s a settlement of the same invoice.

Scenario 3: Online payment now, cash tip later

A customer pays £60 online for a service and later hands you £10 cash as a tip.

Whether you record tips separately depends on your situation, but the record-keeping principle is consistent: log the £60 online payment as income, and log the £10 cash tip as income as well, clearly labeled as a tip or gratuity. If you issue a receipt, you can list the service charge and the tip separately so your records stay clear.

Scenario 4: Cash received, then deposited into the bank

You receive £400 in cash during the week. On Friday, you deposit £350 into the bank and keep £50 as petty cash for supplies.

This is where people often double-count. The deposit is not new income—it’s just moving money from “cash on hand” to “bank.” Your income was recorded when you received the £400 from customers.

To keep your records straight, separate these concepts:

• Income: £400 cash received from customers (recorded as revenue)

• Transfer: £350 cash deposited into bank (recorded as a transfer between cash and bank)

• Cash spending: £50 used for supplies (recorded as an expense paid from cash)

If you only track bank statements and ignore the cash ledger, you might accidentally record the deposit as income again. Avoid that by maintaining a basic “cash received” log.

Set up a simple “cash control” routine

When you accept cash, you become your own mini bank. A routine helps you avoid missing entries and makes your records believable and tidy. You don’t need a complex process—just a repeatable one.

1) Use a cash envelope, cash box, or dedicated wallet

Keep business cash separate from personal cash as much as you can. A dedicated container—an envelope, a cash box, or a separate wallet pocket—creates a physical boundary that supports accurate tracking. When cash is mixed with personal spending money, it’s easy to lose track and “mysteriously” come up short when you try to reconcile.

2) Log cash immediately (or at the end of each day)

Cash is most reliable when recorded at the moment you receive it. If that’s unrealistic, set a strict rule: log all cash received at the end of each day. Write down the amount, who it was from, and what it was for. Even a quick note you later transfer into your main system is better than relying on memory.

3) Keep a running cash balance

A cash balance is simply:

Opening cash + cash received - cash spent - cash deposited = closing cash

When you keep this balance, you can periodically count your cash and compare. If the numbers don’t match, you investigate while the trail is still fresh.

4) Deposit cash regularly

Regular deposits reduce the amount of cash floating around and make reconciliation easier. The goal isn’t to eliminate cash—just to keep it manageable and trackable. Depositing cash also creates an additional paper trail (deposit slips, bank entries), which can support your records.

Record online payments with enough detail to match bank entries

Online payments feel easier because you can point to a bank statement or platform dashboard. But online payments can still be confusing if you don’t capture the right details—especially when fees, refunds, chargebacks, or partial payments appear.

For each online payment, aim to record:

• Payment date (the date you received it, not necessarily the date you invoiced)

• Gross amount (what the customer paid)

• Fees (if taken by the platform)

• Net amount (what you actually receive)

• Platform/reference (transfer reference, transaction ID, invoice number)

Why gross vs net matters: if a platform takes fees before the money reaches you, your bank statement might show only the net amount. Your records should still reflect the true amount the customer paid, with the fee recorded as an expense. That way your income totals are accurate and your fee costs are visible.

A practical way to handle platform fees without headaches

If you’re paid through a platform that takes fees, choose a consistent approach and stick to it. Here’s a simple method many small businesses use:

• Record the customer payment as the gross amount (income).

• Record the platform fee as an expense.

• Record the bank deposit (or settlement) as the net amount received.

In a spreadsheet with one row per payment, you can include columns for “Gross,” “Fee,” and “Net.” If you prefer less complexity, record the net amount as income and track fees separately, but be aware that this can understate your true sales if you’re not careful. The most transparent record-keeping usually includes both gross income and fees.

Prevent the two classic errors: double-counting and missing cash

Mixed payments produce two predictable problems. Here’s how to avoid them with simple habits.

Double-counting

This happens when you record cash as income and then later record the cash deposit as income again. It can also happen when you record an invoice as income and then record the payment as income again, depending on your system.

How to prevent it:

• Decide whether you record income at the invoice stage or at the payment stage.

• If you record at invoice stage, treat payments as “settling” the invoice, not new income.

• If you record at payment stage, treat deposits of cash into the bank as transfers, not income.

• Label your entries clearly: “Cash received from customer” vs “Cash deposited to bank.”

Missing cash

This happens when you forget to log a cash payment because there’s no automatic record, or when small amounts (tips, small top-ups) slip through the cracks.

How to prevent it:

• Log cash daily.

• Issue a receipt or mark the invoice as paid-in-cash immediately.

• Keep cash separate from personal funds.

• Do a weekly cash count and compare to your cash log.

Build a system around invoices and receipts (even if you’re informal)

You don’t have to be a large company to use invoice numbers. A simple numbering system helps you link payments to work performed. If you’re paid partly in cash and partly online, invoice numbers become a glue that holds everything together.

Here’s a simple approach:

• Use a format like INV-0001, INV-0002, etc.

• Add the invoice number to your spreadsheet rows.

• Ask customers who pay online to include the invoice number as the payment reference.

• If they can’t, note the name and date so you can match it later.

If you’re in a retail-style environment or you do many small sales, you can use receipt numbers instead. The concept is the same: a unique identifier that connects the sale to the payments.

Reconcile regularly so small mistakes don’t become big ones

Reconciliation sounds intimidating, but for a small operation it can be simple: it’s just checking that your records match reality. When you’re paid partly in cash and partly online, reconciliation keeps you honest and confident.

Weekly mini-reconciliation (15 minutes)

Once a week, do three checks:

1) Add up your online payments recorded for the week and compare them to your bank statement and platform settlements.

2) Add up your cash payments recorded for the week and compare them to the cash you still have plus what you deposited into the bank.

3) Look for unmatched items: a bank transfer you didn’t record, or a cash receipt you wrote but didn’t log.

Monthly deeper reconciliation

Once a month, review:

• Total income recorded vs expected based on your work completed

• Outstanding invoices (if you invoice)

• Platform fees and unusual adjustments

• Refunds, chargebacks, or disputes

• Cash discrepancies, if any

These checks don’t need to be complicated. The goal is to catch issues early and keep your records defensible.

Handling refunds and chargebacks when payments were split

Refunds get tricky when someone paid you in two methods. The cleanest approach is to mirror the original payment methods where possible. If a customer paid £50 cash and £150 online and needs a £200 refund, you can refund £50 in cash and £150 online if that’s feasible. If it’s not feasible, document what happened clearly.

From a record-keeping standpoint:

• Link the refund to the original invoice/receipt number.

• Record the refund as a negative amount (or a separate refund entry) with the method used.

• If fees were involved, note whether the platform returned fees or not.

• Keep any customer communication or confirmation messages that show the refund agreement.

The main purpose is clarity. Months later, you want to be able to explain why money went out and how it relates to earlier income.

Tips, gratuities, and “extra cash”

When you’re receiving mixed payments, you may also receive money that isn’t exactly the main price: tips, bonuses, rounding differences, or small reimbursements. These can cause confusion if they’re not consistently handled.

A simple strategy is to categorize “extra” money clearly:

• Tip/gratuity

• Bonus

• Reimbursement (if the customer is repaying you for something you purchased on their behalf)

Reimbursements are the trickiest. If you’re reimbursed for a cost you incurred (for example, materials you bought), you may prefer to record the reimbursement as income and the cost as an expense, or you may net them depending on how you track project costs. Either way, keep the paperwork: receipts for the cost and a note that the customer reimbursed it.

For tips, the simplest approach is: record them as income, label them as tips, and track whether they were cash or online.

How to handle situations where you can’t identify an online payment

Sometimes you’ll see an online payment arrive with a vague reference like “Thanks” or just a first name. If you’re also taking cash, it can get confusing quickly. To reduce this problem:

• Ask clients to use your invoice number as the payment reference.

• If you use a payment link, set it up to include the invoice number automatically.

• When you get an unidentified payment, record it as “Unallocated receipt” with the date and amount, and keep a note of the bank reference.

• When you identify it later, update your record to link it to the correct invoice or sale.

A small “unallocated” bucket prevents you from ignoring money you received just because you can’t match it instantly.

Practical templates you can copy into your own system

Below are two templates you can recreate in a spreadsheet or notebook. They’re intentionally simple.

Template 1: One row per sale (split columns)

Date | Customer | Description | Total | Cash | Online | Online method/ref | Receipt/Invoice # | Notes

Use when: most sales are paid quickly and you don’t have many instalments.

Template 2: One row per payment (best for instalments)

Payment date | Customer | Invoice # | What for | Amount | Method | Ref/Transaction ID | Notes

Use when: you often receive deposits, balances, and multi-date payments.

What to do if you’re paid cash and online for the same service multiple times

If you have repeat customers, the easiest way to stay organized is to separate “customer accounts” from “transactions.” Each time you deliver a service, create a new invoice/receipt number. Don’t let payments from different jobs blend together, even if the customer is the same. This is where consistent numbering really helps.

If a customer pays you £50 cash today and £50 online next week but it’s for two different sessions, record them as two different sales. If it’s for one session split across methods, record it under one invoice. When you keep that boundary clear, your records remain readable and you avoid arguments with yourself later.

How to keep your system simple enough to maintain

The best bookkeeping system is boring. It’s the one you can do even when you’re busy. If you’re currently overwhelmed by mixed payments, aim for a “minimum viable system” you can run every week.

Here’s a simple approach that works for many people:

• Create invoices or receipts with unique numbers.

• Use one spreadsheet tab for “Payments received.”

• Log every payment—cash or online—within 24 hours.

• Once a week, reconcile online payments to your bank statement.

• Once a week, count your cash and reconcile to your cash log.

• Deposit cash regularly and record deposits as transfers, not income.

If you do just that, you’ll have a clean, defensible record of your income, and tax time will feel far less stressful.

Common questions people ask about mixed payments

Do I need to record cash if it’s small amounts? Yes, if it’s payment for your work, it’s part of your income. Small amounts are easiest to forget, which is exactly why a daily habit helps.

What if a customer pays me cash but I spend it immediately? You still record the cash as income when received. If you spend it on business costs, record the expense as “paid in cash.” If you spend it personally, treat it as drawings/owner withdrawal (depending on how you manage your finances). Mixing personal spending with business cash is a common source of confusion, so keep notes.

Should I record the date the customer paid or the date it hit my bank? For online payments, these can differ by a day or two. Pick a rule and stick to it. Many people use the date the payment was received/settled. If you’re using invoices, the payment date is the date you received the funds.

What if the customer pays online but the platform batches payouts? Record the sale/payment using the date and amount the customer paid (gross). Then match the platform’s payout to your bank statement as the net settlement. This keeps your income accurate and clarifies fees.

A quick checklist you can use every time you’re paid partly in cash and partly online

When a mixed payment happens, run this checklist:

• Create or identify the invoice/receipt number for the sale.

• Record the full sale amount once.

• Record the cash portion as a payment: date, amount, method: cash.

• Record the online portion as a payment: date, amount, method: bank/card/platform, reference.

• Save supporting evidence (receipt copy, message, bank reference, platform confirmation).

• Update your cash balance and store cash separately.

• If you deposit cash later, record it as a transfer, not income.

Final thoughts: clarity beats complexity

Recording income when you’re paid partly in cash and partly online doesn’t require fancy tools, but it does require a clear structure. If you treat each job or sale as a single transaction and then log each payment method as part of that same transaction, you’ll eliminate the most common errors. A small routine—logging cash daily, capturing online references, and reconciling weekly—goes a long way.

Whether you use a spreadsheet, invoices with partial payments, or full accounting software, the goal is the same: create records that accurately show what you earned, how you were paid, and when you received the money. Once that’s in place, mixed payments stop being stressful and start feeling like just another normal part of doing business.