Pay purchase invoices

In this article we explain how to match payments and credit notes to pay or part pay an invoice.

Do this so

  • You can see which invoices still need to be paid.

  • The outstanding balance for supplier contact is accurate.

  • The invoice doesn't appear on supplier statements or aged creditor reports.

How it works

Match a credit note or payment to an invoice. Once matched

  • The invoice is marked as paid or part-paid and the outstanding amount is updated.

  • The balance of the supplier account updated.

  • If you use Cash BasisVAT scheme, the value is recorded on your next VAT return.

Use the Unallocated Receipts or Payments report to identify payments that aren’t allocated to a purchase invoice.

If you've matched the payment or credit note to the wrong invoice you can unallocate it. Read how to unallocate tranaactions

Watch how

Match a single payment on account or a credit note

  1. From Contacts, select the supplier.
  2. From the Manage drop-down, choose Account Allocation.
  3. Select the check box for each the payment on account or credit note. We update the Outstanding value to 0.00 and show the amount is moved in the Paid column.

  4. The Left to Allocate box at the bottom should be 0.00.

  5. Click Save.

Match multiple payments or credit notes

  1. From Contacts, select the relevant supplier.
  2. From the Manage drop-down, choose Account Allocation.
  3. Select the payments on account or credit notes you want to use.

  4. Select the invoices you want to pay.

  5. The Left to Allocate box at the bottom should be 0.00.

  6. Click Save.

Part pay invoices and credit notes

This is where you only use part of the value of payment on account or credit note or part-pay an invoice.

  1. From Contacts, open the relevant supplier.
  2. From the Manage drop-down, choose Account Allocation.
  3. Choose next to the transaction you want to part pay.
  4. Enter the value in the Amount to pay section and select Apply.

    For payments on account, enter this a negative value.

  5. Make sure the Left to Allocate box at the bottom is 0.00.

  6. Click Save.

Troubleshooting

Check your allocations

Check which payments and credit notes have been used to pay an invoice.

  1. Open the invoice credit note from the relevant list or from the Activity section for the relevant supplier.

    Select the payment link under the Amount Paid value.

    This opens the Payments and Allocations option.

  2. From here you can see all the payments links related to the invoice or credit note. Select the link in the Amount column to see the details.

Mismatch error

If you use the Cash Basis VAT scheme and you try to allocate invoices and credit notes which have different VAT rates, we display the following error

On this scheme, the VAT calculated on invoices is placed in a VAT holding nominal ledger account until you record the payment. Once you match the payment to the invoice, we move the VAT amount to the VAT on purchases ledger account. It is then included on a VAT Return.

If no payment is received and instead you credit the invoice, we remove the value from this as no VAT is due. If the credit note has a different VAT rate, some value may remain in the holding account.

Related content

Delete a purchase invoice