Payments and Collections: All Ways to Record Client and Supplier Payments

This guide explains every way in the system to record payment of sales invoices (collecting from clients) and purchase invoices (paying suppliers): when creating the invoice, after it, in installments, from prepaid credit, or for several invoices at once, along with the effect of each method.

Choose the right method

Case	Sales	Purchases
Full payment when creating the invoice	Already Paid on the invoice	Already Paid to The Supplier
Partial payment when creating the invoice	The Deposit tab	The Deposit tab
Paying later or in installments	Add Payment from the invoice	Add Payment from the purchase invoice
Paying several invoices with one amount	Add Payment Credit for the client and distribute it, or Mark As Paid	Add Payment Credit for the supplier and distribute it
Advance payment before the invoice	Add Payment Credit for the client	Add Payment Credit for the supplier
Paying from an earlier balance	The Client Credit payment method	The Supplier Credit payment method
The amount is recorded from the vouchers or journal screen	An income (receipt voucher) or Journal Entry on the client’s account, then distribute it	An expense (payment voucher) or Journal Entry on the supplier’s account, then distribute it

Sales 1: Recording payment when creating the invoice

Full payment

1. In Create Invoice, turn on Already Paid at the bottom of the invoice.
2. Choose a Payment Method and Treasury, and enter the Ref No. (such as a transfer number) if there is one.
3. If the client paid with more than one method, choose Multiple and add a line for each payment with its method, treasury and amount (the total must equal the invoice total).
4. Save the invoice. A completed payment for the full amount is recorded.

Partial payment

In the invoice’s Deposit tab, enter the paid amount (an amount or percentage) in Advance Deposit and turn on Already Paid with the payment method and treasury. The invoice is saved as Partially Paid.

Sales 2: Adding a payment to an issued invoice

1. Open the invoice from Invoices.
2. Click Add Payment.
3. The amount shows the balance remaining on the invoice; change it for a partial payment.
4. Enter the date, payment method, treasury, payment status and reference number, and save.

Repeat these steps for each payment until the invoice is Paid. Each payment appears in the invoice’s Payments tab.

Sales 3: Paying several invoices at once

• Mark As Paid: in the invoices list, select the invoices, choose Mark As Paid from the actions, and set the payment method and treasury. Each invoice gets a payment for its remaining balance, and paid invoices are skipped.
• Payment credit and distribution: if the client paid one amount for several invoices, use the next method.

Sales 4: Client payment credit and distributing it

Suitable for advance payments, or one amount covering several invoices:

1. Open the client’s profile from Clients, and click Add Payment Credit.
2. Enter the amount, date, payment method and treasury.
3. Distribute the amount over the invoices:

• If Auto Pay Invoices if the Client Has Available Credit. is on, the client’s unpaid invoices are paid automatically, from oldest to newest.
• If it’s off, the Invoices to be paid table appears, so you can set the Distribution Amount for each invoice, or distribute it later from Distribute next to the client’s balance.

To pay an invoice later from the remaining credit: from the invoice, click Add Payment and choose the Client Credit payment method.

Sales 5: Online payment by the client

If you enable online payment gateways in Payment Methods, the client can pay the invoice online from the invoice link sent to them or from the client portal; the payment is recorded automatically once it succeeds. Point of Sale payments are also recorded automatically with each invoice.

Adding credit with a receipt voucher, payment voucher or journal entry

You can also record an amount collected from a client or paid to a supplier from the vouchers or journal screen, as long as you choose the client’s or supplier’s own account. The amount is added to their balance and can be used to pay their invoices:

Transaction	Method	Journal entry
Collecting from a client	A receipt voucher (income) with the client’s account chosen in Journal Account.	Debit the treasury / Credit the client.
Paying a supplier	A payment voucher (expense) with the supplier’s account chosen in Journal Account.	Debit the supplier / Credit the treasury.
Settlement without a treasury (such as an offset or a transfer between two accounts)	A Journal Entry where the client’s account is credited, or the supplier’s account is debited.	Depends on the other side.

After recording:

• The amount appears in the client’s or supplier’s Statement, and is added to the available Client Credit.
• If auto-pay from credit is on, unpaid invoices are paid automatically, from oldest to newest.
• Otherwise, distribute the credit manually from Distribute next to the client’s balance on their page, or from the invoice with Add Payment and the Client Credit payment method (or Supplier Credit).

Purchase invoices: ways to pay the supplier

Method	Steps
When creating the invoice	In New Purchase Invoice, turn on Already Paid to The Supplier with the payment method and treasury (or Multiple). For a partial payment, use the Deposit tab. You can make purchase invoices paid by default from Purchase Invoice Settings.
After creating the invoice	Open the invoice from Purchase Invoices, click Add Payment, and enter the amount (the remaining balance by default), date, payment method and treasury.
An advance payment or one amount for several invoices	From the supplier’s profile in Suppliers, click Add Payment Credit. It’s then distributed automatically (when auto-pay is on) or from the distribution table.
From the supplier’s balance	From the invoice, click Add Payment and choose the Supplier Credit payment method.

Payment fields

Field	Description
Amount	The payment amount (by default, the balance remaining on the invoice).
Date	The payment date. It can’t be in a closed period.
Payment Method	Cash, transfer, card, or the client’s or supplier’s credit. The treasury linked to it is chosen automatically.
Treasury	The treasury or bank the amount went into or came out of.
Payment Status	Completed (the default), Pending, Incomplete or Failed.
Ref No.	An optional reference number, such as a transfer or cheque number.
Payment Details / Receipt Notes / Attachment	Details, notes and a document proving the payment.

Invoice and payment statuses

Invoice status	Meaning
Unpaid	There are no completed payments.
Partially Paid	Part of the amount is paid.
Paid	The amount is paid in full.
Overpaid	The payments are greater than the invoice total.

Journal entries

Transaction	Journal entry
Collecting from a client	Debit the treasury / Credit the client.
Paying a supplier	Debit the supplier / Credit the treasury.
Payment credit for a client or supplier, or a receipt / payment voucher on their account	The same entry as above, when the amount is recorded.
Paying an invoice from the client’s or supplier’s credit	No new entry is created; it’s a distribution of an amount already recorded.

If the invoice is in a foreign currency and the exchange rate is different at the time of payment, a currency difference entry is recorded.

Editing or deleting a payment

• From the invoice’s Payments tab, choose Edit or Delete next to the payment (depending on your permissions, and as long as it isn’t in a closed period).
• Automatic payments from the client’s or supplier’s credit (marked Auto) can’t be edited or deleted until auto-pay is turned off.
• After a payment is deleted, the invoice goes back to unpaid or partially paid.

FAQs

How do I record a payment on an invoice?

Open the invoice and click Add Payment, or turn on Already Paid when you create it.

The client paid one amount for several invoices. What do I do?

Use Add Payment Credit for the client with the amount and distribute it over the invoices, or let it be distributed automatically.

I recorded a receipt voucher for the client. How do I use it to pay their invoice?

If the voucher is on the client’s account, the amount is added to their balance. Distribute it from Distribute on the client’s page, or from the invoice with the Client Credit payment method, or it’s paid automatically if auto-pay is on.

I recorded a payment but the invoice is still unpaid. Why?

Make sure the payment status is Completed, and that the invoice isn’t a draft.

How do I print the payment receipt?

Open the payment from the Payments tab or the payments list, and print the receipt.