Create Customer Credit

A customer/client credit balance refers to an amount that you owe to a customer. It's when a customer has paid you more than the current invoice stipulates. This overpayment could later be used as a retainer to offset their invoice or you could also refund it to them by creating a credit memo.

This help article will give you a better understanding of how to create customer credit. Check out the outlined steps below to get started.

Article Overview

Access accounts receivable
Enter invoice overpayment
Check customer credit

Step-by-Step Guide

Access accounts receivable

Go to the accounts receivable page and search for the invoice number.

Then click the payments button at the end of the invoice row. A pop-up window of invoice payments should appear where you could enter your invoice payment.
Enter invoice overpayment

You can now enter the invoice payment. Fill in the payment details fields your client made and hit save. As for the example in the photo below, the invoice amount is $1,314.54. The client made a payment of $2,000.00 which created an excess amount of $685.46.

A warning message below the payment details will appear which explains that the overpayment will go to the client’s account and could be applied to a future invoice or return it with a credit memo.
Check customer credit

We could check the customer credit by going to the clients page and search for the client name. A summary of client details should appear on the client’s row. In here, we could already see the client we’ve created.

We could also check it on the draft invoice page. Go to draft invoice page and scroll down to the project summary section. There you will see the credit amount available to be applied/offset to the future invoices.

If you want to see the accounting entry that was created from the overpayment, go to the financial reports page, select general ledger, and then search for the invoice number.