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ANSWER ID:9100

If a customer has overpaid you, or you've overpaid a supplier, you cancreate a credit for the overpayment then:

apply the overpayment to another invoice, or
process a refund for the overpaid amount.

Both options are handled in a similar way for both customer and supplier overpayments.

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(Australia only) For an overpaid paycheque, see our support note Payroll overpayments - creating a negative paycheque (Australia only).

Recording and settling customer overpayments

There are 2 tasks involved in this: Recording the overpayment, then settling the overpayment.

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title	1. Record the overpayment

Go to the Sales command centre then click Receive Payments.
Click the drop down arrow next to the Customer field and select the customer who has made the overpayment.
Enter the customer's payment details including the Amount Received, Date, and Memo.
If the invoice that has been overpaid is closed, select the option Include Closed Sales.
Click in the Amount Applied field against the invoice to be paid and the software will then automatically insert the outstanding invoice amount.
Overtype the outstanding invoice amount with the same amount that was entered in the Amount Received field. Alternatively, if the customer has other open invoices, click in the Amount Applied field to apply the overpayment to these invoices.
Click Record.
Click OK to the credit memo alert which will be displayed if more than the outstanding amount has been applied against an invoice.

The window below shows the Receive Payments window and the application of a customer overpayment.

Notes:

The balance owing on invoice #19 is $110.00, and the customer has paid $120.00. To record the $10.00 overpayment, $120.00 must be entered in both the Amount Received and Amount Applied fields.
Alternatively, $110 of the payment could be applied against invoice #19, and $10 could be applied against the balance outstanding on another invoice.
Ensure the overpayment amount is not included in the Finance Charge field. If this has occurred and the transaction has been recorded, our support note Finding and deleting or reversing a finance charge will help.
If the amounts entered in the Amount Received and Amount Applied fields are different, the following unbalanced transaction alert will be displayed when you click Record:

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title	What if the customer double-pays a single invoice?

This situation is where a customer accidentally pays the outstanding balance of an invoice - twice. In this case, the first payment can be applied against the open invoice as shown above. However, when you attempt to record the second payment (the overpayment), the Receive Payments window no longer displays the applicable invoice because it is now closed (paid). To apply the second payment to the same invoice, select the option Include Closed Sales at the bottom of the Receive Payments window.

The closed (paid) invoice can now be displayed and you can apply the second payment to it. Note that you will not be able to find the closed invoice by dollar amount, as it now has $0 owing. Instead, you will need to find it by the Invoice Number and/or Date. This will create a credit memo for the second payment which can then be settled as described below.

Note: If a customer has triple-paid a single invoice, you can complete the above steps for the first overpayment (i.e. the second payment), but this won't work for any additional overpayments. Instead, you'll need to create a $0 sale for the customer against which you will be able to record the additional overpayment. This will create another credit note which can then be settled as described below. In the event that several overpayments occur, these steps need to be followed for each subsequent overpayment of the same invoice.

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title	2. Settle the overpayment

Settling the overpayment can be done in 2 ways:

Refund the overpayment: Access the credit memo through the Sales Register and use the Pay Refund function.
Apply the overpayment to another invoice: Access the credit memo through the Sales Register and use the Apply to Sale function.

To do this:

Go to the Sales command centre then click Sales Register.
Click the Returns & Credits tab. The window below shows the Sales Register with a credit memo highlighted.

To refund the overpayment:
Click to highlight the credit memo then click Pay Refund. The software will then display a refund cheque payment.
Confirm the details of the refund cheque payment.
Click Record.
To apply the credit memo to another invoice:
Click the credit memo then click Apply to Sale.
Select the invoice against which you want to apply the credit by clicking in the Amount Applied column for the invoice.
Click Record.

Recording and settling supplier overpayments

There are 2 tasks involved in this: Recording the overpayment, then settling the overpayment.

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title	1. Record the overpayment

Go to the Purchases command centre and click Pay Bills.
Click the drop down arrow next to the Supplier field and select the supplier you have overpaid.
Enter the supplier's payment details including the Amount, Date, and Memo.
If the purchase that has been overpaid is closed, select the option Include Closed Purchases.
Click in the Amount Applied field against the purchase to be paid and the software will then automatically insert the outstanding amount.
Overtype the outstanding amount with the same amount that was entered in the Amount field. Alternatively, if the supplier has other open purchases, click in the Amount Applied field to apply the overpayment to these purchases.
Click Record.
Click OK to the debit memo alert.

Notes

Ensure the overpayment amount is not included in the Finance Charge field. If this has occurred and the transaction has been recorded, our support note Finding and deleting or reversing a finance charge will help.
If the amounts entered in the Amount and Amount Applied fields are different, the following unbalanced transaction alert will be displayed when you click Record:

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title	What if I've double-paid a supplier for a single bill?

This situation is where you've accidentally paid the outstanding balance of a supplier's bill - twice. In this case, the first payment can be applied against the open bill as shown above. However, when you attempt to record the second payment (the overpayment), the Pay Bills window no longer displays the applicable bill it is now closed (paid). To apply the second payment to the same bill, select the option Include Closed Purchases at the bottom of the Pay Bills window.

The closed (paid) bill can now be displayed and you can apply the second payment to it. Note that you will not be able to find the closed bill by dollar amount, as it now has $0 owing. Instead, you will need to find it by the Purchase Number and/or Date. This will create a debit memo for the second payment which can then be settled as described below.

Note: If you have triple-paid a single supplier bill, you can complete the above steps for the first overpayment (i.e. the second payment), but this won't work for any additional overpayments. Instead, you'll need to create a $0 purchase for the supplier against which you will be able to record the additional overpayment. This will create another debit note which can then be settled as described below. In the event that several overpayments occur, these steps need to be followed for each subsequent overpayment of the same bill.

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title	2. Settle the overpayment

Settling the overpayment can be done in 2 ways:

Receive a refund for the overpayment: Access the debit memo through the Purchases Register and use the Receive Refund function.
Apply the overpayment to another purchase: Access the debit memo through the Purchases Register and use the Apply to Purchase function.

To do this:

Go to the Purchases command centre then click Purchases Register.
Click the Returns & Debits tab. The debit memo will be displayed.
To receive a refund for the overpayment
Click to highlight the debit memo then click Receive Refund. The software will then display a refund cheque payment.
Confirm the details of the refund cheque payment.
Click Record
To apply the debit memo to another purchase
Click the debit memo then click Apply to Purchase
Select the purchase against which you want to apply the debit by clicking in the Amount Applied column for the purchase.
Click Record.