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Create and apply adjustment notes or delayed credits in QuickBooks Online

Learn when and how to give a adjustment note or delayed credit to customers in QuickBooks Online.

Unsure whether to enter a adjustment note or delayed credit? Here, we outline what makes these two different, and how you can apply them to your customer transactions.

Note: If you need to make a refund, here’s how to return your customer’s payment.

Some customers prefer using their refund as available credit they can use to reduce the balance on their next invoice.

In QuickBooks, you can give credit to a customer using a adjustment note or delayed credit. If you're new to these types of transactions, here are the key differences between the two:

Adjustment note

  • Your customer can use their adjustment note as a payment to an invoice. They can choose to use all of their adjustment note or a portion of it.
  • You can apply a adjustment note when recording payment for a customer’s invoice.
  • Adjustment notes impact sales reports, even when you don't apply them on invoices.

Delayed credit

  • Your customer can use their delayed credit to reduce the balance of an invoice.
  • You can add a delayed credit to an invoice as a line item.
  • Unlike adjustment notes, unused delayed credits don't impact sales reports until you apply them to invoices.
  • If you want to track a customer's credit for future use but don't want it to affect their current balance, use a delayed credit.

Create and apply a adjustment note

Step 1: Create a adjustment note

  1. Select + New.
  2. Select Adjustment note or Give credit.
  3. Enter the customer’s name, then fill out the required fields:
    • Date
    • Products/service items
    • Quantity
    • Amount
  4. Select Save and close.

Step 2: Apply the adjustment note to an invoice

You can choose to manually or automatically apply adjustment notes to open invoices.

Manually apply a adjustment note

Here's how to manually apply a adjustment note to an invoice. This process gives you control over which open invoice you can apply a adjustment note to.

  1. Select + New.
  2. Select Receive payment or Receive invoice payment.
  3. Enter the customer’s name, then fill out the required fields:

    Note: Make sure you choose the same customer or project you selected in the invoice.

    • Date
    • Memo (optional)
  4. Leave the fields Payment method, Reference no, Deposit to, and Amount received blank.
  5. In the Credits section, select the adjustment note from Step 1. Then, in the Payments column, enter how much credit your customer want to use.
  6. Make sure the total to pay (if any) is correct after applying the adjustment note.
  7. Select Save and close.

Automatically apply adjustment notes to invoices

Here's how to automatically apply adjustment notes. This lets QuickBooks use adjustment notes as payments for newly created or open invoices.

  1. Go to Settings ⚙, then select Account and Settings.
  2. Select Advanced tab, then select Edit ✎ in the Automation section.
  3. Select Automatically apply credits.
  4. Select Save, then Done.

Create and apply a delayed credit

Step 1: Create a delayed credit

  1. Select + New.
  2. Select Delayed credit. Or if you're in Business view, follow the steps to switch to Accountant view first. Then come back to these steps.
  3. Enter the customer’s name, then fill out the required fields:
    • Date
    • Products/service items
    • Quantity
    • Amount
  4. Select Save and close.

Step 2: Apply the delayed credit

Note: Keep in mind that adding a delayed credit to an invoice from a prior accounting period will affect that period's balances.

  1. Select + New.
  2. Select Invoice or Send Invoice.
  3. Select the customer you want to apply the credit to, then fill out the fields as usual.

    Note: You should see the available credits from the right of your invoice screen. If you don’t, select the small arrow next to the invoice balance.

  4. To add a delayed credit to the invoice, select Add.
  5. select Save and close.

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