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Record invoice payments in QuickBooks

by Intuit•33• Updated 2 days ago

Learn how to receive and record invoice payments in QuickBooks.

Note: This article is for customers using QuickBooks Online (Advanced, Essentials, Plus, and Simple Start) and Sole Trader.

In QuickBooks, you can record sales transactions in two ways. If your customer paid for the product or service at the time of the sale, you can create a sales receipt, which completes the transaction and records it in your books.

But if your customer plans to pay you in the future, you can create and send them an invoice. When the customer makes a payment on the invoice, you need to record the payment in QuickBooks. This connects the payment transaction to the original invoice so your accounts stay balanced. Here's how to record invoice payments.

Follow the steps below based on the product you are using.

Record invoice payments

After you process a payment from a customer, you need to record it in QuickBooks so the invoice is marked as paid. Otherwise, the invoice stays open and remains unpaid on your reports. You can record the full or partial payment on an invoice. Here’s how:

Record payment for a single invoice

  1. Select + New.
  2. Select Receive payment.
  3. From the Customer dropdown, select the name of the customer.
  4. From the Payment method dropdown, select the payment method.
  5. From the Deposit to dropdown, select the account you put the payment into. Tip: You can put the money directly into an account, like your current account, or select Undeposited Funds if you need to group the payment with others. 
  6. In the Outstanding Transactions section, select the checkbox for the invoice you're recording the payment on.
  7. Enter the Reference no. and Memo if needed. This is optional.
  8. When you're done, select Save and close.

Note: There are several options for saving and sharing the payment receipt. If you would like to send a payment receipt to your customer, select ▼ Save and send. It is not possible to customise your payment receipt.

Record partial payment for an invoice

Record payments even if you were only paid part of what's owed. QuickBooks keeps track of the remaining invoice balance:

  1. Select + New.
  2. Select Receive payment.
  3. From the Customer dropdown, select the name of the customer.
  4. From the Payment method dropdown, select the payment method.
  5. From the Deposit to dropdown, select the account you put the payment into. Tip: You can put the money directly into an account, like your current account, or select Undeposited Funds if you need to group the payment with others.
  6. In the Amount received field, enter the amount your customer paid.
  7. In the Outstanding Transactions section, select the checkbox for the invoice you're recording the payment on.
  8. Enter the Reference no. and Memo if needed. This is optional.
  9. When you're done, select Save and close.

If your customer pays you more or less than expected, you can make changes to a payment receipt easily. 

  1. Go to Sales and select All sales (Take me there).
  2. Locate and open the payment transaction.
  3. Edit the Amount received field.
  4. Select Save and close.

Note: If you are editing or deleting a transaction linked to others, QuickBooks will automatically alert you.

If you want to delete a payment altogether, locate and open the payment transaction and select More, then Delete. Once you have deleted a transaction, it isn't possible to reverse this.

  1. Go to Sales and select All sales (Take me there).
  2. Open the payment you want to delete. If you are not sure which payment is tied to the invoice that you are deleting the payment for, you can also open the payment by going to the invoice and selecting payment on the top right corner of the invoice.
  3. Select More.
  4. Select Void or Delete.

If you turn on the credit note auto-apply feature, QuickBooks handles this for you. Your work is done and QuickBooks applies the credit for you.

If you turned off the feature, here's how to manually apply a credit note to an invoice:

Here's how to manually apply a credit note to an invoice:

  1. Select + New.
  2. Select Receive payment.
  3. In the Customer dropdown, select the customer.
  4. In the Outstanding Transactions section, select the open invoice you want to apply the credit note to.
  5. In the Credits section, select the credit notes you want to apply.
  6. For the open invoice in the Payment column, enter how much of the credit you want to apply.
  7. Leave the Payment method, Reference no., Deposit to, and Amount received fields blank.
  8. Fill out the rest of the form, including the Payment date.
  9. Make sure the total is correct after applying the credit note.
  10. When you're done, select Save and close.

Here's how to edit or unapply the credit notes:

  1. Open the payment you have saved.
  2. Clear the checkbox of the credit notes you do not want to apply, or edit the amounts you wish to use from the available credit notes.
  3. If the payment is completely incorrect and you wish to start over, select More and then Delete, this will remove the entire payment.
  4. The process of recording payment can be redone by selecting Receive payment in the invoice window.
  1. Open the payment you have saved.
  2. Clear the checkbox of the credit notes you do not want to apply, or edit the amounts you wish to use from the available credit notes.
  3. If the payment is completely incorrect and you wish to start over, select More and then Delete, this will remove the entire payment.

To see the remaining balance for the customer:

  1. Go to Reports (Take me there).
  2. Find and open the Customer Balance Summary report.
  3. Select Run report.
  4. Review the customer's open balance in the Total column.

Note: When you record partial payments, QuickBooks applies the payment to the invoice line items in order. Additional payments apply to the next line items until the payment is complete.

Group multiple payments together into a single deposit

If you make a bank deposit with several cheques in a single deposit, use the Undeposited Funds account to record the payments in QuickBooks. This lets you group multiple payments into one deposit transaction in QuickBooks. Only do this if your bank recorded multiple payments as a single deposit.

Record invoice payments

After you process a payment from a customer, you need to record it in QuickBooks so the invoice is marked as paid. Otherwise, the invoice stays open and remains unpaid on your reports. You can record the full or partial payment on an invoice. Here’s how:

Record payments

  1. Go to Get paid and select Invoices (Take me there).
  2. Find the unpaid invoice and select Record payment.
  3. From the Deposited to dropdown, select the account you put the payment into.
  4. In the Amount field, enter the amount your customer paid. This can be the full or partial payment.
  5. In the Payment date field, select the date your customer paid you.
  6. Select Save.

If your customer pays you more or less than expected, you can make changes to a payment receipt easily. 

  1. Go to Get paid and select Invoices (Take me there).
  2. Locate and edit the payment transaction.
  3. Edit the Amount field.
  4. Select Save and close.

Note: If you are editing or deleting a transaction linked to others, QuickBooks will automatically alert you.

If you want to delete a payment altogether, locate and open the payment transaction and select More actions then Delete. Once you have deleted a transaction, it isn't possible to reverse this.

  1. Go to Get paid and select Invoices (Take me there).
  2. Open the payment you want to delete. If you are not sure which payment is tied to the invoice that you are deleting the payment for, you can also open the payment by going to the invoice and selecting View payment #.
  3. Select More actions.
  4. Select Void or Delete.

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