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Kh29
Level 3

Refund of invoice which has been partially paid.

Hi, we've got a customer that partially paid an invoice (let's say £10 of a £50 invoice) and I then linked the bank transaction to the invoice in QBO, showing a partial payment with an outstanding balance of £40. He has now cancelled his order so we've sent him the £10 back via BACS transfer but I'm not sure how we manage this in QBO. I assume I'll need a transaction of some sort to show the £10 refund and also close of the remaining £40 on the invoice. Not sure what they should be though. If I do a refund transaction for the £10 and link that to the BACS transfer, what do I create for the remaining £40?

12 REPLIES 12
Ashleigh1
QuickBooks Team

Refund of invoice which has been partially paid.

Hello KH29, 

 

Welcome to the Community page, 

 

For the £10 the steps below will show you how to do the refund in Quickbooks for you. 

 

Refund your customers

1. Go to the + icon in the top right corner of the screen and create a expense
2. select the customer, the date the money left your account and expense from the debtors account- save and close
3. go back to the + icon, select credit note, fill in the customer name and amount- save and close
4. go to sales on the left side of your screen, click customers at the top of your screen and find the appropriate customer
5. click new transaction on the top right of your screen and select payment
6. on the next screen tick the expense and credit note (make sure no other transactions are ticked- save and close)This will show the customer refund.

 

 

This will work and leave the invoice open with £50 again which will be up to you on what you want to do with that £50 but if the order is cancelled you could just either void or delete it in the system. 

 

If you have any further Q's p[lease reach back out to us. 

Kh29
Level 3

Refund of invoice which has been partially paid.

Hi Ashleigh1

 

Thanks for this. The only option to create an Expense is under the Supplier heading, is that the right one to use?

 

Also, should I unlink the original bank transaction payment from the invoice before I do this? And then link it to this new Expense?

 

Thanks,

Karl

GeorgiaC
QuickBooks Team

Refund of invoice which has been partially paid.

Hi Karl, 

 

The Expense under the Supplier heading is the correct one to use, you'll be able to enter your customer as the payee when creating the transaction. 

 

Did your customer originally pay the full amount of the invoice before cancelling a part of the order, and was then issued a partial refund?

 

If so, you can record the full payment to the invoice and match this to the money which hit your bank account, and then follow the steps above to create the expense/credit note/payment to reflect the refund, which will then match to the money going out of the account. 

 

Get back to us is you have any questions, thanks :):thumbs_up:

Kh29
Level 3

Refund of invoice which has been partially paid.

Hi GeorgiaC

 

Thanks for the reply. As I described above, the customer made a partial payment towards an invoice. I recorded the partial payment against the invoice. We've now refunded him the partial payment but I'm not sure how to record that in QBO at the same time as cancelling the remainder of the invoice.

 

Thanks,

Karl

GeorgiaC
QuickBooks Team

Refund of invoice which has been partially paid.

Hi Karl, 

 

For the partial payment, leave this recorded against the invoice as you'll need to show that you received this money, and then follow the steps provided above to record the refund. 


To write off the remainder of the invoice, you can simply edit the original invoice itself so that it only reflects the partial amount which was paid, or you can create a credit note to the customer, selecting the same product/service and quantity which was used on the invoice, and then apply this by selecting 'receive payment' on the invoice and ticking the credit note under 'Credits'. If you're using stock tracking, this will then correct your quantity on hand stock value. 

Kh29
Level 3

Refund of invoice which has been partially paid.

Hi,

 

I'm afraid I'm a little lost now. Which steps above, yours or Ashleigh, and which steps? I assume not all of them as described as some refer to the full amount etc... Do I apply a credit for the whole invoice amount or only the remainder?

 

Could you set out the exact steps your suggesting?

 

Thanks,

Karl

Ashleigh1
QuickBooks Team

Refund of invoice which has been partially paid.

Hello Kh29, 

 

You need to do the steps I sent you to record the refund. 

 

Then you need to follow the steps that Georgia sent you to write off the rest of the invoice. 

Liz18
Level 1

Refund of invoice which has been partially paid.

Never mind. I found the answer. 

Thank you!!

Bambam33
Level 1

Refund of invoice which has been partially paid.

HI Liz, could you let us know the answer, would be so grateful!

John C
QuickBooks Team

Refund of invoice which has been partially paid.

Hi Bambam33 The easiest way to refund a customer that has partially paid an invoice/sales receipt and then the order is cancelled or indeed has fully paid is to use the refund receipt option within the New+ field. If you there is an invoice that has been partially paid, or not paid at all and you'd like to write the amount of you would create a credit note for the amount that needs to be written off, so if 50% of the invoice has been paid and refunded you'd be writing off the remaining 50%.

Bambam33
Level 1

Refund of invoice which has been partially paid.

Dear John, do you realise how crazy this is, our book keeper did this another way, your instructions are so confusing and nothing is clear. It is costing customers so much time in trying to understand the processes and costing more in employing people to sort out their quickbooks, which is supposed to replace a book keeper.

Please make clear concise instructions available. in bullet points, not long incoherrent sentences, thank you.

 

John C
QuickBooks Team

Refund of invoice which has been partially paid.

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