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Level 2

How do I issue a partial refund on an invoice that has been fully paid and cleared?

I have a customer that fully paid their invoice up front for two student enrollments in our program (so, two line items on the invoice). She now needs to un-enroll one of the students. We've given her the refund, but it's unclear how to record this in QBO.

 

We tried creating a Credit Memo, but it won't let us apply it to the invoice in question, since the invoice has already been paid.

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Best answer February 07, 2019

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Level 10

How do I issue a partial refund on an invoice that has been fully paid and cleared?

A c/memo is only used to credit the customer in AR, which is not what you did. You gave them money, so it's a Refund Receipt, which reduces your bank balance. The original invoice is not involved in the new transaction

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Anonymous
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How do I issue a partial refund on an invoice that has been fully paid and cleared?

Hello, RobotBen.

 

Creating a credit memo is one way of recording refunds in QuickBooks Online. Though, you can’t apply this to a paid invoice. Same as the refund receipts, they cannot be applied on a paid invoice. They just offset the amount you’ve given back to your customer.

 

You can enter a memo on the paid invoice about which part of was refunded instead.  Also, you can request your preferred way of recording refunds through feedback. Just click the Gear icon and select Feedback.

 

Thanks for dropping by.

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Level 2

How do I issue a partial refund on an invoice that has been fully paid and cleared?

Is there any advantage to using a credit memo vs a refund receipt in this situation? When do I know when to use one or the other?

Highlighted
Level 10

How do I issue a partial refund on an invoice that has been fully paid and cleared?

A c/memo is only used to credit the customer in AR, which is not what you did. You gave them money, so it's a Refund Receipt, which reduces your bank balance. The original invoice is not involved in the new transaction

View solution in original post

Highlighted
Level 10

How do I issue a partial refund on an invoice that has been fully paid and cleared?


@Anonymous wrote:

 

Creating a credit memo is one way of recording refunds in QuickBooks Online. 


No it's not at all. That what a Refund Receipt is for. Notice the word "refund" in Refund Receipt 

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Level 2

How do I issue a partial refund on an invoice that has been fully paid and cleared?

To clear up any confusion (this is based on what I've discovered), when you create a credit memo, it says "amount to refund" at the top of the screen, so I can see why they said that. It's actually confusing, in my opinion. I suppose you could think of the "refund" as being for "future payment" in order to reduce the total A/R.

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