Incorect credit applied by debtor

Hi Security360 

Thanks for your post. This is how you usually handle customer overpayments: Customer overpayments and double payments.  And this is usually how you settle the credit: Settling customer credits. 

You can apply the credit note to an open invoice or if they have no open invoices, you can hold onto the credit note and apply it to a future invoice or record a refund.

Thank you for your assistance Yanike, however maybe I didn't explain the situation correctly.

The invoice was over paid several weeks ago, leaving the client with a credit.  When the client applied the credit to their next payment, instead of applying the credit amount, they applied the full amount of the invoice eg:

Invoice                                           $1,000.00

Paid                                                $1,500.00

Credit                                             $    500.00

Credit applied to next payment $1,000.00

Owed by client                              $    500.00 

Hi Security360 

Thanks for the clarification. How did the client apply this credit? It appears that they underpaid you. Once they pay the remaining $500 you can record that payment against the invoice. 

Thanks Yanike

Credit was applied to a payment that consisted of several invoices.

The trouble is trying to clear the overpayment in the last financial year and repayment (when it comes) in this financial year.

Thank you for your assistance

Hi Security360 

It is still unclear to me how your client applied the credit/payments to the invoices. I would recommend you replicate exactly in the software what has occurred in real life by recording the payments and credits in your software as they occured. The help articles I gave you previously can shine some light on that, as well as this one: Receiving payments.

If you are unsure what the effects are when this crosses financial years I would recommend talking to your accounting advisor.