Add or edit a sales invoice
If you raised sales invoices in your existing accounting system (before you started using Xero) that are still outstanding or partly outstanding, you'll need to re-enter each of these invoices into Xero. The fields for entering historical invoices are much the same as those used to enter normal sales invoices.
Add a sales invoice (for someone to pay you) and send it to them. You can also use these instructions for adding historical invoices (if prompted to if you've made changes to your conversion balances or you're entering them now because you didn't have them during setup) and editing draft invoices or invoices you have copied.
Elsewhere in the Help Centre:
Add a sales invoice from the Dashboard, Sales section or directly for one of your customers from their Contact Details screen. If you've updated your Sales Conversion Balance and it requires a corresponding invoice to make up the difference, you will be taken to the New Invoice screen directly.
Editing an existing sales invoice that has a status of Draft or Awaiting Approval is the same as creating a new one. Follow the instructions below for editing the invoice fields or performing other editing options like copying invoices, printing or sending invoices, or turning them into automatically repeating invoices.
If you've received the invoice from Xero to Xero, all the fields on the invoice will be completed for you (by the organisation that sent the invoice) except for the account and tracking fields which you'll need to complete and approve for payment. If you've received the invoice from an Xero add-on, Xero will display a link to the original invoice in the third-party's system.
Use these same fields to edit an existing
invoice that is draft, awaiting approval or awaiting payment. Depending on your user role you may only be able to edit those invoices that you created.
Only the To and Invoice # fields are mandatory if you want to save the invoice as draft. Otherwise you must complete all fields.
Once you have saved or approved the invoice, send a PDF or online invoice to your customer (as your user role allows).
Enter or edit the details of who the invoice is for.
If you're adding an historical invoice, keep the invoice number, Account(s) and Tax Rate(s) the same as when the invoice was issued from your previous accounting system. Enter the Unit Price to be the outstanding amount as at the date you are converting to Xero. This might not be the original invoice amount if part of the invoice has already been paid.
Select or enter the organisation or person you are invoicing.
The date will be entered automatically as the day before your conversion date and if you have the invoices to hand you should change this to use the date off the invoice. You can use a different date if you don't, as long as it remains before your conversion date.
The date of the invoice. If you're entering an invoice issued before your conversion date from a previous system, make sure the date is before your conversion date so that this invoice can be associated with your Sales conversion balance.
Again, if you have the invoices to hand, you should use the original due date on the invoice, however you can use any date as long as it's not before the invoice date.
The date the invoice is due to be paid to you.
The automatically generated invoice number being the next one in the sequence you have set up (Settings > General Settings > Invoice Settings). You can change the invoice number but it must be unique. The automatic numbering sequence will take this new invoice number into account when it generates the next number for the next new invoice or credit note generated (if the new number belongs in the sequence). If an invoice is deleted or voided the invoice number stays with it however you can re-use the number on a deleted invoice. You can free-text search for the invoice number in Xero once the invoice is created.
If you have set up Contact Groups and you're adding an invoice to be duplicated for all the Contacts in the group, there will be no invoice number until all the invoices are generated for each Contact when you have finished entering the invoice details. An invoice will be generated for each Contact in the group and sequential invoice numbers applied to each.
The Reference field is optional, and Branding (if it appears) can be left as it is if you do not wish to override the default (whichever theme appears in the field automatically).
This field is optional. Enter a combination of letters and/or numbers as a reference if applicable. If you do enter a reference, it will display on your invoices along with the automated invoice number. The reference you enter here will also appear in the reference column on statements you produce for this customer in future, where this invoice is listed.
If you receive multiple transactions for the same amount into your bank account, use the reference field to help match them automatically with your Xero invoices. Ask the payee to use the reference you've used (in either their Particulars, Code or Reference field) when they set up their payment. This way Xero will automatically match the statement line with your invoice when you're reconciling.
You can free-text search for the invoice number in Xero once the invoice is created.
If the invoice was received from Xero to Xero, the reference field may already be populated if your customer entered a reference when they created the invoice at their end. You can choose to leave this as is or delete or change it if the invoice numbering system used for your sales invoices is enough.
The Branding field will only appear if you have a choice of more than one branding theme within your organisation.
To set up DOCX branding themes or to edit a standard theme, go to Settings > General Settings > Invoice Settings.
Choose the branding you would like to apply to this invoice from the drop-down list.
Delete or add as many lines as needed to create your invoice.
Depending on your user role you may only be able to choose existing inventory items, accounts and tracking options and not add new ones.
Account and Tracking don't appear on your print invoice, they're entered for your accounting and tracking purposes. (Item code does if you choose to leave it as a template field in your DOCX theme) Choose if other columns will show by updating the PDF invoice format (Invoice Settings).
Use the invoice grid to enter the details of the transaction, using as many line items as required (there must be at least one). If needed, you can use different inventory items, accounts, tax rates, tracking options, prices (positive, negative or zero amounts) and discount percentages on different lines, as necessary.
If you specified default account or tracking details for this contact, those details will be added to the invoice by Xero. Xero will populate these fields with the default values when you click or tab into the Account or tracking fields. You can change a default option to another option, if required.
The invoice entry grid defaults to five lines, and you can tab between them or stretch and shrink columns to see more or less in a similar way to using a spreadsheet. Once you have saved the invoice, any lines you haven't used will be removed from the grid and if you need more later you can just add them using the Add new line button or delete them using the 'X' icon. Only the lines you enter data into will appear on the PDF invoice - blank lines are removed and don't print. Invoices that haven't been paid can have items in the grid edited (i.e. invoices that are draft, awaiting approval or awaiting payment) and you can also add and remove line items as necessary.
Choose the tax treatment for the invoice, in other words how tax will be calculated and displayed on the invoice using the 'Amounts are' list. Choose whether the invoice is to have No Tax, or is to be exclusive or inclusive then specify the tax rate applied to each line item (below).
Find out more about how the tax treatment chosen and tax rates applied determine what amounts are reported on your GST Return in How the GST Return works in Xero.
Find out more about how the tax treatment chosen and tax rates applied determine what amounts are reported on your VAT Return in How the VAT Return works in Xero.
Find out more about how the tax treatment chosen and tax rates applied determine what amounts are reported on your BAS Return in the GST Calculation Worksheet.
Find out more about how transactions are displayed on your Sales Tax Summary report based on the tax treatment chosen and tax rates applied.
By default, at first the invoice will show the tax setting used on the most recently approved invoice (no tax, tax exclusive or inclusive). You can change this to another of the three options from the 'Amounts are' drop-down. If the invoice has tax applied, each line will use the tax rate determined by the Account you're coding the invoice item to. Once the invoice is entered and approved, the tax will display on the Awaiting Payment invoice as exclusive regardless of how you've entered it.
Invoice amounts are tax exclusive
For each item entered GSTVATSales Tax is not included in the line item amount and is calculated on top of the subtotal and shown separately in the final invoice amount.
Making VAT Adjustments
You may want to make adjustments to VAT if the tax amount applied to a sales invoice differs from what Xero calculates based on the percentage showing in the Tax Rate column. One example might be when you are offering a prompt payment discount. VAT adjustments can only be made where the 'Amounts are' box is set to Tax Exclusive.
The adjustment can be made via the Tax Amount column. If the column is not already showing, it can be opened using the '+' icon on the Tax Rate column. If you enter a tax amount here which differs from the one Xero has calculated (on the basis of the tax rate chosen), the difference between the standard tax amount and your adjusted amount will show in the 'Includes Adjustments to Tax' box above the invoice total. Note that this adjustment box will not appear on PDF (printable) versions of customer invoices.
To clear a tax adjustment, simply enter 0.00 into the 'Includes Adjustments to Tax' box.
Invoice amounts are tax inclusive
For each item entered GSTVATSales Tax is included in the line item amount and is extracted from the subtotal and shown separately in the final invoice amount.
Invoice amounts are no tax
For each item entered the Tax Rate column will not be editable, therefore no tax will be applied or shown in the invoice total. Read more about items that have no tax rate in How the GST Return works in Xero How the VAT Return works in Xero the GST Calculation Worksheet the Sales Tax Summary report.
If you have set up inventory items in Xero you can choose an item from this list. Doing this will automatically populate your invoice fields, using the information you have saved against the inventory item.
Your own description of the item (use additional lines for each item if required) - enter as much or as little text as you like to describe your goods or services being credited. The description box will expand while you are editing, letting you type as much as you need. You may also use 'Enter' to apply line breaks within a description field.
If you wish to enter a text-only line, for example as a heading to separate out items into categories (such as labour and materials), do so by entering text into the description field and leaving all other fields blank.
If you wish to list items for which there is no charge, enter an explanatory description and a unit price of 0.00. Other fields, such as 'Account' and 'Tax Rate' may be left blank.
If you're using an inventory item, and want your item code to display on the PDF invoice, enter it into the description.
Everything you enter will appear on the print version of the invoice and will add pages to the PDF as it needs to.
Enter or edit the quantity (if applicable) for the line item.
Price for the line item – you can enter positive, negative or zero amounts (as long as the overall invoice amount is not negative). The overall total amount displayed for the invoice will take into account all line items and the tax options chosen.
You can apply a discount percentage to the invoice line's unit price. Enter a positive discount to 2 d.p.
Default discounts for contacts will display
If you've entered a default discount for your contact it'll automatically display here, but you can override it on the invoice line.
Entering a zero discount
If you enter zero as your discount and your invoice branding is set up to show discounts, 0% will display on the customer's invoice.
Tax inclusive invoices with discounts
When you're adding a tax inclusive invoice, the discount is deducted from the tax inclusive unit price. The discount value (displayed in brackets by the subtotal) is also tax inclusive.
Once your invoice is approved, the invoice will display as tax exclusive, and the subtotal and discount values (which are also tax exclusive) will reduce.
Select the account (from your Chart of Accounts) that the item is to be assigned to.
To search for an account that starts with or includes certain characters, type the characters in the Account box, then select the desired account from the list of possible matches. For example, you can type '20' or 'al' to search for '200 - Sales.'
If a suitable account does not exist in the list, you can add one directly from here using the '+Add new account ...' option at the top of the account list. This adds a new account to the Chart of Accounts and the information to be completed is the same as when you are creating an account directly in the Chart of Accounts.
If you are editing an invoice and the account previously used has been deleted or archived it will no longer be available to select.
The tax to be applied to the line item. By default, this will be the tax rate assigned to the account you chose for this item from the Chart of Accounts. You can change the tax rate for this invoice, if required.
To search for a tax rate that starts with or includes certain characters, type the characters in the Tax Rate box, then select the desired tax from the list of possible matches. For example, you can type '15' or 'com' to search for '15% GST on Income.' For example, you can type '17' or 'com' to search for '17.5% VAT on Income.' For example, you can type 'GS' or 'com' to search for 'GST Free Income.' For example, you can type "12" or "ter" to search for "Inter-State Tax (12%)."
The total amount of tax will be shown in the invoice total, calculated as inclusive or exclusive depending on the treatment you chose for the invoice. You can choose for the print version of the invoice to show the tax rate used on each line item or not on the Invoice Settings screen.
If you want to change the default tax applied to the chosen account, you must modify the account through the Chart of Accounts.
Once setup is complete, you can add optional Tracking Categories, and select a tracking option for each line.
A column for each tracking category will display if you have set them up for this organisation. If you want the items on your invoice to be tracked, choose the required options from the one or two tracking categories displayed. If you don't want to use tracking on this invoice (or a particular line item) just leave it blank or choose '(None)'.
To search for a tracked option that starts with or includes certain characters, type the characters in the Tax Rate box, then select the desired option from the list of possible matches. For example, you can type 'Op' or 'tion' to search for 'Operations.' For example, you can type 'Ma' or 'ith' to search for 'Martin Smith.' For example, you can type 'Od' or 'son' to search for 'Odette Garrison.' For example, you can type "Caf" or "ply" to search for "Cafe supply."
If a suitable tracking option does not exist in the list, you can add one directly from here from here using the '+Add new ...' option at the top of the list. Enter the new option for the tracking category and from now on it will appear in the list of options for this category when you are entering or editing any other transactions or running reports.
You can also add more options through Settings > General Settings > Tracking.
Once tracking is applied, the item will be included in any reports that are filtered by the tracking options you chose.
If you are editing a transaction and the tracking category or option previously used was deleted it will no longer be available.
Got an invoice line you want to move up or down or insert? Add the invoice line, click on the field to the left of the Item field, then drag and drop it where you want it to sit.
The following options for processing an invoice may or may not display depending on whether you are adding a normal day-to-day invoice or an historical invoice as the result of making changes to your conversion balances.
Your role will determine which buttons you see and how many options are available for each button.
Sales invoices role comparison
Your pricing plan will determine the number of invoices that are able to be approved each month. For more information about invoice limits see Xero pricing.
Create draft invoices for contact groups
The Create draft invoices button only displays if you are creating an invoice to be sent to all Contacts in a Contact Group. Once you have completed the basic invoice details, as many invoices as are required will be generated and saved onto the Draft tab - each to one of the Contacts in the group, each with its own sequential invoice number.
Once created, the draft invoices behave the same way as any other invoice on the Draft tab and can be printed, emailed, deleted or processed.
Historical invoices are saved as automatically approved and when setup is complete, can be viewed from the Awaiting Payment tab.
Save/Save & return to list
If you are adding or editing an historical invoice, save it and return to the list of historical invoices.
Save & add another
If you have many historical invoices to enter, use this option to save the one just entered and create another one without returning to the list of historical invoices.
All fields are mandatory when entering and saving historical invoices.
If your accounts have been locked your role and the type of lock will determine whether you can approve an invoice with a date before the lock date. Your user role will also determine whether you can approve invoices.
Any new details entered will be cleared and not saved.
Enter a note specific to this invoice at any time in History & Notes.
Depending on your user role, some or all of these actions will be available.
Once the invoice is entered into Xero, it is saved in Sales with the other invoices and credit notes and can be viewed and processed as required:
As a basic rule of thumb - if an invoice has not yet been paid, it can be edited and deleted; once it has been approved you can pay, credit, void and edit it. Invoices and credit notes in the same status have the same editing rules - refer to Edit or delete invoices & credit notes.
The following options for editing invoices do not apply to historical invoices; they can be edited as described above for adding a new invoice.
Enter or edit
Edit existing invoice details using the same
fields and buttons as for creating a new invoice. Depending on your user role you may only be able to edit those invoices that you created.
Update an existing draft or awaiting approval sales invoice by following the same instructions for entering a new invoice above.
Update an awaiting payment invoice when you're in the invoice, using Invoice Options > Edit.
Editing repeating invoices
If the invoice was created automatically as a repeating invoice a panel will display at the top of the invoice telling you this.
You can edit just this occurrence of the invoice by updating the fields as normal.
If you want to change the schedule for this repeating invoice, follow the link to 'View this repeating transaction template'.
Your user role will determine which invoice options are available.
Print or email a draft invoice
Invoices are sent to your customers as PDFs or online invoices. You need to save an invoice before you can print or email it. As long as the invoice has a Contact name and an invoice number it can be saved as a draft.
Click the Invoice Options button for a list of actions you can perform on invoices that are draft, awaiting approval or awaiting payment.
Invoice options display specifically to the type and status of an invoice. For draft or awaiting approval invoices the options are:
Invoice Options > Repeat
You can choose to use an existing invoice as the basis for creating a new repeating invoice. If the invoice you are working on was generated from a repeating schedule, the 'Repeat' invoice option will not display.
Invoice Options > Delete
Deleted invoices are removed from the Draft or Awaiting Payment tab and stored on the All tab for tracking and archive purposes.
You can re-use the invoice number used on a deleted invoice only – the number will still remain on the deleted item as well as on the new invoice so that every number in the numbering sequence can be accounted for.
If you delete an invoice that was created automatically from one sent to you from Xero to Xero, you will need to enter it again manually or request that another one be sent to you. The company that sent you the invoice doesn't know what you do with it once it's inside your organisation.
View more information on deleting invoices in Edit, delete or void an invoice, bill or credit note.
Invoice Options > Copy
A copy of the original invoice will be created.
In addition, awaiting payment invoices also have options:
If you are editing the invoice you can view the changes that have been tracked for the invoice in History & Notes) once it has been created. If the invoice was created automatically (via a repeating transaction or from Xero to Xero, the invoice history will show this.