Apply overpayment to new invoice or bill

If your customer or supplier has outstanding credit from an overpayment, Xero prompts you to allocate the credit next time you approve a sales invoice or bill for that contact.

  1. Enter the new invoice or bill.

    Add a sales invoice

    Add a bill

  2. When you approve the invoice or bill, Xero will prompt you to allocate the outstanding credit. Click Allocate.

    Allocate credit from pop-up window telling you about outstanding credit.

  3. Enter the amount to apply as credit on the invoice or bill.

    You can allocate less than the full amount of the overpayment, for example if the overpayment is more than the amount of the invoice or bill.

    Image showing credit allocated.

  4. Click Allocate Credit.