Accounting → Payments is one register for money paid to vendors and received from clients. A single payment can settle several bills or invoices from the same party. Any part that settles nothing is held as an advance until you apply it.
Before you start
- Add the vendor or client first.
- The account the money moved through must be in your chart of accounts as a Bank, Cash, Credit Card, Payment Clearing, Other Current Asset or Other Current Liability account.
Record the payment
- Go to Accounting → Payments.
- Click Record Payment for money you paid a vendor, or Record Receipt for money a client paid you.
- Record as at the top of the form switches between Payment Made · Vendor and Payment Received · Client.
- Choose the Vendor or Client.
- Choose the Currency and enter the Amount.
- For any currency other than INR, also enter the Exchange rate (the value of 1 unit in rupees).
- Set the Payment Date or Receipt Date.
- In Paid From or Received In, choose the bank, cash or card account the money moved through.
- Choose the Mode, such as Bank Transfer, Cheque or UPI, and enter the Reference / UTR.
- Split the amount across the open bills or invoices, as described below.
- Optionally add Notes / Description. It's added to the narration of every journal line the payment posts.
- Click Save payment.
A payment's Payment No is optional. Leave it blank and one is generated. A receipt's Receipt No is assigned when you save, from the receipt prefix in Settings → Invoices.
Settle several bills or invoices at once
Once you choose the party, their open documents appear under Unpaid Bills or Unpaid Invoices:
- Tick a row, or type an amount in its Payment column.
- Click Apply Full to fill one row with its full due amount.
- Click Auto-apply to spread the amount over the rows, oldest first. With rows ticked, it spreads only across those. With no amount entered, it fills every row at its full balance and sets the amount to the total.
- Click Clear to empty the split.
A row can't take more than is due on it, and the split can't be more than the payment amount. The Summary card shows how much is applied and how much is left On account.
Advances and amounts left over
If part of the payment isn't applied, or the party has nothing outstanding, SmartLedger asks where to hold the rest when you save:
- For a payment made, choose an account in Store the advance in. It must be an Other Current Asset or Non Current Asset account, usually Advance to Vendors.
- For a receipt, choose an account in Store the overpayment in. It must be an Other Current Liability or Non Current Liability account, usually Unearned Revenue.
Click Confirm & save, or Back to the split to apply more of it first.
In the register, these payments show as On account or Partial. To apply the money later, click the payment to open it, then search for an open bill or invoice under Apply this payment or Apply this receipt. You can also click Create Bill & Link or Create Invoice & Link to raise a new document against it. Applying an advance moves it into Accounts Payable or Accounts Receivable without touching the bank again.
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