Payment Entry

A Payment Entry records money moving between a party and your bank or cash. Its Payment Type decides the direction: Receive debits the bank or cash account chosen through the Mode of Payment and credits Debtors for the customer; Pay debits Creditors for the supplier and credits bank or cash. The References table allocates the paid amount against open invoices, which is what turns an invoice from Unpaid to Paid and keeps the party balance right; money received with no invoice stays as an unallocated advance. The Deductions table can carry TDS or bank charges, so the bank line can be smaller than the invoice. Reference number and date are needed for bank reconciliation. Submitted entries lock.

Unallocated amount = Paid amount - Sum of allocated amounts - Deductions; ACC-PAY-2026-00001: Rs 36,160 - Rs 36,160 = 0

1. 01Open the submitted invoice and click Create > Payment, or go to Payments > Payment Entry > New.
2. 02Set Payment Type Receive or Pay and pick the Party Type and party.
3. 03Pick the Mode of Payment; the bank or cash account fills in as Paid To or Paid From.
4. 04Enter the Paid Amount and the posting date.
5. 05Click Get Outstanding Invoices and set Allocated against each invoice in the References table.
6. 06Enter the cheque or transfer number in Reference No and its date in Reference Date.
7. 07Save and Submit. The entry below posts, the invoice status updates and the entry locks.

Create from the invoice's Make Payment button or Accounts > Payment Entry. Submitted entries lock and cannot be deleted, cancel and amend instead.

ACC-PAY-2026-00001 receives Rs 36,160 from Jivan Dahal and marks ACC-SINV-2026-00004 Paid.