Your customer has paid an invoice twice
Instead of receiving a refund, they may prefer to have the second payment applied against their next invoice. A credit note is the way forward.
- If you have already reconciled the second payment, we need to unreconcile it. Follow the steps in our help guide Are there duplicate invoices or bills?
- Now we need to re-reconcile that second transactionion - when in the reconciliation screen, click on ‘Add details’.
- In the resulting pop-up, record the money ‘Received as’ Overpayment. Fill in the relevant line items, including the customer name and click ‘Save Transaction’
When you create a future invoice for this customer, Xero will ask if you want to apply the overpayment to the invoice. You do. The invoice is then sent to the client, showing the sale price less the amount already paid.
You've paid a bill twice
If you want the overpayment to be offset against future bills (like the customer above), follow those same steps. The only difference is that instead of 'Receive Money as Overpayment' in step 2, you "Spend Money as Overpayment'.
The alternative is to ask your supplier to refund the money.