Why mark an invoice as paid?

If we take care of your bookkeeping as part of your package with us, then we'll handle reconciling payments against the appropriate invoices for you.

However, if you want to take advantage of Xero's invoice reminder feature, it's important to mark invoices as paid when your customers have paid you. Otherwise, Xero may continue to send payment reminders to customers who have already paid.

How to add a payment:

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Step 1 - Log in to Xero

Open your web browser and go to Xero login App.

Alternatively download the Xero app from your smartphone app store - The app works really well for invoicing your customers on the go.

  • Enter your Xero email address and password.

  • Click “Log in”.

If you don't currently have a Xero account - talk to us and we'll set you up.

 

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Step 2 - Head to 'Invoices'

After logging in, you’ll land on the Dashboard.

In your browser:

  • From the top menu, click “Sales” → “Invoices.”

On the app:

  • From the bottom icons, click “Sales”

If this is your first time, you may have to configure some invoice settings - Follow the on-screen instructions.

Invoice Index:

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Step 3 - Find the invoice

You'll see a list of your invoices.

Find the invoice you have received payment for. You can use the search or filter options to help you find it.

Click on the invoice to open it.

Adding Payment

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Step 4 - Add the payment

Once you have opened the invoice, click Add Payment.

Step 5 - Enter the payment details

Enter:

  • Date paid - the date you received the payment - ensure this is the date that the amount hit your account
  • Paid to - select the bank account the payment was made into
  • Amount paid - the amount your customer has paid

Then click Add Payment.

Step 6 - Check the invoice status

The invoice will now show as Paid.

You can return to Sales → Invoices at any time to see which invoices are awaiting payment, overdue or paid.

Top tip: Keep your invoices updated as payments come in. This will help you keep track of outstanding amounts and make sure your customers only receive invoice reminders when they are actually needed.

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Frequently Asked Invoicing Questions

What if my customer only pays part of the invoice?

Enter the amount they have actually paid when adding the payment. Xero will show the remaining balance as outstanding.

What if a customer pays several invoices in one payment?

You can record the payment against the relevant invoices. Make sure the amounts allocated to each invoice match the payment you've received.

What if I mark an invoice as paid by mistake?

You can remove or edit the payment from the invoice. This will return the invoice to its outstanding status.

Do I need to mark an invoice as paid if you do my bookkeeping?

Not if you don't want to. If we take care of your bookkeeping, we'll reconcile payments against your invoices for you. You only need to mark invoices as paid yourself if you want to keep Xero's invoice reminder feature up to date between bookkeeping periods.

What if I don't see the "Add Payment" option?

It's likely you don't have the appropriate permissions in Xero. Get in touch with us and we'll be happy to help.

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