A bill credit is a credit note against a supplier bill: the supplier reduces what you owe on a non-goods bill. Use one when a service invoice was overstated and the supplier corrects it, when you are given a rebate or an allowance, or when a billed service is credited back to you. It is the mirror image of a bill: where a bill records what you owe a supplier, a bill credit backs part of that amount out again. The bookkeeper, the accountant, or the owner usually enters one.
A bill credit posts the moment you save it. Like a bill, it records amounts against accounts, not products, so it never moves stock. It belongs to the non-goods path: it reverses a bill, not a GRN. To send goods back to a supplier and take them out of stock, use a GRN Credit instead.
| Document | Use it when |
|---|---|
| Bill Credit | A supplier credits a non-goods cost: an overstated service invoice, a rebate, an allowance. |
| GRN Credit | Goods you received go back to the supplier and out of stock. |
Find bill credits under Purchase & Supplier → Bill Credit.
Before you start
- The supplier crediting you must exist in Suppliers. Picking the supplier pulls in its billing and delivery addresses, its default AP account, and its default payment term.
- An Accounts Payable account must exist in your Chart of Accounts. The bill credit debits this account, so it must be of type Accounts Payable. The supplier's default AP account prefills it.
- Each line posts to an expense or other ledger account, which must exist in the Chart of Accounts. A line cannot use an Accounts Payable or Accounts Receivable account. At least one account line is required to save.
- To reverse tax on a line, a tax payable account must be configured under Tax settings, since the tax reverses there.
- You need the Create Bill Credits permission, granted per user under Permissions. List Bill Credits lets you open the screen, and Edit, Delete, View, Print Bill Credits, and Copy to Bill Credit cover the rest. See Users, seats & permissions.
Raise a bill credit
Open a new bill credit
Go to Purchase & Supplier → Bill Credit and select New Bill Credit. The bill credit form opens full screen.
Check the template
The Template picker sits in the toolbar at the top of the form. ZyncLedger pre-selects your default bill credit template, so you can usually leave it. The template decides which fields the form shows and how the printed credit looks; switch it here if you keep more than one layout. See Print templates for how these are set up.
Choose the supplier
Select the Supplier (required). ZyncLedger fills the Billing Address and Delivery Address from the supplier's record, sets the AP Account to the supplier's default, and sets the Payment Term and Due Date from the supplier's default term. The supplier's current Balance shows below the field for reference.
Confirm the AP account
Check the AP Account (required). This is the Accounts Payable account the bill credit debits, that is, the account that carries what you owe the supplier. It prefills from the supplier, and the list only offers accounts of type Accounts Payable.
Set the bill credit date
Enter the Bill Credit Date (required). This is the date the credit posts to the ledger, so it decides which period the reversal falls in.
Set the payment term and due date (optional)
The Payment Term and Due Date prefill from the supplier's default term when you pick the supplier. ZyncLedger calculates the Due Date from the term and the bill credit date. You can override the due date directly, or leave both blank unless your template marks them required.
Set the transaction number
The Transaction Number identifies the bill credit. How you fill it depends on the number mode for bill credits:
- Automatic (the default): the field shows Auto-generated and ZyncLedger assigns the next number when you save. Leave it alone.
- Manual: you type the number yourself. It is required and must be unique across all transactions.
See Document numbering to change the mode or set up a multi-series numbering scheme.
Add a reference and dimensions (optional)
Fill any of these if they help:
Field What it does Bill Credit Reference Your own reference, such as the supplier's credit note number. Location Tags the credit to a location for reporting. It prefills the location on each line. Branch Tags the credit to a branch for reporting. It prefills the branch on each line. You can also edit the Billing Address and Delivery Address that prefilled from the supplier; both are optional.
Add the account lines
For each cost being credited, fill a row in the accounts table:
Column What it does Account (required) The expense or ledger account this credit posts to. Accounts Payable and Accounts Receivable accounts are not allowed here. Description The line text. Enter what is being credited. Name An optional party to tag the line to, for your reports. It prefills with the supplier. Location / Branch Optional reporting dimensions for the line, defaulting from the header. Amount (required) The value of the line before tax. It must be greater than zero. Tax % / Tax Amount A tax to reverse on the line, entered either way. The line total, including any tax, is calculated for you. A blank row waits at the bottom of the table, so a new line appears as you start filling the last one. To remove a line, select the trash icon at the end of its row. The Summary on the right totals the Subtotal, Total Tax, and Final Amount as you type.
Add a credit reason (optional)
Use Credit Reason / Notes at the foot of the form to record why the credit was raised. If you keep standard wording, pick it from the note selector to autofill.
Save
Select Save & New to save and start another credit, Save & Close to save and return to the list, or Save & Print to save and print this one. The bill credit saves with a status of Open and posts immediately.
What it posts
A bill credit reverses a bill, so it posts the mirror image. It debits (reduces) the Accounts Payable account in the header by the credit's final amount, including tax, lowering what you owe the supplier. Against that, it credits:
- Each line's account for its amount before tax. This is usually an expense account, so the cost is backed out of your Profit & Loss.
- Any tax on a line back to your tax payable account.
The debit to Accounts Payable always equals the credited lines and their tax, so the entry balances. It flows through to the Trial Balance, the General Ledger, the Profit & Loss (for the expense lines), and the Balance Sheet (for the payable).
A bill credit has account lines only. It has no product or item lines, so it moves no stock and reverses no cost of goods sold. To send goods back to a supplier and take them out of stock, use a GRN Credit instead.
Saving a bill credit also reduces the supplier's balance by the final amount, since you now owe them less overall. That open credit is what a Supplier Payment later applies against an outstanding bill.
How a bill credit settles a bill
Raising the credit lowers your overall balance with the supplier, but on its own it does not mark any one bill as settled. The credit sits as an open credit against the supplier. To apply it to a particular bill's outstanding balance, allocate it on a Supplier Payment, which can settle open bills with the credit. That allocation is what moves the bill toward Closed and settles the credit itself.
The bill credit's own status tracks how much of the credit you have used up:
| Status | What it means |
|---|---|
| Open | The credit is posted and none of it has been applied yet. This is the status of every new bill credit. |
| Partial | A Supplier Payment has applied part of the credit, but not all of it. |
| Closed | The credit has been fully applied. |
| Deleted | The credit has been deleted (see below). It is kept for the record but its amounts are zeroed. |
A bill credit's status is about how much you have used it
The status above measures how much of the credit has been applied, not whether the supplier has credited you. A bill credit posts its ledger effect in full the moment you save it, so it starts Open and moves to Partial or Closed only as you apply it on a Supplier Payment.
Tips & gotchas
Bill Credit or GRN Credit?
Use a bill credit to credit a supplier cost that never arrived as goods, such as a service, a utility, or an expense: it reverses the payable against your accounts. Use a GRN Credit when goods physically go back to the supplier and you want them out of stock. A bill credit is the accounts path; it does not credit a GRN.
An applied or reconciled credit is locked
Once a Supplier Payment has applied part of a bill credit, ZyncLedger will not let you delete it, reduce the total below what has been applied, or change the supplier or AP account. Reverse the payment first. A line that has been reconciled on a bank reconciliation, or a date in a period closed by the Ledger close date, also blocks changes.
Deleting a bill credit removes its postings
There is no reversing entry. Deleting a bill credit sets its status to Deleted, removes its lines from the ledger, and raises the supplier's balance again. ZyncLedger blocks the deletion if any payment has been applied to the credit, if any of its lines have been reconciled on a bank reconciliation, or if its date falls in a period closed by the Ledger close date, so settled and locked history stays intact.
Related
- Bill is the supplier cost a bill credit reverses.
- Suppliers are the parties who credit you, and carry the addresses, default AP account, and default payment term the credit uses.
- Chart of Accounts holds the Accounts Payable, expense, and tax accounts a bill credit posts to.
- Payment terms set the due date on a bill credit.
- GRN Credit is the separate path for crediting goods that go back to the supplier and out of stock.
- Supplier Payment applies an open bill credit against your open bills and pays the balance.
- Purchasing reports list your bill credits and how much of each is still open.
- Document numbering controls the bill credit's transaction number.
