If you have received a payment from a client for a sales invoice, you can manually record it against the invoice in Xero. Once the payment has been recorded, it can be reconciled against the relevant bank transaction when it comes through the bank feed. In this tutorial, we will manually record a payment on a sales invoice in Xero’s demo company and see where it appears in the bank account.

You can copy the steps taken here by using the Demo Company in your Xero account. To learn more about invoicing in Xero, please see our tutorials on sales invoices in Xero.

Sales Invoices Section in Xero

To get to the right place in Xero, go to Business → Sales overview from the main menu:

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Now click on the Awaiting Payment section to see all the sales invoices that have been created but not paid by the customers:

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How to Record a Payment on a Sales Invoice in Xero

Let’s choose the first unpaid invoice on the list for this exercise. Click anywhere on the row of the Bayside Club to open the invoice:

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At the bottom of the invoice template, you should see a section called Receive a payment. Here, you can add details of either a full or part payment of the invoice. For this tutorial, we will add details of the full payment of the invoice as follows:

  • Amount Paid: type in 234.00.
  • Date Paid: choose today’s date.
  • Paid To: choose 090 – Business Bank Account.
  • Reference: type in the invoice number ORC 1039.

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Click on the Add Payment button when you are ready. If the payment was successful, you will see a message at the top of your screen confirming that the payment has been recorded on the invoice:

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Check the Payment in the Bank Account

Let’s take a look at where the invoice payment appears in the bank account. From the main menu, go to Accounts → Bank Accounts and click on the link for the Business Bank Account:

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Click on the Account Transactions tab if it is not already open:
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Here you should see a transaction for the payment of $234.00 you recorded against the Bayside Club invoice:

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Congratulations! You have successfully recorded a payment on a sales invoice and it is now ready to be reconciled once the transaction comes through the bank feed.

You’re All Set!

That’s it for this lesson. For more helpful tutorials on sales invoices in Xero, please follow this link. For other Xero tutorials, please click here.