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How to Add Payment Received

Overview​

Recording payments received from customers updates invoice balances, maintains accurate accounts receivable, and provides cash flow visibility. This guide walks through adding new payment entries step by step.

Prerequisites​

Before adding payment received:

  • Customer must exist in system with active invoices
  • At least one unpaid or partially paid invoice available
  • Bank account configured where payment was deposited
  • Payment received in your bank account or cash

Step-by-Step Guide​

Step 1: Navigate to Payment Received​

  1. Click Sales in left sidebar
  2. Select Payments Received from submenu
  3. Click Add Payments Received tab at top

Step 2: Select Customer​

Customer Name Field:

  1. Click customer dropdown or search box
  2. Type customer name to search
  3. Select correct customer from results
  4. Customer details auto-populate (address, GSTIN)

What Happens:

  • System loads all unpaid/partially paid invoices for this customer
  • Invoice list appears in "List of Invoice" section below
  • Customer's registered business name and address displayed

Key Points:

  • Only customers with pending invoices show up
  • If customer not found, check if invoices exist
  • GSTIN and address pulled from customer master

Step 3: Enter Payment Details​

Payment ID:

  • Auto-generated by system
  • Format: PAYREC-XXXX (e.g., PAYREC-1004)
  • Sequential numbering
  • Cannot be edited
  • Unique identifier for this payment

Payment Date:

  • Click calendar icon
  • Select date payment was made/received
  • Defaults to today's date
  • Cannot be future date
  • Should match bank credit date

Received On:

  • Click calendar icon
  • Select date funds credited to your account
  • Usually same as payment date for RTGS/IMPS
  • May differ for cheques (deposit date vs clearance date)
  • Important for cash flow tracking

Step 4: Choose Payment Mode​

Payment Mode Dropdown:

Select how customer paid:

  • RTGS: Real-time gross settlement, large amounts
  • NEFT: National electronic funds transfer
  • IMPS: Immediate payment service
  • Credit card: Card payment gateway
  • Debit Card: Direct bank account debit
  • Cash: Physical cash received
  • Cheque: Traditional cheque payment
  • Bank Account: Generic bank transfer

Best Practice:

  • Choose exact mode customer used
  • Helps in bank reconciliation
  • Required for payment analytics
  • Important for audit purposes

Step 5: Enter Reference Number (Optional)​

Reference# Field:

Enter transaction reference based on payment mode:

For RTGS/NEFT/IMPS:

  • Enter UTR (Unique Transaction Reference) number
  • Example: 987654321234
  • Found in bank statement or payment confirmation
  • Critical for bank reconciliation

For Credit/Debit Card:

  • Enter authorization code or transaction ID
  • From payment gateway confirmation

For Cheque:

  • Enter cheque number
  • Example: 123456

For Cash:

  • Leave blank or enter receipt number

Note: While optional, always capture this for electronic payments to simplify reconciliation later.

Step 6: Select Deposit Account​

Deposit To Dropdown:

  1. Click dropdown arrow
  2. Select bank account where payment deposited
  3. Options include all configured bank accounts

Common Options:

  • Bank Account (default current account)
  • ICICI Bank Account
  • HDFC Bank Account
  • Cash on Hand
  • Other configured accounts

Why Important:

  • Tracks which account received funds
  • Critical for bank reconciliation
  • Needed for multi-bank management
  • Affects account-wise cash flow reports

Step 7: Select Invoices to Apply Payment​

List of Invoice Section:

Table displays all pending invoices for selected customer:

ColumnDescription
Invoice NumberUnique invoice identifier
SO#Linked sales order (if any)
Invoice Due DatePayment deadline
Total AmountOriginal invoice amount
Pending AmountOutstanding balance
Payment AppliedAmount to pay now (editable)
CheckboxSelect for full payment

How to Apply Payment:

Method 1: Full Payment (Checkbox)

  • Check the box in "Full payment" column
  • System auto-fills "Payment Applied" with full pending amount
  • Use when customer pays complete invoice amount

Method 2: Partial Payment (Manual Entry)

  • Leave checkbox unchecked
  • Manually enter amount in "Payment Applied" column
  • Enter any amount less than or equal to pending amount
  • Use when customer pays partial amount

Method 3: Multiple Invoice Payment

  • Check multiple invoice boxes OR
  • Enter amounts across multiple invoices
  • Total payment distributed across selected invoices

Real Example from Screenshot:

Invoice INV-007372:

  • Total Amount: ₹11,800
  • Pending Amount: ₹11,800
  • Full payment checkbox selected
  • Payment Applied: ₹11,800

Invoice INV-007371:

  • Total Amount: ₹3,17,495.52
  • Pending Amount: ₹3,17,495.52
  • Full payment checkbox selected
  • Payment Applied: ₹3,17,495.52

Invoice BILL-1059:

  • Total Amount: ₹236
  • Pending Amount: ₹236
  • Full payment checkbox selected
  • Payment Applied: ₹236

Total Payment: ₹3,29,531.52

Step 8: Verify Payment Amount​

Payment Amount Field:

  • Displays total of all "Payment Applied" amounts
  • Auto-calculates as you select invoices
  • Should match actual amount received from customer
  • Located at top right of form

Verification Checklist:

  • Does total match bank credit amount?
  • Does total match customer's payment advice?
  • Are all intended invoices included?
  • Any invoices mistakenly selected?

If Amount Doesn't Match:

  • Review each "Payment Applied" entry
  • Uncheck unintended invoices
  • Adjust partial payment amounts
  • Contact customer if discrepancy exists

Step 9: Handle Tax Deduction (If Applicable)​

Tax Deducted Section:

Two options:

No Tax Deducted (Default):

  • Check this box if customer paid full amount
  • No TDS deducted at source
  • Most common scenario

Yes, TDS (Income tax):

  • Check this if customer deducted TDS
  • Additional fields appear for TDS details
  • Enter TDS amount and certificate details
  • System adjusts payment allocation

Example: Invoice Amount: ₹10,000 TDS @ 2%: ₹200 Payment Received: ₹9,800

In this case:

  • Select "Yes, TDS"
  • Enter TDS amount ₹200
  • Payment received shows ₹9,800
  • Invoice gets fully settled (₹9,800 + ₹200 TDS)

Step 10: Add Notes (Optional)​

Notes Section:

Text area for internal remarks:

Common Uses:

  • Special payment terms discussed
  • Reason for partial payment
  • Customer commitment for balance
  • Any payment-related issues
  • Instructions for finance team

Example Notes:

  • "Customer agreed to pay balance by month-end"
  • "Partial payment due to invoice dispute on item X"
  • "TDS certificate to be collected"
  • "Payment received via payment gateway, fees deducted"

Tips:

  • Keep notes concise and factual
  • Include dates if referencing future commitments
  • Note who you spoke with at customer end
  • Useful for follow-up and audit trail

Step 11: Save Payment​

Three Action Buttons:

Cancel:

  • Discards all entries
  • Returns to payment list
  • Use if starting over

Update:

  • Saves payment record
  • Updates invoice balances
  • Records cash inflow
  • Updates accounts receivable
  • Ready for bank reconciliation

Choose Update when:

  • All details verified
  • Payment amount matches bank credit
  • Invoice selection confirmed
  • Ready to finalize transaction

What Happens After Update:

  • Payment appears in Payments Received list
  • Selected invoices marked as Paid/Partial Paid
  • Invoice balances reduce by payment amounts
  • Customer's outstanding balance updates
  • Payment available for reporting and reconciliation

Field Reference​

Required Fields​

FieldDescriptionValidation
Customer NameCustomer who made paymentMust exist in customer master
Payment IDSystem-generated identifierAuto-generated, unique
Payment DateDate payment madeCannot be future date
Received OnDate funds creditedShould be ≥ payment date
Payment ModeMethod of paymentMust select from dropdown
Deposit ToBank account receiving fundsMust select configured account
Payment AmountTotal receivedMust equal sum of applied amounts
Invoice SelectionInvoices to settleAt least one invoice required

Optional Fields​

FieldPurposeWhen to Use
Reference#Transaction referenceFor bank transfers, card payments
NotesInternal remarksSpecial instructions, follow-up needed
TDS DetailsTax deducted at sourceWhen customer deducts TDS

Common Scenarios​

Scenario 1: Full Payment for Single Invoice​

Situation: Customer pays complete amount for one invoice via RTGS.

Steps:

  1. Select customer: "AMAR ENTERPRISES"
  2. Payment date: 06-09-2025
  3. Received on: 09-09-2025
  4. Payment mode: RTGS
  5. Reference#: UTR number from bank
  6. Deposit to: Bank Account
  7. Check "Full payment" box for invoice INV-007372
  8. Verify payment amount: ₹11,800
  9. Click Update

Result: Invoice INV-007372 marked as Paid, zero balance remaining.

Scenario 2: Multiple Invoice Settlement​

Situation: Customer sends one payment to clear three pending invoices.

Steps:

  1. Select customer: "AMAR ENTERPRISES"
  2. Enter payment details (date, mode, reference, account)
  3. Check "Full payment" boxes for:
    • INV-007372: ₹11,800
    • INV-007371: ₹3,17,495.52
    • BILL-1059: ₹236
  4. Verify total: ₹3,29,531.52
  5. Matches customer's payment advice
  6. Click Update

Result: All three invoices marked as Paid, customer account cleared.

Scenario 3: Partial Payment​

Situation: Customer pays 50% now, balance later.

Steps:

  1. Select customer
  2. Enter payment details
  3. For invoice INV-007372 (₹11,800 pending):
    • Do NOT check "Full payment" box
    • Manually enter ₹5,900 in "Payment Applied"
  4. Payment amount shows: ₹5,900
  5. Add note: "Balance ₹5,900 due by 30-09-2025"
  6. Click Update

Result: Invoice remains Open, pending reduced to ₹5,900. Customer can pay balance later.

Scenario 4: Payment with TDS Deduction​

Situation: Customer deducts 2% TDS on ₹10,000 invoice, pays ₹9,800.

Steps:

  1. Select customer
  2. Enter payment details
  3. Payment amount: ₹9,800
  4. Select invoice with ₹10,000 pending
  5. Check "Yes, TDS (Income tax)"
  6. Enter TDS amount: ₹200
  7. Payment Applied for invoice: ₹9,800
  8. Add note: "TDS certificate pending"
  9. Click Update

Result: Invoice fully settled (₹9,800 payment + ₹200 TDS = ₹10,000). TDS tracked separately for tax filing.

Scenario 5: Advance Payment (No Invoice Yet)​

Situation: Customer sends advance before order shipment.

Steps:

  1. Select customer
  2. Enter payment details
  3. No invoices selected (or create dummy advance invoice)
  4. Payment amount: As received
  5. Add note: "Advance for SO-1234, to be applied when invoiced"
  6. Click Update

Alternative Approach:

  • Create advance invoice/receipt
  • Apply payment to advance invoice
  • Adjust when actual sales invoice generated

Result: Payment recorded, available as customer credit to apply later.

Scenario 6: Overpayment by Customer​

Situation: Customer accidentally pays more than invoice amount.

Steps:

  1. Record payment for actual amount received
  2. Apply full pending amount to invoice
  3. Excess creates credit balance
  4. Add note: "Overpaid by ₹XXX, credit to be adjusted in next invoice"
  5. Contact customer about excess
  6. Options: Refund excess OR apply to future invoices

Result: Invoice paid, customer has credit balance for future use.

Tips & Best Practices​

Pro Tips

Daily Recording: Record payments same day as receipt to maintain accurate cash position and avoid backlog

Reference Numbers: Always capture UTR/transaction IDs for electronic payments for hassle-free reconciliation

Oldest First: Apply payments to oldest invoices first to reduce aging and improve collection metrics

Verify Before Save: Double-check payment amount matches bank credit before clicking Update

Use Notes: Document any special circumstances, commitments, or follow-up actions needed

Partial Payments: Clearly communicate remaining balance and due date to customer after partial payment

TDS Tracking: Maintain separate record of TDS deductions and collect certificates promptly

Payment Mode Accuracy: Use correct payment mode consistently for accurate payment analytics

Same-Day Processing: Process and apply payments on receipt day to give real-time AR visibility to sales team

Bank Statement Matching: Keep reference numbers handy when reconciling bank statements

Troubleshooting​

Issue: Customer not appearing in dropdown

  • Check if customer exists in Customers master
  • Verify customer has unpaid or partially paid invoices
  • Ensure customer is active, not deleted
  • Try searching by customer code instead of name

Issue: No invoices showing in list

  • Confirm invoices exist for this customer
  • Check if all invoices already fully paid
  • Verify invoice status is not "Draft" or "Cancelled"
  • Look for invoices in different business unit if multi-BU setup

Issue: Cannot enter amount more than pending

  • System limits payment applied to pending amount per invoice
  • If customer overpaid, record full pending amount
  • Excess will create credit balance automatically
  • Or split payment across multiple invoices to absorb excess

Issue: Payment amount not matching total

  • Review each "Payment Applied" entry
  • Uncheck any accidentally selected invoices
  • Recalculate and verify totals
  • If customer paid less, use partial payment feature

Issue: Wrong payment mode selected

  • Click Cancel, don't click Update
  • Start over with correct payment mode
  • If already saved, edit the payment record
  • Correct payment mode important for reporting

Issue: Reference number too long

  • Reference field has character limit
  • Enter only essential part of UTR/transaction ID
  • Include enough digits to uniquely identify in bank statement
  • Add full reference in Notes if needed

Need help? Contact support at support@bizconnekt.com