Navigation:  Customers > Customer refunds

If customer has paid in advance, paid more than they were due or you have issued a credit note, their credit will be reported under Customer credits liability account (money is owed to a customer - so it is a liability).

 

Customer credits will be automatically applied to their next invoice.

 

If next invoice is unlikely to be issued any time soon or if customer has requested refund to be paid back to them, you can reduce their credit balance by paying them back. For example, if the payment was from a cash account:

 

Go to Cash accounts tab.

 

Click on Balance amount under cash account from which you are refunding customer.

 

Record new transaction by clicking on Spend money button.

 

Select account Customer credits, then select customer. Also enter the amount customer has received.

 

 

Save the transaction by clicking Create button.

 

Follow the similar steps if they are being refunded from bank account or through expense claims.