How to Apply Overpayment in Xero When Receiving Money

Quick summary

This tutorial shows how to apply an overpayment in Xero by using the Receive Money workflow and selecting Overpayment as the received-as type. Following these steps ensures the excess payment is correctly recorded against your accounts receivable in Xero's banking module.

Steps

1. On Xero's main dashboard, go to the top menu bar and click Create New.
2. Choose Receive Money from the list of options.
3. Select the bank account you wish to use, then click Next.
4. Click the drop-down menu next to Received As.
5. Select Overpayment from the drop-down list.
6. Fill out the input fields with the required information related to accounts receivable.
7. Once done, click Save to record the transaction.
8. The overpayment is now applied to your receive-money transaction in Xero.