Customer credit is money that you owe to the customer, and which can be used against future payments.
Customer credits in DEAR Inventory can arise in the following ways:
- Credit notes issued as store credit rather than cash payment
NOTE: Customers in POS can make deposits on layby sales or receive store credit, however, these will only apply to POS sales and will not be able to be used against sale invoices processed through the DEAR web portal. See Returning a Sale - POS for more information.
- Set up Accounts (necessary).
- Set up Bank Accounts (necessary).
- Set up Customers (recommended).
- Familiarity with Processing a Purchase (necessary).
Table of Contents
- Set Up an Account for Customer Credits
- Add a Customer Credit
- View Customer Credit
- Use Customer Credit
Set Up an Account for Customer Credits
Before you can use Customer Credits, you will need an account to hold them. It must be a liability account and (for Xero and DEAR standalone users) have the ability to accept payments. Xero and QBO users can create accounts through their accounting system, DEAR standalone users can go to Settings → Reference Books → Financials → Chart of Accounts. For more information about account settings and creating accounts, see Accounts and Chart of Accounts.
Once you have prepared your Customer Credit account, go to Settings → Reference Books → Financials → Account Mapping to make sure it is correctly mapped. Save your changes to finish.
Add Customer Credit
Once you have an account to hold your customer credits, you can start adding customer credits for your different customers. There are three methods of adding a customer credit: through a purchase order, through a credit note/refund, and through the Receive Money function. Customers in POS can make deposits on layby sales or receive store credit, however, these will only apply to POS sales and will not be able to be used against sale invoices processed through the DEAR web portal. See Returning a Sale - POS for more information.
Through a Sales Quote
Customer credit can be allocated to a customer through a sales quote, for example, if a prepayment or deposit has been given for an item or service.
Add customer credit through a sale quote:
- Create a new sale by navigating to Sale → New Sale or choose an existing sale quote.
- Make sure the Skip Quote box is NOT checked.
- Fill in the quote details as required.
- Authorise the quote.
- Click +Customer Credit to add the credit details. Unless an Undo operation had been performed on the sale quote previously, this step will only become visible once the sale quote has been saved or authorised. If an Undo operation had been performed on the sale quote previously, you can add a customer credit before authorising the quote.
- The deposit account field will be auto-filled by the account set up for customer credits. Fill in the rest of the credit details and click Create.
- The Customer Credit will be added to the sale quote, ready to be used against the invoice.
Through a Credit Note
The Credit Note function can be used to add a customer credit If the customer has been overcharged, wrongly charged, and/or needs to be refunded.
Add customer credit through a credit note:
- Navigate to Sale → Sales and choose a sale to which the credit note will be applied. It must be a sale with an authorised invoice.
- On the Sale Details page, click the Credit Note tab and enter the details for the credit note. See Customer Credit Notes and Refunds for more details on credit notes.
- Authorise the credit note. If prompted to restock, proceed to Step 4. Otherwise, skip to Step 6.
- On the Restock tab, authorise the Restock action.
- Click the Credit Note tab again.
- Scroll down to the Refunds section. Click Customer Credit to add the credit note value to the customer's account. When you make a sale to this customer in the future, they will be able to use their customer credit as a payment method.
Through Receive Money
Creating customer credits through the Receive Money feature is useful when a customer has made a prepayment which does not relate to any particular sale, but still needs to be accounted for.
Add customer credit through Receive Money:
- Navigate to Financials → Receive Money.
- Select the bank account that will be receiving the deposit. You may also select the Customer you are receiving the money from, although this is not required.
- You might want to consider setting up a generic service item called Deposits to receive these payments.
- Under the Lines section, click +.
- Select the product, enter the quantity and price, select a tax rule, and change the account to Customer Credits. The Quantity and Price should equal the amount deposited by the customer.
- Click Complete.
View Customer Credit
View all the customer credits currently on record for your different customers.
View customer credit:
- Navigate to Sale → Customer Credits.
- The list of customer credits for each customer will be displayed. The transaction the credit is associated with can be accessed by clicking the link on the right.
Use Customer Credit
Accumulated Customer Credit can be used to offset payments owed. It can be applied to the sale during the Invoice stage.
Use available customer credit on an invoice:
- Create a sale order, then go through the stages, until you reach the Invoice stage. You can also choose an authorised invoice from Sale → Sales, then skip to Step 3.
- Authorise the invoice, then click Yes when prompted to apply existing customer credit, if any, to the sales order. Skip to Step 4.
- Still on the Invoice tab, scroll down to the Payment section at the bottom, then click +Use Customer Credit.
- On the Allocate Customer Credit as Payment page, check the appropriate customer credit from the list to be applied to the order. The allocated amount from the existing customer credit is then shown at the bottom.
- Click Add & Save. The customer credit is then added to the payments section and discounted from the total balance due. If the customer credit is more than enough to pay for the order, the total balance due will reflect zero, as seen in the screenshot below.