How to net off a bill and bill credit note

This article explains how to match a bill to a bill credit note in FreeAgent.

The steps you need to take depend on whether you’re not going to pay the bill or going to pay part of it.

If you’ve received a refund for a bill that you’ve already paid, find out how to enter a refund from a supplier.

If you’re not going to pay the bill 

It’s important to keep an accurate record of all the activity in your accounts, so if you’ve added a bill in FreeAgent and you’re not going to pay it, we recommend that you don’t delete the bill.

Instead, please follow these steps:

1. Create a bill credit note for the full amount of the bill.  
2. From the bill credit note you’ve created, select ‘Add a manual payment’ and set the date of the manual payment to the date of the bill credit note. All the other information will be populated automatically. 
3. From the ‘Bills’ area of FreeAgent, navigate to the bill in question by selecting the relevant reference number. 

4. From your view of the bill, select 'Add a manual payment'.

5. Set the date of the manual payment to the date of the bill credit note. All the other information will be populated automatically.

Once you’ve followed these steps, the bill will show as ‘Paid’ and the bill credit note will show as ‘Refunded’ in the ‘Bills’ area of FreeAgent.

If you navigate to the bank account from which you made the bill payment, you’ll see a receipt and a payment for the same amount.

If you’re only going to pay part of the bill 

If you’ve created a bill in FreeAgent and you’re only going to pay part of it, please follow these steps:

1. Begin by creating a bill credit note for the amount that you don’t intend to pay. From the bill credit note you’ve created, select ‘Add a manual payment’ and set the date to the date of the bill credit note. All the other information will be populated automatically.
2. Next, navigate to the bill in question from the ‘Bills’ area of FreeAgent by selecting the relevant reference number. 
3. From your view of the bill, select ‘Add a manual payment’ and enter the amount that you’re not going to pay. Set the date of the manual payment to the date of the bill credit note. Once you’ve followed these steps, the remaining amount of the bill will continue to show as  ‘Open’ in the ‘Bills’ area of FreeAgent. However, the bill credit note will show as ‘Refunded’ and will display the amount that you are not going to pay.

4. Finally, to settle the bill in your FreeAgent account, navigate to the bank account from which you made the bill payment. Select the ‘money out’ transaction for the amount that you’ve paid and explain it as a bill payment.