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Handle prepayments

Managing prepayments efficiently is vital for accurate financial tracking and reducing complexities in billing operations. When you sync your bill with NetSuite and there’s a prepayment on it, this displays in the invoice review screen. The prepayment bill is linked to the PO that the payment was made for and offsets the remaining net amount due. There’s no need to carry out PO matchingThe process of matching goods and services from purchase orders to invoices (2-way matching), and receipts (3-way matching) for prepayment bills, simplifying the handling of prepayments and enhancing accuracy and efficiency in financial workflows.

  • You can only use prepayment lines if you sync Tipalti with a NetSuite account

  • You don’t need to have the NetSuite prepayment feature or make any adjustments to your NetSuite account

  • For prepayment invoices, the linked PO must have at least one line item

  • Negative PO lines aren’t supported

When can you use prepayment billing?

You can use prepayment billing for:

  • Single invoice handling, with or without a dedicated prepayment bill line

  • POs that don’t state prepayments on a specific line

  • Prepaid amounts that match a negative bill line

  • Part prepaid invoices

  • Multiple prepayments applied to a single PO

  • Multiple POs with linked prepayments to a single bill

You can mark a bill as a prepayment when it’s in Pending review.

To mark a bill as a prepayment:

  1. Open a bill that’s pending review in Bills and start reviewing the invoice as usual.

  2. In Bill header, select Prepayment from Bill type. This changes the bill to a prepayment.

  3. In PO number, select the PO that the prepayment was made for.

    This prepayment is linked to the PO but skips PO matching as there’s no need for it with prepayments.

  4. Click Submit. The bill goes through for approval.

    • Once approved, the bill moves to Pending payment and must be paid so you can use the prepayment in other bills related to the same PO.

    • You can apply the prepayment to any bills linked to the PO.

    • Any bills in Pending review or PO matching that are linked to the same PO display the prepayment.

    • You can apply the whole or part of the prepayment amount to the bill as long as it’s equal or less than the total amount due.

    • The prepayment offsets the net amount.

After you make a prepayment bill, any bills linked to the same PO show there’s a prepayment ready to use.

If you apply the whole or part of the prepayment to the bill you’re working on, it offsets the net amount. You can only apply a prepayment equal to or less than the net amount owed.

To apply the prepayment to offset a net amount:

  1. Open a bill that’s linked to the same invoice as the prepayment, either in Pending review or PO matching.

    2. The prepayment displays above the Bill lines and shows the total prepaid amount and the amount that’s still available to use.

  2. In Prepayment, click the edit icon to the right of the listing.

  3. Enter the amount you want to apply to the bill. This offsets the bill’s net amount.

    4. You can enter a percentage in the percentage field, or the currency amount in the amount field.

  4. Click the save icon.

    • The net amount deducts the applied prepayment and updates to account for the offset.

    • The net amount should be zero or positive to show no overpayment was made.

    • A prepayment negative bill line is created that’s marked as a prepayment. It indicates the deducted prepayment amount.

    • If you have any other negative lines, you can set them as prepayments or non-PO lines.

      • In addition to prepayments, negative bill lines can indicate discounts or vendor credits, which can both be non-PO lines.

  5. In the PO or PO receipt column, in Match PO line, click prepayment to mark it as a prepayment if it hasn’t been marked already.

  6. To track how the prepayment was applied previously, click View history under the PO number in the prepayment line.