Refund from a supplier

A supplier may refund you for an invoice already paid, or a payment may have been rejected by the bank.

There are various scenarios that may arise, but this Sage Intacct Help Sheet is designed to cover the most common, if you have a specific query not covered, please contact the support team.

Our consultancy team can design a more automated process for you, for more information please contact your Customer Success Manager. Details of how to process these can be found section 2.

1. Posting a credit note and refund for whole/partial amount that will not be applied to a future invoice(s)

An invoice has been posted and paid in full.

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If you have received a credit note the balance of the account will be reduced, the credit note will be posted to the GL account of the invoice.

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To record the refund and to clear the supplier balance, navigate to Accounts Payable, All, Adjustments and post a non-vatable credit memo.

If you have assigned Document Sequencing for adjustments the Adjustment number will say –New--, otherwise enter a reference that you can use to track the transaction.

Select suspense, or a dedicated supplier refunds code if you have one. There is no VAT implication so use the code No VAT Input Tax Detail code.

You can reference the credit note when posting the adjustment.

The adjustment will increase the balance on the supplier.

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The adjustment will credit the control account and debit suspense (supplier refunds code).

Allocate the credit note to the adjustment via Pay AP invoices, ensuring the Amount to pay is 0.00. If the Credits available value is larger than the adjustment, click on Line details to allocate the specific credit.

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To record the refund in the bank, post a journal to debit the bank and credit suspense, or the GL account used on the adjustment.

2. Processing a refund using the automated process

This section assumes that the Supplier Refunds Enhancements package has already been installed and the REFD journal type already exists.

The supplier refund functionality is used where a supplier grants a refund for a late credit or overpayment.

It may also be used where a payment has been rejected by the bank after it has been processed and you do not wish to void the whole payment batch to reverse it.

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Navigate to Accounts Payable, All, Adjustments and post an adjustment with type credit memo. The adjustment will increase the balance on the supplier.

Enter required description and select the Supplier Refund checkbox, the account that the money has been refunded into in the Refund into Account dropdown and any refund reference.

Select suspense, or a dedicated supplier refunds code if you have one. There is no VAT implication so use the code No VAT Input Tax Detail code.

Click Post. There are several validation steps that the software will undertake. If you are presented with an error, review the message, and correct your input.

Review the GL postings – the double entry will Credit the Creditors Control Account and Debit the Suspense, or dedicated supplier refund Account.

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The Supplier refunds package ensures that the relevant journal (REFD) is posted between the bank and the chosen GL account to reverse the initial debit to that account.

To view the journal, navigate to General Ledger, All, Journal Entries and click View Transactions next to the Refund Journal.

Two transactions will have been created, one for the zero value VAT amount and one for the net amount of the refund.

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The net value journal, above, reverses the original debit from the Suspense account and posts a debit to the bank account to show the money being received.

Sage Intacct

Refund from a supplier

1. Posting a credit note and refund for whole/partial amount that will not be applied to a future invoice(s)

2. Processing a refund using the automated process

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