Help Center / Accounts Receivable

Customer Credits

What is this page about: Light lets you create customer credits to reduce a customer's balance, and apply them against open or partially-paid invoices. This page explains the credit states, how to create and post a credit, how tax calculates on credit lines, how to apply a credit to one or more invoices, and how to edit custom properties after posting.

On this page

  • What is a customer credit in Light?
  • What are customer credit states in Light?
  • How do I create a customer credit?
  • How does tax calculation work on a customer credit?
  • How do I post a customer credit?
  • How do I apply a customer credit to an invoice?
  • Can I edit a customer credit after it's posted?
  • What other actions can I take on a customer credit?
  • Related Articles

What is a customer credit in Light?

A customer credit in Light is a credit document that reduces a customer's balance. You can apply the full credit amount, or allocate a partial amount, to one or more open or partially-paid sales invoices. Any unallocated balance remains available on the credit for future use.

To find customer credits in Light, navigate via Revenue & Invoicing → Customer credits.

What are customer credit states in Light?

A customer credit in Light can be in one of five states, shown as a badge on the credit: Draft, Posted, Partially cleared, Cleared, and Void.

A customer credit moves from Posted → Partially cleared → Cleared as it is applied to invoices.

Note: Archiving a credit voids it, the badge reads Void.

How do I create a customer credit?

To create a customer credit in Light:

  1. From Revenue & Invoicing, open the Create menu and select Customer credit.
  2. Light immediately creates the customer credit in Draft state and opens its detail page.
  3. Fill in the form (customer, entity, currency, lines, etc.) directly on the draft.

How does tax calculation work on a customer credit?

A customer credit calculates tax through whichever tax engine is configured for the entity. If the entity uses Avatax or Sphere, each line item displays the tax engine name as a badge in the Tax code column (e.g., "Avatax (your tax code)" or "Sphere"). If the entity uses Light's built-in tax codes, the Tax code column shows a dropdown selector instead.

How do I post a customer credit?

To post a customer credit, open the credit detail page and use the Post ▾ split-dropdown button at the top right:

  • Post & send credit note: posts the customer credit and emails it to the customer (the email composer opens, with the same fields used for invoices).
  • Post only: posts the customer credit without sending an email.

Once posted, a customer credit can be applied to invoices.

How do I apply a customer credit to an invoice?

A posted customer credit can be applied, in full or in part, to one sales invoice per action. Any unallocated balance stays on the customer credit for later use.

  1. Open the posted customer credit.
  2. Click Apply to invoice.
  3. The dialog lists invoices for the same customer, entity, and currency as the credit, filtered to Open or Partially paid state.
  4. Select one invoice.
  5. If partial allocation is enabled, enter the amount to apply (any amount up to the customer credit's available balance). If partial allocation is not enabled, the full available balance is applied.
  6. Review the running totals: total invoice amount, amount being applied, and remaining credit balance.
  7. Click Apply to invoice to submit, then click Confirm on the confirmation step.
  8. To apply the same customer credit to another invoice, repeat this process. Only one invoice is applied per action.

What happens after a customer credit is applied:

  • The selected invoice's balance decreases by the applied amount.
  • The customer credit's state updates to Partially cleared if a balance remains on the credit, or Cleared if the credit is fully allocated.
  • A partially cleared customer credit can be applied to additional invoices at any time.

Can I edit a customer credit after it's posted?

Yes. After a customer credit is posted, its amounts and quantities are locked, while custom properties, line descriptions, GL accounts, tax codes, document date, and PO number stay editable. You can update these fields without voiding and recreating the customer credit.

To edit a posted customer credit's custom properties:

  1. Open the posted customer credit.
  2. Enter edit mode on the line item you want to update.
  3. Add, change, or remove the line item's custom properties (department, cost center, project code, etc.).
  4. Confirm the changes when prompted, then save.

Every change to a posted customer credit is recorded in the credit's modification history, and the line item re-locks after saving. See Custom Properties for more.

What other actions can I take on a customer credit?

Actions available in the customer credit detail header's three-dot menu (⋮) depend on the credit's status, and on your permissions:

  • Duplicate: creates a new customer credit pre-filled from this one. Available on any credit you have permission to edit, including Draft, Posted, and Void.
  • Reset to draft: returns the credit to Draft state. Available only on Posted credits.
  • Send e-invoice: submits the credit to the e-invoicing network Light supports, when e-invoicing is enabled for your entity. Available on Posted, Partially cleared, and Cleared credits.
  • Archive: archives the credit; the badge changes to Void. Available on Draft and Posted credits.
  • Restore: brings the credit back from Void. Available only on Void (archived) credits.

Your role's permissions can further restrict which of these you see.

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