You can create a credit balance by using overpayments or by transferring a negative invoice balance.
Using Overpayments to Create a Credit Balance
You can use external or electronic payments to create a payment that is greater than the invoice amount due. The payment amount that exceeds the invoice amount is applied to the credit balance.
To create a credit balance using an overpayment:
- View an invoice with a positive balance.
- In the invoice detail screen, select more > Process a Payment.
- The Payment Total field displays the amount due. Increase this amount by the amount that you want to apply to the credit balance.
- The Applied to Invoices field displays the amount that will be applied to the current invoice. The Remaining Amount field displays the amount that will be applied to a credit balance. To create a credit balance, increase the Remaining Amount so that a value is shown in the Applied to Invoices field.
- Click create payment.
- Zuora Payments displays a confirmation dialog when you are applying an overpayment to the credit balance. Click Yes to confirm that you want to create a credit balance from the overpayment.
The payment amount that was transferred to the credit balance cannot be refunded as it is now part of the credit balance. You must perform an external refund of the credit balance separately.
Creating a Credit Balance by Transferring a Negative Invoice Balance
A negative invoice amount represents money that you owe the customer. You can transfer a negative invoice amount to a credit balance. Typically, in order to close out a negative invoice, you would transfer the full negative invoice amount to the credit balance. Subsequently, you could apply the credit balance toward a future invoice.
The following default values are used when transferring a negative invoice balance:
- The full invoice balance is used as the default value.
- The amount available for transfer is the invoice balance.
- The transfer uses the current date.
To create a credit balance using a negative invoice balance:
- View an invoice with a negative balance.
- In the Invoice Details screen, click more and select Transfer to Credit Balance.
- A confirmation dialog appears. Click Yes to confirm the transfer.
Example: Creating a Partial Service Credit
This example describes how to create a partial service credit for your customers. For example, if your website is down for some reason, you can give your customers a credit for each day of the downtime.
To process partial service credit for subscriptions:
- Create a rate plan charge for a "Service Credit." This can be in its own product or in an existing product.
- Create a negative one-time charge for the "Credit." For this case, you might want to create a per unit charge that is -$X per day or a flat fee. Note that the actual amounts can be changed in the next step.
- Add the Service Credit rate plan to the subscription on the accounts you want to credit. At this time, you can change the amount or quantity.
- Either wait for the next billing cycle to pick up the credit or generate an invoice immediately. If you want to have the credit apply to the next bill, the best practice is to have it generate on the next normally scheduled invoice. This is the more streamlined approach.
- If the credit needs to be generated immediately, execute a bill run for the accounts for one-time charges only.
- Transfer the negative charge to the credit balance on the account.
- Refund the credit balance, if desired, or apply the credit balance to current or future open invoices.