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How do I handle a negative invoice?


How do I handle a negative invoice?


Negative invoices are very common with subscription-based businesses. In the product economy, negative invoices are not possible since it is not possible to have a negative product.

A negative invoice might be created in one of the following two ways:

  • Performing an amendment that creates a negative proration, such as a cancellation, downgrade, or removal of a product.
  • Adding a product with a negative charge and generating an invoice.

If you do not want to have negative invoices in your account, you must perform all the cancellation, downgrade, and product removal operations at the end of a billing cycle. For more information, see How do I cancel or downgrade customers to avoid issuing a credit or refund?


You can use credit balances and invoice item adjustments to handle negative invoices.

Using Credit Balance to Handle Negative Invoices

If you want to treat a negative invoice as cash, you must create a credit balance and then either apply the credit balance as a payment against invoices or issue a credit balance refund. You cannot directly apply a negative invoice balance as a payment against invoices. 

For more information about transferring a negative invoice balance to a credit balance, see Creating Credit Balances

To handle negative invoices in the Zuora UI, see Credit Balances for the steps to create, apply, and refund credit balances.

To handle negative invoices in the SOAP API, see the Create a Credit Balance Adjustment use case.

Using Invoice Item Adjustments to Handle Negative Invoices

If you want to zero out, you can create an invoice item adjustment that creates a positive invoice transaction.

See Creating Invoice Item Adjustments for steps to create invoice item adjustments with the Charge type, which will change the invoice balance from negative to zero. Invoice Item Adjustments can be created with any Accounting Code you choose.

To handle this in the SOAP API, use the InvoiceItemAdjustment object.