How to remove a prepayment on a supplier account

[suejin]

I inadvertently overpaid a supplier and their account now shows a prepayment balance. They refunded the amount overpaid and I’ve posted it to my current account, but I can’t find a way to allocated this transaction to the prepayment on the supplier’s account. Can you help?

[Parker1090]

In my example, I bought a pencil pot for £5.99 in Tesco, but somehow paid them £9.99, leaving £4.00 unallocated and sat on their account.

If you go to the suppliers account, click ‘View’ and select ‘Payments’:

You’ll see all payments made and how they’ve been allocated. In my example, £4.00 remains unallocated and sits on the suppliers account:

View that payment, and select ‘Refund Balance’:

Enter the details, the bank account it was refunded to etc, and that should be job done.

Here’s the original, and the refund transaction:

Edit
If you’ve already created the bank transaction, you can safely delete it to avoid the duplication of the refund.