Payment Entry
Overview
Payment Entry – Business Overview
Payment Entry is a core financial document used to record and manage all money movements in and out of the business. It serves as the official record for receiving payments from customers, making payments to suppliers or employees, transferring funds between company accounts, and adjusting outstanding balances.
In simple terms, Payment Entry shows who paid whom, how much was paid, when it was paid, and why it was paid.
Purpose in Business Operations
Payment Entry is used to: - Record incoming payments from customers - Record outgoing payments to suppliers, employees, or service providers - Track advance payments and adjust them against future invoices - Manage bank, cash, and digital payment movements - Keep customer and supplier balances accurate - Support financial reporting, cash flow tracking, and audits
Without Payment Entry, businesses cannot properly track cash flow or know which invoices have been paid or remain outstanding.
Prerequisites and Setup Requirements
Before using Payment Entry, the following business setup should be in place: - Customers, suppliers, and employees must be defined - Company bank accounts, cash accounts, and payment methods should be available - Sales invoices, purchase invoices, or expense records should be created (if payments are linked to invoices) - Clear internal policies for payment approvals and authorization
Having this setup ensures payments are recorded correctly and linked to the right parties.
Typical Business Workflow
Payment Trigger
- A customer pays an invoice
- A supplier submits a bill
- An employee needs reimbursement
- Funds are moved between company accounts
Create Payment Entry
- Select whether it is a receipt, payment, or internal transfer
- Choose the party involved (customer, supplier, employee, or company account)
- Enter payment amount, date, and payment method
Link to Outstanding Invoices (if applicable)
- Match the payment against one or more invoices
- Handle partial payments or advance payments if needed
Review and Approval
- Payment details are checked for accuracy
- Approval is completed as per company policy
Confirmation
- Payment Entry is finalized
- Account balances and outstanding amounts are updated automatically
This workflow ensures every payment is traceable and financially accurate.
Key Business Scenarios Where Payment Entry Is Essential
Customer Collections
Recording payments received against sales invoices and reducing outstanding receivables.Supplier Payments
Paying vendors for goods or services while maintaining accurate payable balances.Advance Payments
Accepting advance payments from customers or paying suppliers before invoices are issued.Employee Reimbursements
Paying staff for expenses or allowances.Bank and Cash Management
Tracking money movement across bank accounts, cash registers, and digital wallets.Internal Fund Transfers
Moving money between company accounts without affecting income or expenses.
Important Considerations for Users
- Always verify the payment amount and party before confirming the entry
- Ensure payments are linked to the correct invoices to avoid balance mismatches
- Use clear references (such as invoice numbers or payment notes) for future audits
- Follow internal approval rules for large or sensitive payments
- Regularly review Payment Entries to monitor cash flow and detect errors early
Summary
Payment Entry is the backbone of daily financial operations. It provides transparency, accuracy, and control over all money movements in the business. When used correctly, it ensures reliable financial records, smooth cash flow management, and strong financial governance across the organization.
Basic Information
- Module: Accounts
- Document Type: Other
Fields
| Field Name | Label | Type | Required | Options | Description |
|---|---|---|---|---|---|
| naming_series | Series | Select | ✓ | ACC-PAY-.YYYY.- | Defines Dafater document numbering pattern for payment records |
| payment_type | Payment Type | Select | ✓ | Receive, Pay, Internal Transfer | Specifies whether payment is received, paid, or internally transferred |
| paymentorderstatus | Payment Order Status | Select | Initiated, Payment Ordered | Tracks progress of linked payment order processing | |
| posting_date | Posting Date | Date | ✓ | - | Accounting date when payment impacts Dafater ledgers |
| company | Company | Link | ✓ | Company | Company under which this payment is recorded |
| modeofpayment | Mode of Payment | Link | Mode of Payment | Method used to execute the payment | |
| party_type | Party Type | Link | ✓ | DocType | Defines whether party is customer, supplier, or other |
| party | Party | Dynamic Link | ✓ | party_type | Specific party involved in the payment |
| party_name | Party Name | Data | - | Display name of the selected party | |
| bookadvancepaymentsinseparatepartyaccount | Book Advance Payments in Separate Party Account | Check | - | Records advance payments in a separate party account | |
| reconcileonadvancepaymentdate | Reconcile on Advance Payment Date | Check | - | Reconciles advances based on original advance payment date | |
| bank_account | Company Bank Account | Link | Bank Account | Company bank account used for this payment | |
| partybankaccount | Party Bank Account | Link | Bank Account | Bank account details of the receiving or paying party | |
| contact_person | Contact | Link | Contact | Primary contact person for this payment transaction | |
| contact_email | Data | Email address of the selected contact person | |||
| party_balance | Party Balance | Currency | - | Current outstanding balance of the selected party | |
| paid_from | Account Paid From | Link | ✓ | Account | Account from which funds are paid |
| paidfromaccount_type | Paid From Account Type | Data | - | Type of Dafater account funds are paid from | |
| paidfromaccount_currency | Account Currency (From) | Link | ✓ | Currency | Currency of the source payment account |
| paidfromaccount_balance | Account Balance (From) | Currency | paidfromaccount_currency | Available balance in the source account | |
| paid_to | Account Paid To | Link | ✓ | Account | Account to which funds are received |
| paidtoaccount_type | Paid To Account Type | Data | - | Type of Dafater account funds are received into | |
| paidtoaccount_currency | Account Currency (To) | Link | ✓ | Currency | Currency of the target receiving account |
| paidtoaccount_balance | Account Balance (To) | Currency | paidtoaccount_currency | Available balance in the target account | |
| reference_no | Cheque/Reference No | Data | - | Cheque number or external payment reference identifier | |
| reference_date | Cheque/Reference Date | Date | - | Date mentioned on cheque or payment reference | |
| clearance_date | Clearance Date | Date | - | Date when bank clears the payment | |
| paid_amount | Paid Amount | Currency | ✓ | paidfromaccount_currency | Amount paid from the source account |
| paidamountafter_tax | Paid Amount After Tax | Currency | paidfromaccount_currency | Net amount paid after applicable taxes | |
| sourceexchangerate | Source Exchange Rate | Float | ✓ | - | Exchange rate from source account currency |
| basepaidamount | Paid Amount (Company Currency) | Currency | ✓ | Company:company:default_currency | Paid amount converted to company base currency |
| basepaidamountaftertax | Paid Amount After Tax (Company Currency) | Currency | Company:company:default_currency | Net paid amount in company base currency | |
| received_amount | Received Amount | Currency | ✓ | paidtoaccount_currency | Amount received into the target account |
| receivedamountafter_tax | Received Amount After Tax | Currency | paidtoaccount_currency | Net amount received after taxes | |
| targetexchangerate | Target Exchange Rate | Float | ✓ | - | Exchange rate applied to target account currency |
| basereceivedamount | Received Amount (Company Currency) | Currency | ✓ | Company:company:default_currency | Received amount in company base currency |
| basereceivedamountaftertax | Received Amount After Tax (Company Currency) | Currency | Company:company:default_currency | Net received amount in company base currency | |
| getoutstandinginvoices | Get Outstanding Invoices | Button | - | Fetches unpaid invoices for allocation | |
| getoutstandingorders | Get Outstanding Orders | Button | - | Fetches unpaid orders for advance adjustment | |
| references | Payment References | Table | Payment Entry Reference | Links payment amounts against invoices or orders | |
| totalallocatedamount | Total Allocated Amount | Currency | - | Total amount allocated to references | |
| basetotalallocated_amount | Total Allocated Amount (Company Currency) | Currency | Company:company:default_currency | Allocated amount in company base currency | |
| unallocated_amount | Unallocated Amount | Currency | - | Remaining amount not allocated to any reference | |
| difference_amount | Difference Amount (Company Currency) | Currency | Company:company:default_currency | Difference between paid and allocated amounts | |
| writeoffdifference_amount | Write Off Difference Amount | Button | - | Writes off minor payment differences automatically | |
| taxwithholdingcategory | Tax Withholding Category | Link | Tax Withholding Category | Defines applicable withholding tax rules | |
| basetotaltaxesandcharges | Total Taxes and Charges (Company Currency) | Currency | Company:company:default_currency | Total taxes calculated in company base currency | |
| totaltaxesand_charges | Total Taxes and Charges | Currency | - | Total taxes and charges applied to payment | |
| applytaxwithholding_amount | Apply Tax Withholding Amount | Check | - | Applies withholding tax on this payment | |
| purchasetaxesandchargestemplate | Purchase Taxes and Charges Template | Link | Purchase Taxes and Charges Template | Default purchase tax template for payment | |
| salestaxesandchargestemplate | Sales Taxes and Charges Template | Link | Sales Taxes and Charges Template | Default sales tax template for payment | |
| taxes | Advance Taxes and Charges | Table | Advance Taxes and Charges | Detailed breakdown of advance taxes and charges | |
| deductions | Payment Deductions or Loss | Table | Payment Entry Deduction | Records deductions or losses during payment | |
| project | Project | Link | Project | Associates payment with a specific project | |
| cost_center | Cost Center | Link | Cost Center | Cost center to allocate payment expenses or income | |
| status | Status | Select | , Draft, Submitted, Cancelled | Current workflow status of the payment entry | |
| custom_remarks | Custom Remarks | Check | - | Enables use of customized remarks format | |
| remarks | Remarks | Small Text | - | Additional notes or explanations for the payment | |
| baseinwords | In Words (Company Currency) | Small Text | - | Payment amount written in words, company currency | |
| is_opening | Is Opening | Select | No, Yes | Marks payment as an opening accounting entry | |
| letter_head | Letter Head | Link | Letter Head | Letterhead used when printing the payment document | |
| print_heading | Print Heading | Link | Print Heading | Heading displayed on printed payment documents | |
| bank | Bank | Read Only | - | Bank name derived from selected bank account | |
| bankaccountno | Bank Account No | Read Only | - | Bank account number derived from bank account | |
| payment_order | Payment Order | Link | Payment Order | Linked payment order initiating this transaction | |
| in_words | In Words | Small Text | - | Payment amount written in words | |
| auto_repeat | Auto Repeat | Link | Auto Repeat | Automates recurring creation of this payment entry | |
| amended_from | Amended From | Link | Payment Entry | Original payment entry being amended | |
| title | Title | Data | - | Short title identifying this payment entry |
Child Tables
Payment References (Payment Entry Reference)
| Field Name | Label | Type | Required | Options | Description |
|---|---|---|---|---|---|
| reference_doctype | Type | Link | ✓ | DocType | Source document type linked to this payment reference. |
| reference_name | Name | Dynamic Link | ✓ | reference_doctype | Specific source document identifier for this payment allocation. |
| due_date | Due Date | Date | - | Date when the referenced invoice or document becomes due. | |
| bill_no | Supplier Invoice No | Data | - | Supplier invoice number for matching and audit purposes. | |
| payment_term | Payment Term | Link | Payment Term | Agreed payment term defining schedule and conditions. | |
| paymenttermoutstanding | Payment Term Outstanding | Float | - | Outstanding amount for this specific payment term. | |
| account_type | Account Type | Data | - | Type of account affected by this payment reference. | |
| payment_type | Payment Type | Data | - | Indicates whether payment is advance, against invoice, or adjustment. | |
| reconcileeffecton | Reconcile Effect On | Date | - | Posting date used to calculate reconciliation and ledger impact. | |
| total_amount | Grand Total | Float | - | Total document amount before allocations and adjustments. | |
| outstanding_amount | Outstanding | Float | - | Remaining unpaid amount for the referenced document. | |
| allocated_amount | Allocated | Float | - | Amount allocated from this payment to the reference. | |
| exchange_rate | Exchange Rate | Float | - | Exchange rate applied for foreign currency transactions. | |
| exchangegainloss | Exchange Gain/Loss | Currency | Company:company:default_currency | Calculated gain or loss due to currency exchange differences. | |
| account | Account | Link | Account | General ledger account used for this payment allocation. | |
| payment_request | Payment Request | Link | Payment Request | Linked payment request initiating or tracking this payment. | |
| paymentrequestoutstanding | Payment Request Outstanding | Float | - | Outstanding amount remaining on the linked payment request. | |
| advancevouchertype | Advance Voucher Type | Link | DocType | Type of advance voucher adjusted against this payment. | |
| advancevoucherno | Advance Voucher No | Dynamic Link | advancevouchertype | Specific advance voucher reference adjusted in this payment. |
Advance Taxes and Charges (Advance Taxes and Charges)
| Field Name | Label | Type | Required | Options | Description |
|---|---|---|---|---|---|
| adddeducttax | Add Or Deduct | Select | ✓ | Add, Deduct | Specify whether this tax or charge is added or deducted |
| charge_type | Type | Select | ✓ | , Actual, On Paid Amount, On Previous Row Amoun... | Define how the charge is calculated in Dafater transactions |
| row_id | Reference Row # | Data | - | Reference row number used for dependent charge calculations | |
| account_head | Account Head | Link | ✓ | Account | Ledger account used for posting this tax or charge |
| description | Description | Small Text | ✓ | - | Business description or notes for this tax or charge |
| includedinpaid_amount | Considered In Paid Amount | Check | - | Indicates if amount is included in paid amount calculation | |
| cost_center | Cost Center | Link | Cost Center | Cost center to allocate this tax or charge amount | |
| rate | Tax Rate | Float | - | Percentage rate applied for calculating the tax amount | |
| currency | Account Currency | Link | Currency | Currency of the linked account in Dafater | |
| tax_amount | Amount | Currency | currency | Calculated tax or charge amount in selected currency | |
| total | Total | Currency | currency | Total amount after applying this tax or charge | |
| allocated_amount | Allocated Amount | Currency | currency | Portion of this amount allocated to payments | |
| basetaxamount | Amount (Company Currency) | Currency | Company:company:default_currency | Tax or charge amount in company base currency | |
| base_total | Total (Company Currency) | Currency | Company:company:default_currency | Total amount in company base currency |
Payment Deductions or Loss (Payment Entry Deduction)
| Field Name | Label | Type | Required | Options | Description |
|---|---|---|---|---|---|
| account | Account | Link | ✓ | Account | Dafater account used to record the payment deduction. |
| cost_center | Cost Center | Link | ✓ | Cost Center | Cost center in Dafater for allocating the deducted amount. |
| amount | Amount (Company Currency) | Currency | ✓ | Company:company:default_currency | Deduction amount recorded in company base currency. |
| isexchangegain_loss | Is Exchange Gain / Loss? | Check | - | Indicates whether deduction represents exchange gain or loss. | |
| description | Description | Small Text | - | Additional notes or business context for this deduction. |
Permissions
| Role | Read | Write | Create | Delete | Submit | Cancel |
|---|---|---|---|---|---|---|
| Accounts Manager | ✓ | ✓ | ✓ | ✓ | ✓ | ✓ |
| Accounts User | ✓ | ✓ | ✓ | ✓ | ✓ | ✓ |
Related DocTypes
| DocType | Relationship | Module |
|---|---|---|
| Account | Links to | Accounts |
| Auto Repeat | Links to | Automation |
| Bank Account | Links to | Accounts |
| Company | Links to | Setup |
| Contact | Links to | Contacts |
| Cost Center | Links to | Accounts |
| Currency | Links to | Geo |
| Letter Head | Links to | Printing |
| Mode of Payment | Links to | Accounts |
| Payment Entry | Links to | Accounts |
| Payment Order | Links to | Accounts |
| Print Heading | Links to | Setup |
| Project | Links to | Projects |
| Purchase Taxes and Charges Template | Links to | Accounts |
| Sales Taxes and Charges Template | Links to | Accounts |
| Tax Withholding Category | Links to | Accounts |