Payment can't be applied to a credit note


Manually entered (positive) payments are listed as “Unapplied” and can be applied to an invoice after they have been created. This is working like expected.

But when I create a negative payment, so I as a company pay my client, the payment is listed as completed and cannot be applied to a credit note anymore. To me this looks a bit broken.


When I open a credit note and try to enter a payment for the credit note, I says: The credit amount cannot exceed the payment amount

I doesn’t matter if I enter the exact same amount of the credit note in +227,56 or - 227,56 or any other amunt less than that. Also using a dot or a comma as a decimal separator didn’t make any difference.


I tried this both in my own installation as well as on

It looks like a bug.



v5 doesn’t support negative payments, to pay your client you can create a credit

Hi Hillel,

That is a bit suprising for me.

In v4 it was possible to create an invoice with negative unit costs and it would automatically become the next available number out of the credits number range.
Positive total sum -> invoices number range
Negative total sum -> credtis number range

In v4 you can mark the credit note as paid or create/add a negative payment linked to the credit note.
The Credits menu in v4 lets you create a credit like a deposit and you can apply it later to an invoice.

In v5 invoices and credit note are split up in two separate menus and both have a different number range and you can also set two different pdf designs (where in v4 invoice and credit notes would use the same design).

You are still able to create an invoice with a negative total sum but it will not get a number from the credits number range but just the next available invoice number. So in case I would need to create a credit note, I would always do it via the Credits menu in v5 and not as a negative invoice.

A “v4 credit”, like a deposit, is made by a payment. If I would like to create a deposit, I would just enter a manual payment. That payment can be applied to future invoices of that client.

Invoices in v5 can be mark as paid or I can create a payment which is linked to the invoice. But for credit notes, I can’t add a payment and there also isn’t an option to mark them as paid?!

The table below eventually makes it a bit clearer (assuming I understand it correctly)

Type v4 menu v4 functionality v5 menu v5 functionality
Credit note Invoices Any invoice with a negativ unit cost/price will automatically become a credit note. Credits Create a credit note similar to an invoice by creating an entry at “Credits > New credit”
Credit / Deposit Credits A credit can be entered with just the client and the amount. From the credit menu, you can apply the credit to an invoice. Payments Create a payment. It can be applied to an invoice later on.

Does this make sense?

Thanks a lot,

Yes, that’s correct.

The problem with v4 is that there was no connection between a credit note (negative invoice) and invoice, the credit note was just applied to the client’s balance. With v5 we now support applying a credit to a specific invoice which has been a common request.

Hi Hillel,

I am not sure if I understand you correctly.

What do you mean with “credit” in this sentence? Credit note or a (manual) payment?
If credit note, how do I aplly/connect a credit note to an existing invoice? I couldn’t find an option for it in the app.

And how to refund a payments? For example: an invoice has been paid for by PayPal or Stripe. Then it turns out that the job was done much quicker as planned and the client get some money back. So I would create a credit note but can I then sent a refund via PayPal or Stripe through InvoiceNinja and would the refund be stored as payment at the credit note?

So far from what I have seen in the demo account, all credit note are in the status “sent” and none of them has mark as paid/refunded.


You can apply a credit note to an invoice by creating a payment and selecting an invoice and credit note together. This will create the payment using the credit note.

You can refund a payment to return funds to your client.

Hi Hillel,

I have tried this out and I now understand how the feature is planned.

With a credit note it is possible to enter a payment which is not a real payment but a way to clear/compensate the value of the credit note on the open balance of an invoice.

Amount Balance
Invoice I-001 $ 499 - 499
Cleared by credit note C-001 $ 100 - 399
Payment $ 399 0

But that means that I can only clear/mark as paid a credit note as long as the client has an open balance on at least 1 invoice.

Example: I have to a job for a new client and we estimate that we need 5 hours. Because it is a new client, he will receive an invoice with 5 hours á 100 $ and he needs to pay upfront.
So Invoice is 500 $, payments was made and the balance is 0 $.
We than do the job much quicker and only needed 3 hours. So we will “reimburse” the client and create a credit note of 2 hours á 100 $. Of course I can refund the client by sending him a bank transfer of 200 $ but I will never be able to mark the credit note as paid or even enter this (negative) payment in InvoiceNinja.

The only option is when the client has a second job for us and we sent an invoice for 3 hours but because of the credit note of 200 $, he only needs to pay 100 $.

The example may be a little strange but we had these in the past. So if there is an option so just enter a negative payment with our the need of a connection to an invoice, that would be really great.

What I really like, is the way the client can apply his credits in the client portal. :slight_smile:


Thanks for your input, @david what do you think?

Hi Gijs,

We have reworked the philosophy of payments in V5 a little.

In V5 nothing effects the client balance until a payment\credit is applied to an invoice.

In the example above, depending on how you accept payments, your workflow could look like this:

  1. Accept payments via Invoice Ninja.

$500 Invoice Paid

$300 finally billed

Refund Payment $200.

Update Invoice to reflect the $300 paid balance.

  1. Accept payments by other means.

Create $500 Credit Note.

Create $300 Invoice. Send and mark as paid.

Update Credit note with negative line item of -$200 and process refund to client.

Does this match the flow you were expecting?

Hi @david,

Both examples could work but I see one major issue: At least in Germany but I guess also in most other European countries, it is not allowed to change anything to the documents once they have been sent to the customer.

In both of your examples, I would have to update either the credit note or the original invoice after they have initially been sent to the customer.

One option I see here, is to simply create an invoice with a negative amount. I haven’t tested it with online payments but since the biggest part of our payments are done via bank transfer, this wouldn’t be an issue. The only issue with this workaround, is that it still is an invoice with an invoice number and not like in v4 where the “negativ invoice” would automatically become a credit note number.

What would break if you would allow negative payments and if credit payments wouldn’t necessarily need a connection to both a credit note and invoice?