How to create an overpayment for DPP and Claim/Sale in Xero

There are two types of overpayments we receive for Sales. An overpayment for a Deposit Pending Preliminaries (DPP) and another for a Progress claim.

Overpayments can be intentional – if, for example, you want to record a deposit (DPP) or advance payment on a progress claim for a client’s build.

When an overpayment is made by a customer or client and received in the bank, we will have to create a transaction in Xero to be able to reconcile this.

1. Go into the Bank reconciliation function of Xero. On the left will be a column with all the bank transactions, spent and received.
2. Find the payment that has been sent through from the client.
3. On the right is a column of matching transactions in Xero. However, because the payment has no invoice/claim to be applied to, there won’t be a matching transaction here.

Instead there will be a box with multiple tabs.

4. Click the Find & match link on the right.
5. Select the New transaction button to the right and then select  Receive money.

6. Then click the drop down option next to Received as and select Overpayment.

7. Be sure to check that the From field has the correct customer contact name in it.
8. In the description field, add the word Preliminary works fee with the job number for extra clarity.
9. Add the Job number into the Job number tracking field.
10. Click Save Transaction.

10. Then click Ok to reconcile the transaction.

If an overpayment is made on an existing claim invoice, (for example the customer has overpaid an invoice total by $500.00, we can create an overpayment that can sit in the system and be applied to a later invoice.

Click on the link for instructions on how to do this. https://help.gjgardner.com/au/hc/xero/how-to-receive-an-overpaid-claim-from-a-customer/